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Top1. Introduction
Pricing is a technique to decide upon the value that a company attaches to its product or service. The objective of every firm is to maximize profits (Cushing-Daniels, 2020). Pricing is the instrument through which companies achieve the goal of profit maximization. Pricing is the single most important aspect that decides the future of the product in the market (Gao, 2020). Consequently, companies require evaluating their pricing strategies regularly to align with the market and customer capabilities. The evaluation is more essential during crisis situations (Yılmaz, Ünal, & Dursun, 2019). During crisis situations like the present pandemic, most companies require reforming their applications and engagements with customers. However, many of the companies are unaware about the latest customer dynamics that have been shaped up by the pandemic (Lessard, 2019). Because of these reasons, despite having the willingness to reform, many small companies are not able to cater to their target audience.
Previous researches have emphasised on pricing techniques during normalcy and even during a crisis (Kim, Roehl, & Lee, 2019; Blinder, Ehrmann, De Haan, & Jansen, 2017). Given the unprecedented nature of COVID-19 and the turbulence created, there are unforeseen circumstances where normal rules do not seem to apply (Rascão, 2019). Consequently, it is imperative to conduct research on what pricing strategies companies should adopt during a pandemic. Coronavirus is shaking up consumer behaviour on a mass scale. While most of the economy’s wounds have been laid bare of late because of the pandemic, some have been affected less as compared to others in an era where businesses are closing, jobs are decreasing, and the economy is shrinking. There has been an unprecedented uncertainty in the market from the supply chain to the demands of the products (Bryce, Ring, Ashby, & Wardman, 2020). Multinational companies having a major demand for their products in the western markets, have their production centres in South Asia. This is one of the multiple examples of how globalisation has converged business in different countries. With the increased trade restrictions, most businesses have to take tough decisions. The consumers are not prioritizing luxury items for the time being in light of the increased tensions and recession that might succeed this pandemic. The COVID-19 pandemic is both a supply and demand shock. The pandemic has resulted in economic crisis because consumers have become cautious and thrifty.
The pandemic arising during to COVID-19 is a recent phenomenon. Companies are unsure about the pricing strategies they should adopt during this crisis. Few research studies have aimed at addressing the issue. The study aims at addressing this research gap.
The objective of the study is to understand the pricing techniques that would be taken up by companies during the pandemic and in a post-COVID world. The study also tries to address the feasibility issues related to the application of each of those strategies.
The methodology adopted is the conceptual and the qualitative analysis of the literature related to COVID-19 and the strategies companies are adopting to handle the crisis. Primary data was not collected, and empirical analysis was not done.