ABSTRACT
Most of us are attracted to certain products and services by their price. If the price is outside our reach we don’t even consider the product or service, whatever its quality, except perhaps to form an opinion about it. We also rely on price as a comparison, hoping that we can obtain the same characteristics at a lower price. In the luxury goods market, a high price is often a mark of quality but occasionally it is a confidence trick aimed at making more profit for the supplier. When certain products and services are rare, the price tends to be high and when plentiful the price is low, regardless of their quality. One can purchase the same item in different stores at different prices, some as much as 50% less, many at 10% less than the highest price. You can also receive a discount for buying in bulk, buying on customer credit card and being a trade customer rather than a retail customer. Travellers know that goods are more expensive at an airport than from a country craft shop. However, in the country craft shop, defective goods or “seconds” may well be on sale, whereas at the airport the supplier will as a rule want to display only the best examples. Often an increase in the price of a product may indicate a better after-sales service, such as free on-site maintenance, free delivery, and free telephone support line. The discount shops may not offer such benefits.
