Brand Strategy: why its dangerous to compete on price
So let’s say your selling widgets. Your widget is the same as everyone else’s widget. Why then do people then choose to buy your widget? Maybe like in the old school advertising model, you are smothering the world with your widget and aim to get market share through mass exposure. Otherwise you are competing on price? How will that work for you? What are your competitors going to do when you drop your price? Drop their price? Then what do you do next?
This is called a race to the bottom. A price led strategy may work once or even twice but doesn’t help in the long term plan of a business. You need to give people a reason to believe in your brand and you need that competitive advantage that doesn’t just compete on price. So a good brand strategy involves looking at the bigger picture and understanding that the dangers of competing on price not only risks the race to the bottom but also gives people the perception that you are a cheap and possibly low quality brand.
At Brandjams we move you from a what based brand to a why based brand so your business doesn't become a commodity. By finding the true value in your business, you wont need to compete on price.