As our economy dives deeper into recession, many companies are responding with changes in their pricing strategies. With funding drying up, startups such as SlideRocket and Get Satisfaction have introduced premium packages to deliver value and drive desperately needed revenue. Many startups understand that without a viable revenue - let alone profit - stream, the next round of funding may not come at all.

These price increases were probably part of their original strategies that were only accelerated due to the recession. On the other hand, we’re seeing more established companies like Sprint and Quiznos dipping their toes into price reduction. Price reduction makes perfect sense in a recession, but with the wrong messaging it may very well lead to an unwanted price war and commoditization of products and services.

So as we can see, there is no one-size-fits-all strategy when it comes to price changes. Many factors such as industry outlook, incumbent strength, and product maturity just to name a few, can also have a dramatic impact on pricing.

One note if you’re planning to change your price, especially if you’re in the B2C market, chances are your customers will blog about it, and the rest of your customers and competitors will find out. Be prepared for your competitors’ response, and to manage your legacy customers based on your previous pricing model.

###

About the Author

Yvonne Yuen is a senior product manager at Lyris. She is responsible for defining and delivering customer requirements which improve their online marketing ROI.

Related Resources:

• Subscribe to Inside Lyris HQ our monthly online-marketing newsletter.
• Download free online-marketing guides, tools and webinars in the Lyris Online-Marketing Resource Center.

Comments (0)

Subscribe to this comment's feed

Name

Email

Title

Comment

smaller | bigger

Add Comment