| Just_Ben said: I guess you did not read the book the theory comes from. ;)
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Why would I quote a very specific passage from Blue Ocean Strategy if I wasn't reading Blue Ocean Strategy? Granted, I haven't yet finished the chapter on pricing, so it's entirely possible that there's further details on when a price drop makes sense, but so far the tone of chapter 6 is "get the right price from the start and stick with it as long as you can".
Edit: Just finished chapter 6. Not a word on price drops besides that brief mention earlier. The rest of the chapter is dedicated to basic strategies for finding the right price point and getting a cost structure which optimises profits, as well as properly selling the idea of your product to your employees, your investors, and your intended customers. I also snapped a quick photo (beware 56k users, it's over 1MB): book and squirrel.
Another Edit: Just finished the entire book. The last chapter was highly elucidating and reinforces what I said: only when the market reaches the point where direct competitors of the same values enter your market space do you need to worry about evasive maneuvers like price cuts to remain profitable. Until competitors exist in your market space, however, your product maintains an almost monopolistic reign due to the assymetrical values your product has versus its competition.
Sky Render - Sanity is for the weak.
