Cheaper – Definition, what it is and concept

Cheating is to reduce, or lower the price of something in particular.

This term serves to indicate that some product, or service has been lowered in order to increase its sales in most cases.

That prices are lowered has a lot to do with human behavior. If products are purchased from a certain company that begins to raise their prices, the most likely will be to go to the competition, or brands with similar items that have a lower price, and that offer the same solutions.

Lowering prices has a lot to do with the demand and supply of services and products, with circumstances, competition in the market, geographical areas or with certain social moments such as a crisis.

In all these cases there can always be a price variation that responds to the needs and specific aspects of that moment.

Why can prices decrease?

These are some of the reasons that can lead to this happening:

  • When a new brand emerges in the market, and is aware of the price of its competitors, it may be that it uses strategies such as lower prices, sales, the acquisition of three products at the price of two, among others. All this with the aim of attacking the market based on prices so that people move to that brand, and begin to be recognized. The problem of working on the basis of prices, and not a value strategy, is that it will be more complicated to upload them, in addition to selling more for the company to have profitability, and that can also affect the production phase since it will take a greater number of articles, and more hours of work to produce them.
  • The social crises that have occurred throughout history have also been responsible for lower prices. For example, the world crisis during the period from 2008 to 2014, affected Spain in one of its most prosperous sectors, the real estate market. During that time the price of housing fell sharply, to which was added that there was a great shortage of real estate loans. Home sales declined, construction companies declared themselves in bankruptcy, and that was when they started selling real estate at reduced prices.
  • The shortage of demand leads to lower prices of a product. When some products do not register a good rotation and market introduction, and purchases are not as expected, it is necessary to reconsider a price drop to try to recover and not compromise the investment made to manufacture these items.
  • Low season. This is one of the reasons why product prices are cheaper. For example, the time of sales in January. Consumers have bought a large number of items for parties that at this time to output the products lower prices to avoid stopping the purchase of these. In addition, with the passage to other stations such as spring to summer, textile items of that season are also reduced in price to be able to sell them and start with the new stock according to that time of year.