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Pricing Strategy: What should I do if the lowest price I can charge for some of my products is still twice to three times higher than that of my competitors?
JM
JM
Jon Manning, Pricing Strategist / Author / Mentor answered:

In the 1980's, there was a famous experiment conducted: the "Beer on the Beach" experiment. If you and I are sitting on a beach on a hot day, and I say to you "I'm going to the 5 star hotel at the end of the beach to get us two ice cold beers...how much are you willing to pay?" You'd say (in 1980's dollars) around $2.60. I then tell you I've changed my mind and I'm going to the run down grocery store at the other end of the beach and they have exactly the same beer at exactly the same price. How much are you prepared to pay now? You'd say ~$1.50. There is no logical or rational difference in the willingness to pay, other than the context or environment in which the purchase is being made. How do you make yourself the 5 star hotel?

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