product-pricing
We have all heard the references to quality, service, and price. The sciences of advertising and marketing explain that it is impossible to provide all three at the same time. Let’s explore this a bit. Let’s look at McDonald’s for instance. McDonald’s provides fast food very quickly at a fairly reasonable price; based on this principle it may be the quality of the food that is less than the other two measures of service and price. A contrasting example could be Starbuck’s coffee. At Starbuck’s they known for high quality coffee drinks provided quickly and kindly; based on this triangle these drinks cannot be provided at a low fee. We all know many of the coffee drinks at Starbuck’s can easily exceed $5 per drink. To provide another contrasting example, some businessmen enjoy having custom dress shirts. These shirts are comparably expensive and are of very high quality; these shirts cannot be obtained quickly as a result. The speed of service is compromised when compared to purchasing ready-made shirts at a department store.
According to this triangle of marketing, it may be the quality of the product or service that is compromised. Quality can be compromised at a by having lesser experienced support people, by providing lesser expensive manufacturing materials, and delayed deliver times.
“The triangle is a maxim that high-quality goods delivered quickly and efficiently to customers will always come at a higher price and vice versa.” That is the cold, hard definition of the unattainable triangle.
The triangle is considered to be “unattainable” because any business that attains it would be inherently flawed. For example, in an ideal world, businesses would produce high-quality goods at a fraction of the cost and time. Logistically, this theory doesn’t work. Think about what happens in the business world. Consumers associate high prices with high quality and cheap prices with low quality rather that is true or not.
Relying on sales volumes to sell products at a lower price point doesn’t work as efficiently as we would think. The notion of “too good to be true” plays a big role in the problem. To put this dilemma into perspective, imagine if BMW started selling their $50,000 cars for only $20,000. Wouldn’t you assume that there was something wrong with the car? Where did they start cutting corners? As consumers, we are trained to associate the price point with quality and speed. You get what you pay for, therefore, you must pick two of the three (quality, speed, price). What is more important to you?
If you are a business owner, your involvement in the triangle will depend on your values. The triangle allows business to take a step back and analyze their goals, their process and what your audience is looking for. If your audience is looking for a quality item and your goal is to create a quality item then all is well. But, if your audience is looking for a mid quality item with a fast turnaround and low prices and you have to ask yourself if it’s worth investing in this mindset and losing sight of your original goals and values.
The unattainable triangle is unattainable for a reason. Trying to implement all three is points of the triangle is bad business. If you’ve got an amazing product, why would you want to under sell it? Or if you’re able to deliver a fast turn around, why charge the same amount as competitors who are twice as slow? Customers are trained to associated price with quality and that is the main reason why the unattainable triangle may always be unattainable.
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