In various blog posts, I have asked the readers to base their pricing decisions on elasticity. In this post, lets try to understand the term better.
Lets start with a mental exercise. Imagine you increase the price of your product by 1%. What happens next?
Continue reading Price elasticity: A short primer
Last month the press reported that Gujarat Cooperative Milk Marketing Federation, the owners of Amul brand were sued by Unilever for claiming that unlike others they used real milk in their ice-creams.
The merits of the case aside, it points to the well know marketing rule that you need to communicate about benefits of your product. A good product sells by itself, is at best an exception and at worst a myth. Continue reading Communicate value to command price premium
“ It is monsoon sir”, he said with a measured calmness.
I was at park street in Kolkata. It was Sunday afternoon and the place was abuzz with shoppers and hawkers. The road-side vendor did not doubt my knowledge of the season. He was reacting to my disbelief, when he quoted Rs. 300 for a small umbrella. This man clearly understood value based pricing. Continue reading What is the right price for your product? Start from value based price
A few weeks back, the morning business paper solemnly informed me that Amul milk would be dearer by Rs. 2 per litre. The article further noted that this was 2nd such price hike in the last 8 months. That got me thinking as to why many organisations that I have worked with did not take price as seriously as marketing, sales or cost savings. Continue reading Price : The most unexploited profit lever