Yesterday I was hit by one of my usual late night marketing strokes, this time about iTunes´ price policy.
I´m still hesitating though to how I should name this post:
- The importance of price setting: powerful marketing victim of its own success
- Why I think the price of an iTunes track is a value that should be quoted on the stock exchange.
Steve Jobs is a man of great talent. And yet, he deserves one further award for generating the only permanent psychological price the world of marketing has ever seen: 0.99€.
Indeed, of all things on earth, an iTunes´ track is definitely the only product whose price has remained strictly unchanged all through the years, no matter what crisis the music industry was going through. Almost more important than the brand iTunes itself, the price of 0,99€ has become so strongly associated to the brand that it has almost taken over it, so that in 2009, when iTunes decided to increase the price from 0,99€ to 1,29€, sales dropped. See Billboard´s article here (http://www.billboard.biz/bbbiz/content_display/industry/news/e3i7917210cb575a9b91b4543e3d671922a)
So Steve, congrats on one side for achieving the one and only permanent and immutable price EVER. But on another hand, hasn’t iTunes´ admirable marketing and powerful price policy proved so influential you kinda shot yourself in the foot? Not setting a variable price from the beginning and now not being able to change it definitely attests for a loss of opportunity on the profit-making side.
Maybe I should have named this post: Powerful marketing or how a psychological price can take over a company’s profits.
Maybe Zuckerberg will come with an idea.