Small Business Tip of the Day: Are You Discounting Yourself Out of Business? - Forum.web.com
Follow Us:
Small Business Tip of the Day: Are You Discounting Yourself Out of Business?
reducing prices, price cutting

Is your business blowing it by offering discounts too frequently, or discounting too deeply? Consider a study by the Journal of Consumer Research in which participants were offered a free or discounted package of spaghetti with the purchase of a jar of organic tomato sauce. Both groups were asked how much they would pay for the spaghetti individually. Surprise: Those who got the spaghetti for free with a sauce purchase said they would pay more than the ones offered only a discount. The study found that when a free product is paired with an expensive product, consumers assume the free item is worth more than if it were offered at a discounted price. Instead of lowering your prices, change your marketing campaign to accentuate what makes your business different and better than your competitors.

Rieva Lesonsky

Rieva Lesonsky

Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at rieva@smallbizdaily.com, follow her on Google+ and Twitter.com/Rieva, and visit her website, SmallBizDaily.com, to get the scoop on business trends and sign up for Rieva’s free TrendCast reports.
Rieva Lesonsky

Latest posts by Rieva Lesonsky (see all)

Rieva Lesonsky

Comments

Loading Facebook Comments ...
Join the Small Business Forum Community
The Small Business Forum is a place where small business owners can learn, ask questions, and share advice on how to succeed online
Skip to toolbar