Magazine article Marketing

Why Price Wars Are Here to Stay

Magazine article Marketing

Why Price Wars Are Here to Stay

Article excerpt

Why price wars are here to stay

A mosquito has a lifespan of a few days. A bee, a few weeks. A sparrow three of four years. Like all things in nature, including economies, they operate according to their own timescales.

Talk to the mosquito about winter and it won't have a clue of what you are going on about. Similarly, human beings are familiar with days, nights and seasons but long term climactic trends like "global warmings" or "ice ages" are beyond our ken.

Talk to many marketers about marketing in the 90s and they may be similarly flummoxed. While every business conversation turns on the upturn and when it will come, the unstated assumption is that the underlying climate remains unchanged.

It may be a mistaken assumption. Recessions are like waves. They may be exceedingly powerful and damaging. But they are essentially short term.

What makes this one so bad is that the underlying economic tide is also turning. Take some of the signs.

Like the 20s, the 80s saw a bonfire of controls. The experience of the 30s saw their re-establishment. That process is just beginning. Like the 80s, the 20s saw a great flow of wealth from poor to rich. Subsequent decades were spent reversing it.

Similarly, the 80s saw the longest and largest ever accumulation of personal and corporate debt. …

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