Question

How might a consumer view a price cut as an advantage and how might a consumer view a price cut as a disadvantage? What is deceptive pricing?

Answer 1

Price cut as an advantage:

Sale on new products- A customer might consider a price fall as a sale in the store. This is the time when the consumer will go and buy more.

Old stock clearance- some shop owners reduce the price of products to clear the old stock. Some customers may go and buy those and some whose preference is new products will not buy them.

Price cut as a disadvantage:

Decline in Quality- consumer can see the price cut as the fall in the quality of products because according to them, no seller makes their product prices fall if it isn’t for the quality decline.

Brand value- consumers can see it as the decline in the goodwill of the company which can totally affect the sales of the company.

Deceptive pricing:

Deceptive pricing is a technique by which sellers try to trick the customers using deceptive means. They try to actually make the customers believe that they are paying less than what they are supposed to be. For example, discounts/sales with hidden charges.