Consumers Shop Price More, But Industry Response Still Lags
// By Nancy Vessell //
For the past decade, David Marlowe, principal of Strategic Marketing Concepts, based in Ellicott City, MD, has encouraged health care providers to consider pricing their services more strategically in order to gain market share. Here he answers questions about the latest in strategic pricing.
First, what is strategic pricing, as opposed to conventional pricing?
The idea of pricing being strategic is to use price as part of the overall marketing mix. It’s done with the intent to drive demand. Or, it may disincentivize people to do something, such as placing high prices on cigarettes to discourage smoking. In most industries, price is often used for a strategic purpose – to create an image, to drive profitability, obviously.
What are the latest trends in pricing?
I’m still seeing continued growth in price shopping by consumers, along with industry recognition that it’s going on. Eight to 10 years ago, if you said consumers are price shopping, many in the industry would say, “No, not here; that’s just a weird outlier.” Now you can get them to acknowledge it. If it’s not formal price shopping, they’re at least getting phone calls in the finance and diagnostic imaging departments and doctors’ offices, asking, “What do you charge?”
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