BU479 Chapter Notes - Chapter 7: Brand Equity, The Monthly, Salesforce.Com
Document Summary
Furthermore, customer perceptions of the costs versus benefits of the new technology affect pricing strategy: customer anxiety may cause delays in adoption. And the availability of low-priced or free offers on the internet makes customers more sensitive to prices. Issues of backward compatibility support for existing products, changing industry standards, pricing for product derivatives, and so forth, all must be considered in pricing strategy. The 3 c"s of pricing: the 3 c"s of pricing-costs, competition, and customers-are analogous to a three-legged stool, Stools with only two legs are unbalanced and likely to topple over. Similarly, setting price on the basis of only one or two of the 3 c"s results in an unstable situation. Solid pricing strategy must systematically consider all three factors. A customer can always choose not to adopt new technology, instead solving problems based on former solutions. In such a situation, a larger number of sellers can result in increased rather than decreased prices.
