Low price strategy is Low price is when a company has reduced the manufacturing, operation, logistics or implementation of a product or service to the maximum, in such a way that it achieves a lower price than the standard in a market or with the cost of its competitors.

Building a business based on being the cheapest option is not always the most innovative strategy. In this scenario, it would be enough for a competitor to produce its product one dollar cheaper (or less), and your advantage would instantly disappear.

If that happens, you will be involuntary to cut all the expenses that prevent you from having the lowest price to regain your competitive advantage. As a result, you should probably say goodbye to good service, quality and innovation.

Advantages And Disadvantages Of Low Prices

Low Price

You may attract more sales, but you must consider all the factors that influence determining a price; you could lose quality, immediacy, attention or other attributes.


Produce More Sales

By reducing the price of your product or service, more people will be attracted to buy to take advantage of the opportunity, so the number of sales will skyrocket.

If the price is not a factor for your customers buying your product or service, lowering it could negatively affect sales. That is why we advise you to carry out a study on what type of consumer buys your product and the reasons behind their choice for your business.

Reach Other Audiences

A low pricing strategy is a great way to drive customers away from your competitors and get them to buy from you. This strategy is aimed at the more sensitive public to the economy; you can allow them to have what they need at a lower price than what your competition offers. So they will not hesitate to choose you.


It can affect the brand: the image that your brand has for the client is very important, so if you lower prices without explanation. It could reflect low prestige, which can turn away some customers. Therefore, reducing costs without properly analyzing your objectives and your company’s current situation could affect the perception of your brand.

It Affects The Perception Of Quality

Low prices are often synonymous with lower quality, so companies that offer the same product could have more excellent sales opportunities if your product is low quality. However, an effective common price strategy should not be related to reducing the rate but rather to your sales objectives. The possibility of reducing costs without affecting the value and essence of your products or services.

It Can Lead To A Loss Of New Customers

Lowering prices is not a strategy that you can apply permanently. Today you reduce costs and attract new customers, but later, you will have to raise them. And in the process, you will probably lose those customers. That is why the recovery of the original price must be carried out gradually and in a justified manner. Otherwise, your efforts will be in vain.


t is a business tactic whose objective is to obtain a niche, launch a product. Or reach a specific audience through offering low costs in its products or services (especially in particular periods).