Why it is NOT a good idea to buy Swiss Chocolate in Germany – International Price Management between Price Parity and Customer Value

Mark Friesen

The strong Swiss frank has made shopping for all kind of products in Switzerland a quite expensive enterprise. Compared to retail prices in neighbouring countries like Germany Swiss prices always tend to be higher due higher purchasing power and willingness to pay of Swiss consumers. However, a recent study of QUINTA Consulting shows that retail prices for milk chocolate are surprisingly higher in Germany than in Switzerland. Despite the unfavorable exchange rate the study indicates that four of six chocolate brands are more expensive in Germany. To make international price management a success the study suggests three pricing principles: 1. use of price discrimination and versioning for exclusive Swiss retail products to create additional customer value, 2. application of psychological means of price promotion and transparency to help customers to perceive Swiss retail prices differently, and 3. to communicate retail price changes to the Swiss consumer as fairly and early as possible.

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