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Global brands – and the problem with geographic pricing

September 4, 2007

If a brand is global – is it fair/wise to have isolated geographic pricing?

“Take this example of Oral B

Oral B Classic vs. itself
This toothbrush appears to be a legitimate Oral B product-and it is. But close inspection reveals it should be on a shelf 8,000 miles away. The small print on the back says “Not licensed for export beyond India, Bangladesh, Sri Lanka, Nepal and Maldives.” Selling illegal imports in bulk may keep the price below a dollar, but its unfair to the domestic model, which sells for $2.99 at the pharmacy down the street.-JEROMY LLOYD”

Source: http://www.marketingmag.ca/magazine/current/feature/article.jsp?content=20070910_70136_70136

or legitimate international (Far East) DVD’s that make it into the North American market at a fraction of the price of the domestic versions.

This is a problem in all corners – see for example this review of apple and corel software pricing from around the world. http://www.amanwithapencil.com/adobe.html

For more background on the controversy and the pushback consumers are starting to take – see: How fair is geographical pricing on the internet?  http://aralbalkan.com/918

What about the impact this has on the customer’s perception of the brand promise? Wouldn’t it significantly erode any confidence in the value proposition?

Is this a smart ROC strategy?

The last thing any consumer wants is to feel like they’ve been taken advantage of. That’s akin to a promise broken.

Within a web 2.0 world, word will spread and then no amount of wishing will put the genie back in the bottle. 

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