When many of Swazi based companies find its major competitors offering a similar product at a lower price, the natural tendency is to try to match or beat that price. Although the idea of undercutting competitor's prices and watching customers flock to you is tempting, there are dangers which company owners must choose to avoid.

Successive rounds of price wars that erode the profit margins of all competitors within an industry in Swaziland or worse, discounting a product can cheapen it in the minds of customers, greatly reducing a brand's power to maintain profitability prices in the long term. It ends up being a losing battle; a company might find itself focusing away from quality, service, and prestige - the things a brand should be all about.

So, how can a company keep its pricing power when a competitor undercuts its price?
Note: in a research conducted by Knotell for a client some time ago, some customers felt that the price is too high as compared to other similar brands that offer equally competitive quality. Our recommendation was not to price below the competitor [s], but rather to price above and convince their customers that the product is worth it.

First, marketing executives should understand the value of their products/brands to the customers and then stand up for what the products are worth. In this way they will shift the focus from price to value.

So if the marketing activity taking place in a company is to create a superior value for customers. Developing value-added features and services that differentiates the offer and justify the prices should do this.

Pricing strategies in Swaziland

By: Mfundo Mavimbela