In the morning while going to get something to eat, me and my friend crossed past many big bright yellow boards with big bold red fonts announcing some kind of sale. There was nothing striking in these boards, but still something remarkable happened that prompted me to write this post. The thing that prompted me to write this post was an innocent question that came from my friend. He asked, “why do company need to put the prices of its products so high that they have to give 60 percent or 70 percent discount to make a sale?” This was an interesting question, and this post is the answer to that question, and I am not expecting my friend to read this answer, as he has nothing to with marketing and stuffs related to it.
Well, keeping a low price and discounting the high price are two different marketing strategies aimed at two different sets of consumers; which of the two options you choose will not only decide who will come to buy at your store (customer) but it will also decide which battle field you are into (market segment), and against whom you have to fight (competition).
Demographically speaking, both the low price and the discount price are targeted towards the group of consumers who fall into low-income groups. If both the strategies are used to target value for money segment then why to use discount pricing, and why not to stick to just low pricing? The demographic target of both the pricing strategies may be same but the psychographic (how the consumer sees, observes, feels, or reacts to certain stimulus) target of both the pricing strategies are different.
Through the low-price pricing strategy the company is targeting those low income groups that purchase products just to satisfy their basic needs. They look for basic quality and basic designs. But even in the low income groups there are individuals who aspire to wear like someone else, may be sports star or movie celebrities. These groups look forward to imitate the clothing pattern of rich and famous. The people in these groups like to wear clothes that are aspirational in nature. The discount prices are targeted to this group of people.
The discount price works on two levels. On the first level, the company builds aspiration in the product by fixing a high anchor price; and at the second level, by discounting this price by 50, 60 or 70 percent, the company is making this product accessible to this group. Discount pricing in a sense is a strategy used to make an aspirational product accessible to the target audience.
Tags: Celebrities, Clothing Pattern, Consumers, Demographic Target, Fonts, Income Groups, Innocent Question, Market Segment, Marketing Strategies, Money, Pricing Strategies, Pricing Strategy, Psychographic, Sports Star, Stimulus, Store Customer
Everywhere in the world today, people are becoming submerged in debt. Everywhere you look, it is possible to purchase today and pay tomorrow, consumers are steadily falling into this trap everyday, and before they know it, they are so far in debt they are unsure how to get out. This is where debt counseling comes in; however you need to be made aware of debt counseling frauds. Some are only in place to take your money.
Legitimate debt counseling companies do not claim to be not-for-profit if they are not. There have been cases where a company has claimed this and ended up swindling their client’s money. There are ways to protect yourself; you should check a debt counseling company’s reputation thoroughly before investing your time and effort into them.
Never conduct business with a company that requires any upfront fees or asks you for voluntary contributions. This is a red flag, legitimate debt counseling companies advise you on money management, budget development, debt and educational material and occasionally workshops.
Essentially, it is none of their business regarding the details of your situation or requires you to be approved. They should discuss your financial situation and help you in developing a plan to eliminate the problems.
You can also check your local government agency or better business bureau, to ensure that they are indeed legitimate and no complaints have been filed against them.
The other things that will tell you rather or not a debt counseling service is legitimate include the following things. If they promise lowered payments, leave, only interest rates can be lowered not payments. If they ask you for your account numbers prior to giving you a quote, this is not necessary at all. If they group the quotes together instead of giving you a breakdown of how each creditor will be handled, this will leave you with no idea of how long it will take to pay off each account.
There are also questions you should always ask when choosing a debt counseling service. These questions should include charges for educational material, a disclosure in writing of fees that are charged, if they are properly licensed to do business in your area, what will happen if you cannot afford their fees, what type of services do they offer and if the counselors are certified and who certified them. This is your money and your financial well-being, do not leave any stone unturned.
There is a new bankruptcy law that makes filing bankruptcy harder for everyone. To file a chapter 7 will be nearly impossible if you are currently employed. They have formed a test that you will have to pay showing that your income is less than the median income for your area. Along with these new laws, it has become required to obtain debt-counseling services when filing bankruptcy.
Choose the debt counseling company very carefully and ensure they are legitimate. You do not want to cause more harm or damage to your credit, so choose reputable companies wisely.
Tags: Account Numbers, Better Business Bureau, Budget Development, Consumers, Counseling Service, Creditor, Debt Counseling, Educational Material, Financial Situation, Frauds, Interest Rates, Legitimate Debt, Local Government Agency, Management Budget, Money Management, Red Flag, Reputation, Upfront Fees, Voluntary Contributions, World Today
