Pricing is … Instantaneous

OK, maybe instant is an exaggeration, but pricing has a much faster impact than any other marketing mix variable. 

As the CEO of a company, you can decide to change a product.  If it’s a physical product it can take months if not a year or more to develop and test the new product.  Software takes a while as well.

You can decide to change the place (i.e. your distribution channel).  This requires contract negotiations, web site development, relationship building and more.

You can decide to change the promotion.  Even after developing a new promotion campaign, it takes a while to touch your customers and potential customers enough times to change their perceptions hopefully leading to changing behavior.

You can decide to change the price and BOOM, there it is.  However quickly you can communicate a price change, your customers will absorb that information and change their behaviors almost instantly.  This is why we see price wars and not product wars, place wars or promotion wars.

The fastest way to influence customer purchase behavior is by changing prices.  Not always the best method, but certainly the fastest.

Mark Stiving, Ph.D. (in Pricing)

Photo by Julian Lim