How to win back fast-food customers after years of rising prices
With rising prices over the past few years, how can fast-food restaurants regain customers in a price-sensitive market?
We’re proud to share that Gerard Loosschilder and Juan Andrés Tello from SKIM were asked to contribute to Chain Store Age online. In the resulting article, Gerard and Juan share insights on how to set the right price in balance with the value of your brand.
The Tipping Point of Price and Perceived Value: What is the Right Price?
Setting the right price is vital, because price is a key marketing lever and it expresses brand value in a competitive context. The question is: how far can the brand increase prices while securing revenue? The answer is: up to the point where the price change is no longer offset by the perceived value of the product or service. The tipping point depends on the brand’s and product’s price elasticity. The brand can only raise prices without being penalized if elasticity is low.
The key is to focus on setting the right price in balance with the brand’s value. SKIM’s recent meta-analysis of over 200 pricing studies provides valuable insights on how to achieve that balance. The analysis covers a wide range of categories, brands and retail channels across countries. Here, the focus is on variations in price elasticities across retail channels. The results are applicable to virtually any retail brand.
Our authors
Gerard Loosschilder, Partner and Chief Methodology Officer
Juan Andrés Tello, Director Americas
Watch our recent webinar for more
Are you interested in learning more about this topic? We recently discussed it in our fall webinar cycle. Watch the recording and download the slides here on our website.
