PRICE COMMUNICATION

Although it is easy to understand how value can be influenced, particularly the perceived value of psychological benefits, prices would seem to be hard data that are relatively easy to compare and communicate. But research over the years has repeatedly shown that people do not necessarily evaluate prices logically. Customers can perceive the same price paid in return for the same value differently depending on how it is communicated. We will examine four aspects of price perception and their implications for price communication: proportional price evaluations, reference prices, perceived fairness, and gain-loss framing.

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