What he was
saying, though, is that if they
really did magically attract women all of the time, you could charge whatever
you wanted to because people would pay anything to have them (high demand). In that sense, it is true. However,
since they don't work like that, you have to be more reasonable with the price. That's why I listed all of the
factors because even in my scenario (love potion), competitors would eventually cut in and lower the price.
The best example of pricing strategies: Laser eye surgery.
Laser eye surgery takes about 10 seconds and
probably costs doctors a few dollars to do (not sure how much the machine costs, but if you do it on ten thousand
people, I'm sure the economies of scale minimalizes the cost per patient...and even if the doctor charged
$100/minute for his time, you'd still only be down $200 for the two-minute procedure). However, they still charge
$2,000 for it. Why? No one will pay less because they think they're getting bad surgery. No one is willing to pay
less for it because it's too big of a gamble on your sight. The eye doctors came up with one solution: charge that
amount but give everyone coupons so it's like you're getting something
worth $2,000 for less. Look for
Christmas 50% off specials during the holidays.
Moral of the story: Companies that charge less give the
impression that the results aren't as good. What LP's friend was saying is that because -mones are cheap (I still
feel my wallet getting lighter, though...don't know what he's talking about
), they must not be as effective as
they claim.
*sigh* That's consumer psychology for you. I'm more of a, "It's cheap? It does the same thing as
expensive stuff? I'll take it!" kind of guy myself.
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