Know-How Exchange : Strategy

It is no wonder that an entrant resorts to price cutting policy.It happens quite often.What do you know about your competitor? What is their cost structure? What do you think their reaction could be if you retaliated cutting your prices accordingly? Can they afford deeper price-cuts?
Have you carried out a conjoint analysis to find out why clients go for your treatment? I would not take anything for granted and say that costs are not important to your prospective clients.Make sure what lies behind decision-making of your target groups. You may find some of the factors quite surprising.
How much do you spend on advertising versus your competitor? Is PR an important factor of their strategy?
How many success stories and your brand advocates stand behind you and how strong is your presence on the market?
What share are you prepared to lose due to their aggressive pricing and what could make you change your mind?

Rgds

Adam

Hi,

Be careful in going for an all-in-one' or 'package' strategy as a response!

Shoppers apply a "zero-sum heuristic" to their buying decisions - they may be willing to believe a service is great at x-attribute/key customer value--but they account for this excellence by assuming it's not-so-good at other things. You must make certain, therefore that the 'other things' you are adding are perceived by customers as 'very good' as well.

Greg

Competing on price is a losers game -- and your competitor will find that out when someone beats their price.

My message would be what price would you put on your eyes? Talk about your doc, your experience what it takes to me a Lasik clinic. I talk about the blended price. Your competitor might be offering one cheap get them in the door price-- but does that include everything you do?

Carol
Sell Well and Prosper tm

I agree with what others have said. To clarify a bit - they are saying that being a low cost leader when you are talking about your customer's eyes is not a good place to be. Instead, you definitely want to be known as the o e who is the highest quality, best success record, and best safety record.

I still wear glasses, because that slight risk of y eyes coming out worse is enough to keep me from wanting to try to make them better. The cost to a client of a botched Lasik job is huge.

This all comes down to your "brand" - how people perceive you. Having a longer track record is one way to show this (the new company does not have this).

You can do a variety of marketing which will hep shape how people perceive you. You want to be known for quality and high customer service. make sure you are this, and then start letting people know.

i dont think that you should respond to them by changing any of your existing strategies in a hurry .
1 st find out how there entry has effected the market ,how are people reacting to it.use word of mouth to spread your effectiveness rather than reacting to them in any way beacause if you are reacting to them you are hampering your own image.
so first find out the reaction of market to them and then react.

Decide what you're good at and known for.
Stick to it.
Find user-friendly ways of saying it.
And never, ever talk about price - you'll only give your competitor leverage.
When you talk about price, you make it easier for them to talk abot delivering the same quality service, for less.

If you were first in your area, then great: find a marketing mountain that you can be top of, and share the view with your customers.
And don't look down & talk about the other guys!