Rethinking Price Wars: Disruptive Forces Are Reshaping How They Start, Get Fought, and Get Resolved

Roughly half of all companies around the world think they are involved in a price war. In almost 90 percent of those cases, they think someone else started it. At the same time, losing lots of money no longer necessarily means you have lost a price war. It can mean that you have won and won big.

If you feel that the maths doesn’t add up, you are right. You have also identified a symptom of a much larger problem: most of the maths and the prevailing wisdom around price wars no longer add up.

In other words: it is time to rethink price wars

Rethinking price wars in the 21st century starts with several disruptive forces which were much less pronounced or did not exist at all a couple of decades ago, thanks to digitalisation. Think rapidly falling marginal costs, higher price transparency, and unprecedented access to customers. Think interconnectedness in terms of global trade and supply chain integration. Think shorter product life cycles,…