The word “affordable” means that something is available at a price that someone can afford. If you’re shopping for a new bicycle, for example, you may be able to find one that fits your budget, is within your price range and offers the kind of style that you want. Similarly, you could probably buy a used bike at an affordable price if it’s in good condition.
The cost of housing is becoming unaffordable for many families in the United States. Multiple factors are contributing to this, including high labor costs for construction and materials, limited space for creating new housing and restrictions on where land can be used for building homes. However, the primary reason is that house prices are too high compared to incomes. Home prices are now roughly three times median household incomes in coastal California, and even higher in other areas of the country.
A similar trend is happening with consumer goods, as some brands have been raising their prices and lowering the quantity they offer in order to increase profit margins. This practice is often referred to as discounting. For consumers who can’t afford to pay the original retail price, discounts and coupons can make it possible for them to purchase products.
To ensure that products are affordable to their target market, businesses should understand what their customers are looking for and then create a pricing strategy that communicates value to them. This can be done by comparing the product to other products on the market, stressing its affordability compared to other similar products or making it clear that they are offering a great deal for an unbeatable price.
Often, businesses can meet the need for affordable prices by using their own resources to reduce production and manufacturing costs. Alternatively, they can make arrangements with Low- and Middle-Income (LMIC) manufacturers to produce their products at a lower price, while still maintaining quality standards. This approach also enables companies to fulfill additional equitable access objectives by helping to transfer technology and knowledge to LMIC manufacturers.
In addition, business leaders can use the linguistic norms of conversational cooperativeness to help communicate the reasonableness of their company’s prices. These are the four rules:
Be honest. Don’t compare your products to what people would consider an irritating or unnecessary expense. For instance, if your audience is a group of small business owners, you should not compare the price of your excellent, high-value product to the price of things like bottled water and printer toner. These are irritating costs that don’t add the value your product does.