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Top 20 Marketing Mistakes: Number Three-Wrong Pricing Model

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Discounting is a mistake. Period.

The Wrong Pricing Model comes in third in our Top 20 Marketing Mistakes series. We previously discussed the top two blunders: having no marketing team and using we vs. you verbiage in marketing materials. But pricing actually IS marketing.

Think about it. Stores often categorize items by high, middle, and low-price cost.  And the human assumption, without fail, is always that the cheapest item probably has the lowest quality. When you buy a higher priced item, whether the quality is superior remains to be seen. What can be quantified, however, is that the marketing strategy behind the higher end ticket was superior.

There’s a difference between discounting and creating value. Discounting is the worst mistake that you can make in business.  Price-focused shoppers who aren’t loyal will only stay around when you offer more discounts, in which case, you’ve lost the customer and profit.

Adding value is giving something away that adds value to the overall sale but doesn’t cost you much. For example, if you pay $1,000 for a jacket and it’s discounted at 10 percent, you’ve saved $100. But if the seller instead includes a shirt worth a retail value of$140 (an item the seller paid $30 for) in the sale as an added value, the overall worth of the interaction is increased as well as the perception of the brand.

Remember, if you are cheaper than your competitor you are telling the market that you are not as good as your competitor. Price according to the market, not cost, or discounted competitor pricing. You can see the accompanying video for this blog featuring Brad Sugars here.


ActionCOACH, the world’s largest business coaching firm, was established and founded in Brisbane, Australia by Brad Sugars in 1993 when the concept of business coaching was still in its infancy. Since franchising the company in 1997, ActionCOACH has grown to more than 1000 business coaching franchises operating in more than 60 countries. ActionCOACH specializes in coaching small to medium sized businesses as well as executive teams and group coaching. ActionCOACH maintains its growth and strategic alliances by continual development of cutting-edge innovative technology, proven business processes and systems to add value, satisfaction and additional income streams for its franchisees.