Augustin is very experienced, which in this case might have been to his disadvantage. Augustin made the mistake of not making his decisions based on the users, rather he based them on his experience. This is a basic principle of design thinking: always start with your customers, understand their situation and their needs, user test to get meaningful feedback, and iterate the process to find the perfect fit. However, Augustin neglects to do most of this and does not make a user-centric decision. In design thinking terms, Augustin’s decision-making had no real validation in place. This is important because if you are not basing your decisions on what the users want, this is no different than a personal project where you don’t consider the market, but just product things that you find to be the most interesting. If you are investing a great number of resources (both time and money) into a business decision, you should be taking into consideration much of the market’s needs, namely the users’ needs. If Augustin had been more attentive to the users, then surely he would have found out that in many cases discounts were good and that the users were not as strict on the pricing strategy as he had initially posited.
Augustin should perform a thorough price study if I were to advise him — this would include conducting intensive interviews to ascertain both the positioning of Emilia’s brand and the willingness of people to pay. These tests will teach him the importance of discounts to the brand. Discounts are not in themselves a bad thing, as mentioned in the expert writings, but they should be used diligently. First, I would advise him to form a task force specifically aiming to conduct user research both qualitative and quantitative. Through this, they could test many different pricing strategies. Also, a price forecast will take these results into consideration to extrapolate the future revenue with regard to each pricing strategy. This would save Augustin and the company from many of the disasters that would continue to pile up.
