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How Price Cutting Can Pay Off


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HOW PRICE-CUTTING CAN PAY OFF

While we wholeheartedly endorse Procter & Gamble Co.'s plan to enhance its corporate training program ("Ready, aim, market: Combat training at P&G college," The Corporation, Feb. 3), we challenge Chairman Edwin L. Artzt's statement that "too much price discounting erodes the value of P&G brands."

As a 30-year marketing veteran, I've observed strategically planned, disciplined price-cutting promotions that did not destroy brand value. In fact, especially in recessionary times, many brands that lack advertising support are surviving on price and value-added programs. Price cutting, indeed, can successfully slow down a brand's market-share decline. Additionally, it can provide brand management time to restore or reposition a brand for future vitality.

The spend, spend mentality of the 1980s is behind us. And cost-conscious consumers are looking for value. Smart marketers such as McDonald's are using "value pricing" strategies to their advantage.

William A. Robinson

Managing Partner

Robinson & Maites Inc.

Chicago


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