An assessment of the influence of pricing strategies on consumer perception of product excellence during economic downturns: A study of an FMCG product in Kaduna, Nigeria
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Background of the study
Economic downturns often lead consumers to become more discerning in their purchasing decisions, making pricing strategies a critical factor in shaping perceptions of product excellence. In Kaduna, Nigeria, the FMCG sector is particularly sensitive to economic fluctuations, where pricing not only reflects affordability but also signals quality. Companies strategically adjust pricing to balance profitability and consumer expectations, with lower prices sometimes implying lower quality, while premium pricing can suggest superior product attributes (Bello, 2023). During economic hardships, consumers tend to scrutinize pricing details and promotional offers more intensely, which in turn influences their overall perception of product excellence. Recent studies suggest that transparent pricing strategies can mitigate consumer concerns and maintain product credibility even in challenging economic climates (Ibrahim, 2024). Additionally, the competitive nature of the FMCG market in Kaduna requires firms to continuously innovate pricing approaches that resonate with value-conscious buyers. The interplay between price sensitivity and quality perception is complex and demands a thorough investigation to understand how pricing adjustments affect consumer behavior. This study explores the nuanced influence of pricing strategies during economic downturns, contributing to the broader discourse on market resilience and consumer psychology in volatile economic periods.
Statement of the problem:
In times of economic downturn, pricing strategies for FMCG products become a contentious issue, as consumers often equate cost with quality. In Kaduna, conflicting signals from pricing—where aggressive discounting may lower perceived value and premium pricing may seem unaffordable—pose significant challenges for marketers. This dilemma is further complicated by economic uncertainty, which intensifies consumer sensitivity to price fluctuations and diminishes trust in traditional pricing cues (Mustafa, 2023). The absence of clear guidelines on optimal pricing during economic hardships creates ambiguity in consumer perceptions, leading to decreased brand loyalty and market share erosion. Hence, it is imperative to systematically assess how varying pricing strategies influence consumer perceptions of product excellence, thereby providing strategic insights that can help firms maintain competitive advantage (Ibrahim, 2024).
Objectives of the Study
To evaluate the relationship between pricing strategies and consumer perception of product excellence.
To analyze the effect of economic downturns on consumer sensitivity to price adjustments.
To propose pricing strategies that optimize perceived value and market competitiveness.
Research questions
How do different pricing strategies affect consumer perceptions of quality in the FMCG sector?
What role does economic downturn play in altering consumer sensitivity towards pricing?
Which pricing models can effectively balance affordability and quality perception during economic challenges?
Significance of the Study
This study is significant as it provides critical insights into the strategic use of pricing in enhancing consumer perceptions of product excellence during economic downturns. Its findings offer practical recommendations for FMCG companies in Kaduna, guiding them to adopt pricing strategies that balance affordability with quality assurance. By addressing the interplay between economic conditions and consumer behavior, the study contributes to both marketing practice and academic literature. The research findings will assist firms in maintaining competitiveness and consumer trust even in challenging economic times (Bello, 2023).
Scope and Limitations of the Study
The study is limited to examining the influence of pricing strategies on consumer perception of product excellence for an FMCG product in Kaduna. It does not encompass other sectors or geographical regions, and it considers economic downturn effects only within the selected context.
Definitions of Terms
Pricing Strategies: Methods employed by companies to set prices based on market conditions and consumer behavior.
Product Excellence: The perceived high quality and superior performance of a product.
Economic Downturn: A period marked by reduced economic activity, affecting consumer spending and market dynamics.
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