price

If price isn't the determining factor in the purchase of something, but just a contributing factor, can we say that there is one, single, determining factor? I believe that the answer to this is a resounding "yes."

I think that one, determining factor is the value that a consumer places on a product or service. Value is the culmination of product, price, place and promotion. Value is the worth the customer places on a product as compared to the cost. When I say cost here, I don't necessarily mean monetary cost. I mean cost in terms of time, effort, money and energy. I mean cost in terms of what it actually takes for you to buy something.

How do you increase the value of the product you sell? How do you establish a greater worth to your "commodity?"

Is it by adding more, differentiated products?

I don't think so, I think that it is about providing the best customer experience.

So, how do you conduct business so that people are willing to pay more for the experience you provide? continue reading...

People only buy on price if all things are (or perceived to be) equal. Even the cheapest person can realize (usually) that sometimes paying just a little more now may save a lot in the long run.

Budgets are important, but long term strategy is also.

When a company goes for an RFP and evaluates the bid, the only reason they would choose based on price is because they perceive that everything else is equal. That is only the case if those products and the companies that sell those products are exactly identical.

Price tends to be the tie breaker if all things are equal. continue reading...

I am of the opinion that nobody buys on price. Nobody. Period. So, you may ask, "What about the people who buy from Costco?" Well, not everything there is the lowest price. Some buy because of the return. Everyone buys because of the perceived value that the cost provides.

Okay, you may ask, "What about all the people buying a Hubble Home?" or "What about those that are willing to buy a Scion?" continue reading...