Sublime

Are there risks in doing this? Yes! If the potential buyer s with a willingness to pay $120 or more find a way to get the product at $90, our profits will look a lot worse than if we had a uniform price of $105.

“Companies that successfully avoid price wars consistently write and speak publicly about the horrors of price competition and virtues of value competition.

This makes signaling the method of choice if a company wants to reduce the risk of a price war.

If the government intervenes through regulation, taxation, or other barriers, the result is almost always an imbalance between supply and demand .

The Grand Complication reveals another fundamental characteristic of luxury goods: as price rises into the stratosphere, the number of units available also seems to disappear into ever-thinner air.

share the impact of the changes—whether positive or negative—evenly with your customers.

consider a crisis to be a collapse in demand.

Companies used to be able to command a premium price by simply showing up. There were relatively few players in any competitive arena, and customers held little power.

In former socialist economies, scarcity was an everyday occurrence. Lines were everywhere. People bought whatever they could get their hands on. One never knew what might happen.