Consumer interpretations of price is an important factor in the case of making purchasing decisions. However, Consumers are always run after the low prices products. That’s why there exists a huge competition in the marketplace. Every industry tries to offer better than others. So, having competition, low price can get an advantage from the marketplace.
Price is also set for packaging, quality, a feature of the products. But in this case, you have to ensure a lower cost. Otherwise, you can’t enjoy economies of scale. There are some implications of consumers regarding pricing. Let’s see-
- Time implications
Time implication is the general rule for both individual and industrial consumers. Because getting late any product can your lots of time. So, it is associated with a time cost. As a result, consumers are a switch to other products which are available in the marketplace. However, if you want to keep your target customers, you should try to deliver their desire products whenever they demand it.
- Psychological implications
As previously we discussed, the price is mostly a psychological matter. Consumers tend to rely on price differentiating the products quality and performance. So the result is a successful product have a higher price than the fewer quality products.
However, customers tend to pay more for higher quality. Some are paid more for avoiding less perceived quality products. Because they believe that lower price branded provides unsatisfactory experienced. The assumption is that lower branded has lower quality as well as lower product performance, features, customer service benefits to attached with certain risks.
Moreover, not all the higher charging price brand is good. Their pricing may not be the acceptable range. In this case, those brands offer discounts, membership card, prize coupons, etc. The acceptable prices are only available for shopping goods. Because the pice of luxurious goods or specialty goods are not in the acceptable range.
- Price lines
A variation of acceptable price levels is called price lining. In price lining, price levels are set up for product type and individual brand priced. By offerings, more products in a one price line can attract a huge market segment at once. Maintaining consistency is one kind of risk in price lining. Because it can damage the product image.
- Reference prices
The reference price is a psychological dimension of the price. The buyer expected price based on their past experience. However, the seller uses a reference price to invite comparisons with the current discounted price. This helps a buyer to save some money from purchasing a product. There are some psychological implications in terms of product value. However, the consumer response will depend on the size of the discount.
- Odd-even pricing
It is assumed that price will end at an odd number. It is a marketers pricing strategy. Because these types of pricing increase consumer sensitivity. However, consumers consider that odd prices are less than even prices. Moreover, odd prices are associated with lower quality and even prices are more consistent with higher quality.
However, Consumer interpretations of price are related to all types of pricing decisions.