Don't Raise Prices, Just Redefine Value!

I recently read a blog by John Quelch, a distinguished Harvard professor, offering advice to "marketers" who are faced with managing prices in inflationary times. One solution offered by the professor is to "redefine value" instead of raising prices, which appears to be corporate-speak for making your product smaller or cheaper, which Quelch says is "something the candy industry always does in response to inflation."

I'm not sure I'm a "marketer" (somehow that sounds offensive), but I am old enough to remember decades of shrinking candy bars. We always called that "cutting corners", not redefining value. Customers understand the need to increase prices; they just don't like to be taken advantage of. Making something smaller or cheaper and hoping the customer doesn't notice is insulting. Maybe the professor thinks the average Joe is too dumb to care.

I wonder how the professor would feel if his cardiologist or Mercedes dealer decided they were going to redefine the value of the products or services he purchased.