The Price Paradox

There’s no excuse for staying sober these days…there really isn’t.

I went into my local mini-market the other day, to find the cheapest bottle of booze in the shop. I did have my reasons, but they’d take too long to explain. Suffice to say that it had nothing to do with falling on hard times or being a raging alcoholic.

Anyway, I didn’t have to look too far to find what I was looking for…a two litre plastic bottle of 7% white cider for £2.06. And this is in Sainsbury’s! I’m sure those ‘in the know’ will tell me that I’ve been had ~ that I could have got it a lot cheaper somewhere else ~ but to me, it seemed a ridiculously small amount of money to pay.

Given that a large proportion of the population drink alcohol with no higher ambition than to get drunk, you’d expect that this is the sort of stuff that everyone would be buying. It probably doesn’t taste much different to the alternatives, (no, I didn’t drink it) and will certainly fulfil the brief as far as getting drunk is concerned. And yet the only people I’ve ever seen buying this sort of thing, are youths in hoodies and middle-aged blokes in second-hand suits who promptly drink it straight out of the bag.

Why is this?

When I studied economics, many years ago, one of the few useful things I remember is the concept of reverse elasticity of demand. With most products, as price increases, demand falls. But some products are different. If you lower the price, then you also lower demand as well – particularly amongst certain groups of consumers. There can be several reasons for this:

 A low price is equated with unacceptably low quality.

.  Image is a key factor with many products. Cheaper products have a poorer image.

.  Products are bought as gifts. Nobody wants to look a cheapskate.

Would you want to take a £2 bottle of booze to a party? I did, but then I’m a little bit strange. I must confess to being even a little embarrassed buying it in the shop though.

The point I want to make is about price – and most specifically the prices you charge for your products or services. It’s very easy to get locked into a mindset that says that lower prices will lead to higher sales, or conversely that higher prices will result in lower sales. The truth is far more complex than that. It depends on the characteristics of your product, how it’s marketed and who you’re attempting to sell it to.

Very few businesses do enough testing of the effect of a change in price. Those that do are often surprised to find that the effect is not what they expect. It’s totally counter-intuitive to think that an increase in price might actually boost sales, but in the right circumstances, it can. And you won’t know whether this applies to you, until you test.

Now you might decide that you’re happy to continue selling to your market’s equivalent of hoodies and vagrants. It might be a very lucrative market for you. But the option to do something different ~ to find a larger market at a different price point may be there.

In the case of the white cider I bought the other day, it might take little more than some new packaging, and a more sophisticated label to double or treble the price, and find a whole new market…

Because where pricing is concerned, image and perception are what really matter. 

Kind Regards

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John Harrison  

PUBLISHERS NOTICE

PUBLISHERS NOTICE  

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Dear Streetwise Customer

I hope that you and your family are well. 

I don’t have to tell you that the Coronavirus outbreak has changed everything, and nowhere more so than in the world of sports betting. With almost all our regular ‘go to’ profit makers like European football, horse racing and golf on hold, you might be excused for thinking that the opportunity to make a lucrative extra income from sports betting was gone – at least for now. 

That’s what we thought until we heard from a guy called Craig Russell and how he was…

Making an extra £150-£250 a week exploiting the ‘invisible’ betting opportunities exposed by the Coronavirus mayhem.

You see Craig isn’t your typical sports bettor. Long before anyone had heard of coronavirus, he was shunning the sort of events most of us bet on in favour of little-known sports, events and fixtures taking place in obscure locations.

Why did he concentrate on those? 

Because he figured that the less ‘pro’s’  there  were  looking  at  these  obscure markets, and the more time he spent studying them, the greater edge he’d have over the competition. 

Obvious when you think about it. 

So why this message? 

Because it seems like now is the perfect time to bring this to a wider audience…but not much wider! 

You see, in conjunction with Craig we’ve put together a totally unique service which is tailor-made for the times we find ourselves in. But there will only be 100 places available. Ever.

For full details on what’s involved and why the limit, take a LOOK NOW.

If an extra couple of hundred pounds tax-free income would be worthwhile to you right now, I’d urge you to get in touch without delay. These places are really going to go fast.  

  For full details CLICK HERE

  Very Best Wishes, 

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 John Harrison
  Streetwise Publications 

P.S   Almost forgot…you can get started with this for just £9.95.  I’m pretty sure that makes it our cheapest service ever. Why? Well take a look now and all will be revealed.

www.streetwisenews.com/LP