Prestige Pricing
This article covers meaning & overview of Prestige Pricing from marketing perspective.
What is Prestige Pricing?
Prestige pricing, also known as premium pricing, is a pricing strategy where prices are consciously kept higher than normal for the entire product life cycle.
Normal trend is that marketers try to keep the prices of their product as low as possible. But there are certain class of people and certain products where the perception is that higher the price better is the quality of the product and thus higher the prestige associated with being the owner of that product. Owning such product is a sign of self worth and flawless performance. For these customers, quality is directly proportional to price.
Higher Price = Higher Quality= Higher prestige
In case of these products, lower price leads to lower sales. Higher price serves as the motivation of the customers to buy that product. Selling at a high price creates an aura of superior quality and social status. Some very general examples are perfumes, automobiles and watches. High price in these segments plays with the psychology of the buyer and thus helps reinforce the luxury and classy image of the brand.
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