In an increasingly crowded and saturated smartphone market, the strategies adopted by brands to be able to convince users are becoming more daring every day. One of these we call, among us, barred pricing policy and consists in creating the conditions to generate a so-called “FOMO“, fear of missing out (fear of staying out, or of missing an opportunity) with the aim of maximizing sales in a short period of time, which normally coincides with the product launch.
Almost all brands, some more, some less, have become the protagonists of the barred pricing policyactually a trick as old as the world, so much so that the problem is not so much in the marketing strategy itself, but rather in the frequency and systematicity with which it became part of the smartphone sales proposition.
A PERVERSE MECHANISM
Without going into too much detail, since I would like to leave the matthew-thought to the video, I’ll briefly explain what we mean internally by “crossed out price”.
Smartphone X of the Y brand, with a certain list price which at its debut on the market is discounted by an important percentage. Let’s say that the list price is 549 euros (it’s a real example, which happened a few days ago), on the launch day and for the following 48 hours that price is cut to 399 euros. Here, 549 euros in this sense is the crossed out price: 549 Euros for 48 hours 399 euros.
The prospect comes in somehow captured by an attractive price and finds himself pressed by urgency of the decision given the limited period of the offer. The product is then hardly found at a discounted price in the following weeks, or even disappears from circulation, until, after a few months, it is replaced by a new smartphone discounted at launch almost the same as the previous model.
Discounts, launch promotional offers or sales linked to particular events are certainly not new, on the contrary, they are welcome for the user who can and knows how to wait, because they allow you to save something compared to the list prices. A typical black friday it is built largely on the FOMO, but it remains a limited and circumscribed opportunity. As I said, in fact, the problem arises when this modus operandi it becomes systematic.
In fact, price positioning is a serious matter, we talked about it in a special some time ago: establishing the value of a product is very important for the brand strategy and it can affect the whole market. Think of Apple which has always established that its products must be expensive and how this choice has influenced their success, or OnePlus which over time has lost the trust of the community, betraying the positioning of the first “flagship killer”, but the world of technology is studded with these examples.
The list price has a strong meaning also for us who have to evaluate the product and for the user who mentally sorts his wishes according to the budget he has decided to allocate. Here, creating confusion with the positioning creates several problems, harms the market and the end user, as well as push for a completely unjustified consumerism in spite of the ethical and environmental sustainability of which many hypocritically make a slogan.
In the video below I will talk about all this in more detail and propose some countermeasures. Appointment in the comments box, curious to know your opinion.
