How do some brand names manage to stay afloat—as market leaders—when their competition cuts prices? How do they avoid getting caught up in the endless back-and-forth of price tag combat? They remain steadfast. They refuse to engage in a price war. And then they do a few more things to seal their fates as market leaders.

Read on to learn the secrets of thriving in the midst of a price-point battle.

How Brand Names Survive, and Thrive on, Price Wars

It’s hard enough to preserve your brand in a saturated market, keeping it afloat in spite of rising costs, going above and beyond customers’ expectations, earning enough to live the life you love…and then your competition drops its prices.

A price war has been waged.

Surely, your customers will flock to the competition…

and there they go.

What should you do? Mourn the loss of those customers and then continue on as usual? Drop your prices too? The answer is neither of the above. Instead, let’s talk about how the biggest and best brand names have made the best of (and profited from) a waged, but not engaged, price war:

  • First and foremost, DO NOT CUT YOUR PRICES. And just for a moment, forget about what price-slashing would do to your bottom line; think about what it will do to the customers who have been loyal to your brand. Your time will be consumed with people who flock to your brand looking for the ‘best deal,’ rather than quality service. You will find yourself overwhelmed with low-quality relationships, which will detract from your loyal clients…and then guess where they’re going? Far away from your brand. Price-cutting may seem like the answer in the short-term, but in the long-term, you will end up right back where you started—with less profit.
  • Look at the bright side. The customers who choose to run to the competition are not the types of the customers you need to build your brand; so, in a sense, that price-cut will help to raise the average quality of your clientele. Those who are loyal proponents of your brand will not run for the sake of saving a few pounds.
  • Focus on your loyal clients. As soon as you get word of the price cut, get in touch with your most loyal clients. Offer them something (e.g. a subscription, free gift, coupon, registration in an online seminar, event admission, etc.) that will increase the value of their interactions with your brand. Keep them happy…or happier.
  • Ask for referrals. Many brands hesitate to do this, but take it from the big brand names—rather than waiting for people to volunteer to give testimonials and refer new customers, ask them to do it. If they are loyal to your brand, they will be happy to do so. And what’s more, you’ll be working toward replacing those low-quality price chasers with high-quality clients (because, remember, your brand should also be targeting potential clients who share social circles with your existing, loyal clients).
  • Know what to say when confronted. There will likely be a percentage of your client base that approaches you, asking you to match the [new] lower prices of your competition. We recommend that you respectfully decline, citing the fact that you do not believe that anyone can deliver quality at that price. This will get their wheels turning—and the ones who stop to think twice about going over to the other side might be worth keeping.
  • Finally and probably most unexpectedly, CONSIDER RAISING YOUR PRICES. Remember that all things are relative to current reality, and since your clientele have now been exposed to a price-cut, as well as your refusal to engage in a price war, they will be more attuned to the relationship between quality and price. An even larger price gap between your brand and the competition will allude to a greater gap in quality. Something to think about, eh?


There are a lot of things to consider when a price war is at hand. We always recommend that you look to the most successful brand names. What would they do? How would they respond? How have they forged their success in the market?

And, of course, we always encourage you to contact How to Build a Brand with your burning questions about how the best brand names do it, and how that should translate to your brand. Better yet, register for our Online Masterclass to KickStart your brand’s success, get your daily branding tips from more than 400 videos on our YouTube channel, and Like our Facebook page for more valuable information for brand names and budding brands alike.

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