First, make sure your brand is making a real connection with your customer. That means delivering an important benefit. For the E. & J. Gallo Winery, consistent quality is a big part of the brand's benefit. But what's driving sales is value. With a price range of $8 - $15/bottle, Gallo will continue to expand market share in an industry where consumers are rapidly trading down from $20+ wines. OK, but what if you have a premium product? Our advice: First establish, then keep your frontline pricing intact, but promote strategically, and possibly, more deeply.

Price promotion is the fastest way to get consumers into your brand and increase sales/market share. Here's an example for a premium-priced product. Bear Naked All Natural Granola's frontline pricing is generally $4.99 - $5.79 for a 12 oz. bag. The naked truth is this brand isn't cheap. It's primarily sold in natural/organic venues like Whole Foods, where high-end product sales are now leveling off, and in many cases, declining. Recently, Bear Naked began to implement more aggressive price promotion. Our market surveys show feature pricing as low as $3.49 - $3.99, a price range that's moving product.

Price promotion has costs. First, there's the risk that discounting too deeply or too often will damage your brand image. Second, there is the tangible financial cost, which can be significant. On the plus side, promoted brands will experience tremendous sales "lift" when sold on deal...at the expense of competitors. But it's the post promotion lift that's the real benefit. By promoting, you're not only maintaining your brand loyal consumers, you are generating new trial. This means new consumers and future revenue streams. There are other benefits. By increasing volume, you most likely will reduce cost-of-goods, improve gross margins, and keep your staff employed. Our advice: Carefully plan, budget, and test as you go along.