We find that managers rarely, if ever, think about consumption when they set prices-and that be a costly oversight.Д¬onsider this example. Ask that same executive how pricing policies affect consumption-the extent to which customers use products or services that theyвЂ™ve paid for-and youвЂ™ll get a muted response at best.

This promotes preventive care, reducing HMOsвЂ™ costs.ДЄsk any executive how pricing policies influence the demand for a product or service, and youвЂ™ll get a confident, well-reasoned reply. By itemizing individual servicesвЂ™ costs within a bundled fee, HMOs may prompt patients to consume paid-for benefits. Psychologically link payments to benefits.By staggering membership payments to spread use of their facilities over the year, health clubs could prevent overcrowding-increasing customer satisfaction. Stagger payments to smooth consumption.She could better manage costs by staffing according to expected actual, rather than paid, demand-or boost revenues by overselling events for which she expects many no-shows. A theater manager can expect more no-shows if the proportion of season ticket holders is high. To augment demand-centered pricing with consumption-focused tactics: With little sunk-cost pressure, people donвЂ™t use the tickets-reducing their likelihood of buying next season. Season tickets вЂњhideвЂќ each ticketвЂ™s cost, unintentionally encouraging customers to view their tickets as free. Price bundling masks an individual productвЂ™s cost, reducing the likelihood of its consumption.At one theater, the no-show rate for credit-card customers was 10 times that for cash customers.

When people pay with credit cards, theyвЂ™re less likely to remember the cost-or consume the product.

CustomersвЂ™ perceptions of price determine their likelihood of consuming paid-for products.

For example, two weeks after paying $300 to join a tennis club, a man develops painful tennis elbow-but keeps playing. Why? The sunk-cost effect: People abhor wasting non-recoverable investments.

People tend to consume products if theyвЂ™re aware of their price.

Most magazinesвЂ™ renewal rates are 60% or less. This is especially important for businesses selling subscriptions or memberships-where long-term profitability hinges on retention, because acquiring customers is so expensive. Customers canвЂ™t repurchase or praise products they never consume. Consumption matters to any business relying on customer satisfaction to generate positive word-of-mouth and repeat sales.

Customers who use paid-for products tend to buy them again.

Demand-centered pricing has merit-but executives who use it exclusively risk trading long-term customer retention for short-term sales. And members who frequently work out tend to renew.Д«ut to stimulate initial demand, most companies mask their prices, through advance purchases, seasonal memberships, annual subscriptions, etc. Every month, sheвЂ™s reminded of the cost-so she works out more, to get her moneyвЂ™s worth. WhoвЂ™s more likely to renew their membership? Mary. Bill pays $600 on enrolling Mary selects the $50-per-month plan. And the more they use it, the more likely theyвЂ™ll buy it again.ДЇor example, suppose that Mary and Bill join a health club. However, in the modern era, the vast majority of meat consumed by humans is beef or veal from cows poultry from chickens, turkeys, ducks, and other fowl pork from pigs and mutton and lamb from sheep.Why should you care if your customers actually use your products? IsnвЂ™t it enough that they buy them? Not if you want repeat business.Д¬onsider this counterintuitive impact of price on customer loyalty: When your customers are aware of your productвЂ™s cost, theyвЂ™ll likely use the product-to feel theyвЂ™ve gotten their moneyвЂ™s worth. Anthropologists believe that the increased consumption of meat, with its high fat and protein content, contributed to lengthening human life spans and intellectual development in prehistoric eras.Дozens of animals are eaten as meat in various regions of the world, including horse ( France, Italy, Germany, and Japan, among others) dogs ( China, South Korea, Vietnam, and Arctic regions) cats (China, Peru) guinea pigs (Andes mountain regions) and whales and dolphins (Japan, Alaska, Siberia, Canada, the Faroe Islands, Greenland, Iceland, and Saint Vincent). Meat has been part of the human diet since prehistoric times, and the domestication of animals for milk and meat was a driving factor in the rise of fixed human settlements from approximately 10,000 B.C. Meat is animal flesh eaten as food by humans.