A Secret To Global Market Profits: Psychological Pricing
How to Profit in Global Markets with Psychological Pricing
Pricing products or services in new geographic markets may seem risky, but conducting research on psychological pricing can ease the challenge significantly. In fact, the right psychologica pricing strategies can make all the difference in the pricing successes of new offerings.
Often, companies scaling for growth continue with their traditional pricing strategies in spite of expanding to new markets. However, consumers in different locations around the world respond differently and every pricing strategy must be customized to ensure the best results.
Price Perceptions Change by Location
In Roger M. Heelers paper ‘High-Low Context Culture and Pricing-Ending Practice’, he outlines a simplified way to break down international market psychological pricing. The concept revolves around High- and Low- Contexts, and how much a particular culture draws meaning from their context, or just takes numbers at face value.
• In High-Context Cultures, there is strong attention to implicit and non-verbal cues from routine communication (such as prices). Many things are left unsaid but are never-the-less understood.
• In contrast, Low-Context Cultures can be simply understood as “what is said is what is meant”. Verbal cues are not used extensively to communicate.