Good morning, class!

Today, we’re going to talk about how marketers respond when competitors change their prices.

Let’s imagine you own a business that sells bubble tea in Malaysia. One day, your biggest competitor suddenly lowers their price by RM1. What should you do? You can’t just sit back. As a smart marketer, you need to think fast and respond with a strategy!

Here are four common ways marketers respond:

1. Maintain Price But Add Value
   You may choose to keep your price the same, but give more value. For example, you can offer free toppings or a loyalty card. This shows customers they are still getting more even without a price cut.

Example: Tealive keeps the price but offers "Buy 5, Get 1 Free."

2. Reduce Your Price
   To match or beat the competitor, you might lower your price too. But remember, this might reduce your profit. So you need to think whether it’s worth it.

Example: If Chatime lowers its price, Tealive might respond with a promotion at a lower price for a limited time.

3. Improve Product or Service
   Instead of changing the price, some businesses choose to upgrade their product or service to stand out.

Example: You may offer faster delivery or better packaging. McDonald's sometimes doesn’t lower prices but gives extra toys or exclusive meals.

4. Ignore the Price Change
   Sometimes, businesses decide not to respond. This happens when they believe their brand is strong, and loyal customers will stay with them.

Example: Apple doesn’t drop prices just because Samsung does. They focus on product quality and brand loyalty.

💡 Remember: Every price change in the market sends a message. A smart marketer must always analyze the competitor’s move, study customer reaction, and then decide the best response.

Your choice will affect sales, brand image, and customer loyalty.

Thank you!