Yet, cutting prices is often not the best answer. Reducing prices unnecessarily can lead
to lost profits and damaging price wars. It can cheapen a brand by signaling to customers
that price is more important than the customer value a brand delivers.
Instead, in both good economic times and bad, companies should sell value, not price. In some cases, that mean selling lesser products at rock-bottorm prices. But in most cases, it means persuading customers that paying a higher price for the company’s brand is justified by the greater value they gain.
Yet, cutting prices is often not the best answer. Reducing prices unnecessarily can leadto lost profits and damaging price wars. It can cheapen a brand by signaling to customersthat price is more important than the customer value a brand delivers. Instead, in both good economic times and bad, companies should sell value, not price. In some cases, that mean selling lesser products at rock-bottorm prices. But in most cases, it means persuading customers that paying a higher price for the company’s brand is justified by the greater value they gain.
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