How Do Consumers Process And Evaluate Prices?
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Based on Chapter 13 of Marketing Management : An Indian Perspective by Kotler, Keller.
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How Do Consumers Process And Evaluate Prices?
- 1. How do consumers process and evaluate prices?
- 2. By, Anurag Kar B.Tech. Student Department of E and ECE IIT Kharagpur Based on Chapter 3: Developing Pricing Strategies and Programs Of Marketing Management: A South Asian Perspective By Kotler, Keller, Koshy and Jha
- 3. Customers today have many ways of differentiating between sellers because of THE INTERNET
- 5. Buyers today can: 1. Get instant price comparisons between vendors. 2. Name their price and have it met. 3. Get products for free.
- 6. Examples
- 7. Earlier Buyers were “price takers”. They accepted prices at face value.
- 8. Now.. Buyers process various information and access various options.
- 9. Let’s understand consumers’ perception of prices with the help of 3 sub topics
- 10. Reference Prices
- 11. Consumers often can’t accurately recall specific prices. While examining products, they employ reference prices.
- 12. They compare an observed price to an internal reference price or external references such as “posted retail price”.
- 14. Consumers often use price as an indicator of quality.
- 15. ₹ 3000 It’s so sophisticated. It has to be good. Wow! This shirt is so good. Because it’s expensive.
- 16. ₹ 300 It’s so dull. It’s cheap. Ew! This shirt is bad. Cheap shirts are never good. .
- 17. Price Endings
- 18. Many sellers believe in ending prices with a ‘9’. Such as ₹ 299 or ₹ 499 for a commodity.
- 19. This is because people tend to process prices from ₹ 2 9 9Left Right
- 20. ₹ 2 9 9 Ends up being in the 200 range Rather than the 300 range.
- 21. Companies who want to portray an expensive image on the other hand should AVOID such pricing because of the risk of looking cheap.
- 22. Recap
- 25. Pictures Sourced from: www.flickr.com www.pinterest.com http://commons.wikimedia.org www.theguardian.com Fonts Sourced from: www.fontsquirrel.com Based on “Marketing Management: A South Asian Perspective” By Kohler, Kelter, Koshy and Jha Credits