What's your price image?

- Determining how to price your product and service is one challenge, but what about the way consumers perceive your prices? When a consumer interacts with your pricing model, they form an impression and this is typically referred to as the price image. So it's helpful to be able to answer the question, what is your price image? Picture in your head the most expensive grocery store in the United States. For many of us, that image will be Whole Foods. Now, Amazon has acquired Whole Foods and has been slashing prices, but that's beside the point. The important thing to consider is, is being seen as expensive good or bad for Whole Foods? If customers recognize and perceive Whole Foods as being worth it, then their price image is fine. The value is worth the cost. But if your price image is off the mark from customer expectations, then you have a problem. If you walked into Whole Foods and it felt and looked like, say, Walmart, well you might challenge the price image. Not only is the product offering important, but the entire consumer experience plays a role as well. Pricing is more than just managing the actual cost to your customer. You must manage all the mental associations customers are making with regards to your pricing. And keep in mind, that once customers have a mental model, it's hard to shake. This is why Whole Foods likely won't shake the high price image, even if it's starting to be competitively priced with other retailers. So as you can see, price image is just as important as your actual pricing.