What role does price play when negotiating and communicating value?

Expert Solution

Price negotiation is a common way for individuals to receive a discount off the posted price. However, not all consumers bargain when given the opportunity. For example, consumer reports indicate that 61% of consumers negotiate prices of goods and services and 33% bargain for expensive home appliances specifically.

Consumers become customers if they perceive good value from a potential purchase. Consumers will weigh up the potential benefits against the various costs of acquiring the product. As price is the most significant cost that consumers will consider, then the setting of price at a certain level will influence the perception of value.

For example, if a shop offers small pizzas for sale at $5, then many consumers may perceive value and buy one. But if the shop was to price the same small pizzas at $20, then most consumers would not perceive value and would probably not make a purchase.

jeff jeffy answered 2 years ago

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