Remember the quote from the 90's? That famous phrase uttered by Andre Agassi on behalf of Canon. Image is everything, and that spells true for both companies and individuals. 

As individuals, the way we present ourselves has a profound impact on our lives. A study in Britain has shown that a person has 3 true friends, and as much as 18-30 other friends. So as individuals, we strive to make an impression on a relatively small bunch of people, yet we all know how crucial and lasting that impression is.

Business, I'm sorry to say, don't have friends. We have customers. We treat our customers well; we want them to come back, to spread the word and sometimes we go out of our way to please that loyal customer who's been shopping with us for as long as we can remember. A striving business will have many customers, often much more than the friends of all of its employees combined. So brand image can do for a business what personal image can do for an individual, and then some.

There are reasons why customers come to you for business. Courtesy, service, quality, convenience, price... We're all a little thrifty, so price is a key factor. But price is never seen on its own - we're paying for something, and that something is what we'll end up with after the money changes hands. But what if your customer's are new and don't really know what they're getting - how will it wear, how will it taste, smell, perform or last in the long term?

Marketing 101 will tell you: customers often judge products by their price. In three words: cheap is bad. This is why brand-names outsell no-fills in supermarkets, despite costing more for what are essentially the same ingredients. We don't want to overcharge our customers, nor do we want to sell products at or below cost price just because business isn't going well, or a big name competitor has just moved in next door. Don't confuse the concept of a sale designed to boost purchase rates and turnover aging stock with long-term sub-market pricing that will permanently change your position in the market and erode your bottom line. Look at brands like Hyuandai and Kia. Long term sub-market pricing has created an almost irreversible brand image as entry-level cars. Something that until recently you'd consider buying your 18-year-old for her birthday, but would keep the Honda for yourself. Ironically though, Hyuandai's a pretty good car, and is up there in the quality and consumer satisfaction charts. But it has taken them years and an enormous amount of money to rebuild their brand, hiring European designers, hitting quality targets and gradually increasing their prices hoping to eventually claw back the mid-market sector.

The Duchess of Marlborough from a 1960's German film Das Glas Wasser (A glass of water) has famously said: "I don't learn from my mistakes - I learn from other people's". And there is, indeed, a lesson to be learned. By discounting your products or services your are doing a long-term disservice to your business. The harm to your business's reputation may or may not be repairable, depending on what opinion your customers have formed of you over the years.

Set your prices to cover your costs, make profit and allow the business to grow. Don't be tempted to undercut your competition, because the biggest guy always wins. Look beyond sub-market pricing in order to capture new customers and increase customer retention. Remember, humans aren't cold, calculating robots - we have an emotional side and often act irrationally. A rewards program is an excellent way to capture new business and retain existing customers without the downside of appearing cheap. By discounting an item you're not rewarding the customer, because they haven't even bought it yet. A loyalty program, on the other hand, rewards customers after they have purchased a series of products or services, and each purchase brings them closer to their reward. The more they shop with you, the more incentive they get, and the more likely they are to choose you over your competition for their next purchase.

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