The soul of marketing is how to sell the price Kotler said marketing is not selling products, but selling prices. Jin Huanmin put it more bluntly: sales sell products through price, while marketing sells price through products. There are many sayings about marketing, but Jin's "selling price" theory is interesting and classic. People with a product-selling mindset like to use price tactics, such as price cuts, discounts, promotions, etc. These are all price reductions or disguised price reductions because they are the simplest and most effective. But the negative effects are also the most obvious. At the beginning of my marketing career, Jin Huanmin and I had a common rule: anything can be negotiated, but price and payment terms cannot be negotiated. We called it the "two no-negotiations." Here, payment terms are actually ancillary terms of price. First set the price firmly, then find ways, but not through price. That is marketing thinking. Jin Huanmin also said: pricing determines the outcome. Pricing is strategy, high price is grand strategy. This shows how important price is. Sell the product at its worth The so-called selling price means generating a premium. The so-called premium means selling at a higher price than others. If a brand has no premium, it is hard to call it a brand. To sell a product with a premium, you also need to make consumers appreciate it and be willing to pay. This requires proving that the premium is worthwhile. So, selling price is through a series of activities to make consumers feel that the product is worth such a high price, and that the high price is more cost-effective than a low price. What activities can prove to consumers that the high price is worth it? That is the mystery of marketing. The contrast between marketing and sales is hard for many to explain. Through Jin's "selling price" theory, it is easy to explain. Sales often sell products cheaply, while marketing sells products at their worth. Price is an efficient means Why do salespeople like to use price tactics? Because price is an efficient means. As long as you cut prices, discount, or promote, sales immediately pick up, with quick results and obvious outcomes. So, when sales encounter obstacles, the sales department immediately thinks of price tactics. In some companies, this has become a habit. Be careful: price tactics easily create dependence. It's like drug addiction; it becomes addictive and hard to quit. Although price tactics are efficient, they easily create dependence, so the next round requires a larger dose, otherwise it becomes ineffective. That is dependence. Once price tactics create dependence, they change the break-even point. Companies are so sensitive to profits that once prices are lowered, they look for ways to cut costs. Cutting costs easily affects quality. In the end, you find that price tactics gradually push the company toward the edge of a cliff. I once asked in class: If sales decline, what do you do? The answers students could think of were nothing more than advertising, price cuts, and promotions. In fact, two of these are disguised price cuts. My response was: Even without professional training, you can think of these three methods, so they are not professional methods. If you encounter such problems in the future and answer like this, don't say you are my students; I can't afford the shame. Value is a lasting means People sensitive to price will repeatedly chase price. For example, customers attracted by low prices will leave for even lower prices. In other words, price does not bring customer loyalty. I had a saying long ago: "Low price is easy first, hard later; high price is hard first, easy later." Low price attracts customers easily, but retaining them is hard; high price attracts customers with difficulty, but retaining them is easy. Low price generates price recognition, while high price generates value recognition and quality recognition. So, once marketing that makes products worth the price reaches a critical point, it is hard to reverse. Price disrupts competitors and also disrupts yourself I once told a case in an article. A salesman asked the boss: A local small factory has a very low price and is very powerful. What should we do? The boss replied: If its price is so powerful, why is it a small enterprise while we are a large enterprise? This is a case I personally experienced. The person who answered this question is me. When writing the article, I used the boss's tone. This case shows that price disrupts competitors and also disrupts yourself. Disrupting competitors is temporary, but disrupting yourself is permanent. Now, that once powerful small enterprise is nowhere to be found, while the large enterprise is still growing rapidly. If you ruin the price, competitors may only suffer for a while, but you may be not far from death. Price determination In the past, big brands had price determination, while small enterprises did not. So, small enterprises were gradually eliminated. Recently, because the industry total has peaked, large enterprises generally face sales difficulties, and they are also losing price determination. Once price loses determination, it is easy to cause a price collapse, which is more terrifying than a sales collapse. A sales collapse can be saved by many methods. Once price collapses, consumers will flee faster, and there is no way to save it; it's hopeless! The product upgrades in recent years have confirmed that the past common "distribution + promotion" tactics no longer work, and price no longer has the power to drive sales growth. But how many marketers realize this problem? In the past, for subsistence product marketing, since the overall income of consumer groups was not high, price tactics could often work. But facing the consumption upgrade driven by the rise of the middle class, price tactics are becoming a negative means. If not used, fine; once used, it gets worse. Price "loss of chastity" is serious In the past, small brands lacked determination; now it is common for big brands to lack determination, and they generally "lose chastity." Now, what can press distributors to the point of bursting? It is precisely price tactics. Why is the "second-tier wholesaler" returning? Because of tiered sales policies. Tiered sales policies used to support large customers, but now they disrupt prices. Because of tiered policies, cross-channel dumping on B2B platforms has become relatively easy. If you continue to use price tactics, and the price is ruined, you are not far from death. Source: Teacher Liu's Forum (ID: liuchunxiong1964) -END-