Try to take a look at something closely; the thing might be something that you wear. Have you ever ponder what actually represents the price of an item? (It will give you more thinking point if you buy the product by your own money) For example a retail price of a Nike shoe is $89.90 but does any part of your shoe justify the exorbitant amount you are paying? Is the total cost of all components of a shoe such as the laces, sole and material used justify the price or is the extra we are paying for is actually the price of the “swoosh” sign?
Nike fans will argue that that the technology or quality of the shoes represents the price. This is after they test it at the shop and they feel comfortable with the product they are about to buy. People with the same view will also mention about the lifespan of the product that is as compared to store-brand footwear, Nike shoes have high durability and can withstand any condition.
Others will say the brand itself represents the price and that they can find the same type of shoes under a different brand at the cheaper price. Since almost everybody in the world knows Nike (if you don’t know please stand in the middle of the tramline and wait for the tram to hit you, LOL), they are able to extract a higher price from the customer. Come to think about it; is it worth to pay for $89.90 for a simple tick logo and four letters of brand name? You might spend around $10 to $20 for each character.
Or maybe we can combine both factors, but can you really figure out which one that really represents the price tag of the product? Or which one is more dominant for the price? Things to ponder.
But if we take a look at the service industry, the pricing of a service is even more a mystery. For example, the prices of Great Ocean Road (GOR) tour vary from $20, $125 and $160 per person for Deakin Graduate Business (DGB) Society, Go West Tours and AAT Kings Tours respectively. Assuming that DGB society is not operating for profit, the total cost per person is just $20. Then, how would you justify the price of Go West Tours and AAT Kings Tours that is 6 to 8 times more than DGB’s price?
Legends: Question to yourself, talking points & try to pull a funny stuff, LOL
Written by: Abyan and Aizat