Bringing Science to the Art of Strategy

Framing and perceived value are everything.

The team learned that at $18.99, consumers were crossing over from prestige department and specialty stores to buy Olay in discount, drug, and grocery stores. That price point sent exactly the right message. For the department store shopper, the product was a great value but still credibly expensive. For the mass shopper, the premium price signified that the product must be considerably better than anything else on the shelf. In contrast, $15.99 was in no-man’s land—for a mass shopper, expensive without signaling differentiation, and for a prestige shopper, not expensive enough. These differences were quite fine; had the team not focused so carefully on building and applying robust tests for multiple price points, the findings might never have emerged.

Source: Bringing Science to the Art of Strategy

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s