A few months ago, I decided to clean the cushion covers for my sofa. I brought them to a local dry-cleaner and asked how much it would cost. She couldn't tell me. She said they outsource them and she didn't know how much the third-party company charged.
I was dumbfounded. I couldn't get a fixed price - or even a range - for the cleaning.
I was even more stunned when the owner defended this crazy pricing policy by saying something like: "None of our other customers seem to mind. They trust us."
Well, in this economy, trust won't fly. Consumers are very likely to shop around for the best price, even among the places they frequent most. If they can't find a price they like, they won't buy. And, they most definitely won't take out their wallets for something that doesn't have a price tag.
Thus, I encourage all sizes of companies to do some rigorous competitive analysis. Determine how your pricing compares to others in your industry, and what incremental value you can add. Your good looks, charm and "trust" among your existing customer base isn't going to work now.Technorati Tags: customer retention, bad economy, price sensitivity