TIA: pricing a new product in Argentina

There are 6 replies in this Thread. The last Post () by Rice.

  • I’m brainstorming a possible product subscription idea that a friend may pursue, aimed at Argentines... and we’re considering a subscription of 100 pesos a month. One Argie I asked if she would pay this said: “I wouldn’t pay 100 pesos a month for this because that feels expensive, but I would pay 4 dollars a month for this since that feels cheap.”


    Ummmm.....


    In bizarro Argentina logic, that makes sense.


    What I like about this story is how clearly it elucidates what goes on in the Argie’s mind as they come to their weird conclusions on things.


    (For future reference of people in 5 years who stumble upon this post: the peso is current 25 to the dollar.......)




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  • I can kind of see the logic, since the dollar-peso ratio has again changed so significantly very recently, compared to several stagnant years when it sat around 16 pesos to the dollar, and we all got used to that. She could still be partially in the 16 pesos/dollar mindset, so 100 pesos would represent 6+ dollars, or 50% more than your 4 dollar quote. Could this make sense?

  • Rice


    I think the explanation is very different. She has a veeeery clear sense of the exchange rate now - they were just visiting NY a week ago.


    The reason is this: argies treat dollars and pesos differently - even when the exchange rates are accounted for. When something is in pesos, they are, well, argies: being the cheapest people anywhere even knowing their cheapness comes with a requisite decline in value of what they’re buying. But when they go to the US and use dollars, they think more like Americans and use American standards. That’s why 100 pesos is expensive but 4 dollars is cheap.


    Morgan





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  • I have been having a hard time in fixing my own prices. I give some Italian classes and pricing is quite challenging to me.

    At first, I started with what a colleague Italian teacher told me to charge per month. But I was too shy to adjust prices in the second half of the year (which apparently everybody does). Besides, the exchange rate was pretty stable in 2016-7.


    This year we had a dropout from that group, and the rest of the members decided they would cover the difference (+$300/month each), also to adjust their monthly fee to inflation.


    I think I am priced about the same as everybody else, native speaker or not, with teaching credentials or not. In this sense, it is very hard to approach new clients because there is always a cheaper option available and people cannot simply see the point in paying more for my service. Quality is completely out of the picture.


    I have two Facebook pages to advertise my Italian classes and I get maybe one-two inquiries a month. One guy told me I was too expensive and that he had found another person charging 30% less. I am not working full time giving Italian classes, my main line of business is specialized translation for US and UK clients, which is far more lucrative than teaching Italian to Argentinian and earning in pesos.


    It is hard to explain to prospects that I believe my classes are not like at language school where they play, sing, and use a silly book. I like to describe my classes as an 'Italian boot camp'. Some people take Italian classes just to pass the time and stay with other people, they want to have mate and cake at 5 PM with their class, talk about their grandparents, etc. This is not my style.

    I do offer support all week/month, not just during class hours but nobody takes advantage of it. Some don't even do home works and so we do them in class.

    I send a recap email after every class with the new words/expressions and the topics covered -- this takes 30' to 60'. To prepare a 2-hour class takes another 45-60'.


    So if we add up numbers, 2 hours in class mean 4 hours of my time (preparation+class+recap email). I believe nobody else provide such service, but I thinking to the kind of service I would like to see from a private language teacher.


    I have now published prices on my Italian classes page, which are slightly above the average as I'd rather translate than teach. And there is plenty of Italian association, retirees associations, political associations, recreational associations offering Italian classes for about $1000 a month (4 times per month).

    Some 'Italian' teachers do not speak Italian well, even if they are graduated in Italian teaching (profesorado de italiano). So does some 'Italian' sworn translators graduated from the traductorado de italiano.


    Those who speak correctly are those who lived in Italy for some years, regardless of their education. But it is very hard to make people appreciate the value of premium service in Argentina.


    Besides, I took on a new group one week before the pesos lost its value, one month ago. I quoted a price (fixed for 6 months) and the next week the pesos dropped. I have now compromised all my Saturdays for €100 a month!!! I can do that money in one day translating.

    But since I am not Argentinian, I committed to it and I will carry it on. However, it was a lesson learned.


    Argentinian market requires a too flexible and batshit-crazy pricing model.

  • I agree with your confusion serafina . It's the perception of money here that seems to dictate the model.

    AR$500 still sounds like a lot of money, even now - but it isn't. I now have to charge a minimum $350 house call fee and even that isn't all that much really.

    For a complete Windows installation I charge $500 and they still complain, until I explain what's involved or ask them if they would prefer to do it themselves.

    At times I can be quite brusque and direct with my customers, especially if they think they can get something for nothing which is, let's face it, the Argentine way.

  • I agree with your confusion serafina . It's the perception of money here that seems to dictate the model.

    Totally. I have also tried to figure out how to sail this hard sea doing what everybody does: keeping the price fixed, but reduce the offer (AKA get those alfajores smaller, Juan!)

    I.e. if before I was charging X for a 2-hour lesson, now I still charge X, but the class is just 1.5-hour.


    Another thing that I discovered: if you have a per-hour fee and you let the student pick how long they want their class to be, they will start to fraction to 15'. Just for the sake of an example (these are not my rates), if you advertise classes for 100 ARS per hour and suggest a min of 90' per class, people get disappointed when they find out that 90' means 150 ARS.

    So they will try to negotiate a 75' class and a discount.


    Therefore, now I have adopted a different approach: I am telling them the class is 90' and costs $150.

    Guess what? I had a girl saying that once per week was not enough for her. Holy moly, just tell me you need an intensive course, we double or triple frequency and so the price. No, she said 'I was not looking for for once-per-week class'.


    By the way, have you considered giving computer classes to elder people? On https://www.tusclases.com.ar/ there are some on various topics. You have one free ad per category, but you cannot edit the location once you've published your ad.

  • Rats! I spent some time writing a response to this a few days ago, but must not have hit 'reply,' because it is gone.. Will post a shorter version:


    There could be a psychological factor in play here, signaling that 4 of anything is good value, while 100 of anything is overpriced, even if there is complete understanding that 100 pesos = $4. Irrational, to be sure, but there it is. Back in the day when the Italian lira was worth an infinitesimal fraction of the US dollar, I might have been very familiar with the exchange rate, but there were still times when a price tag of a thousand lire for a grocery item stopped me in my tracks.


    Anyway, morganf , I don't agree with you that the Argentine people are " the cheapest people anywhere." Considering the unceasing, exhaustingly high inflation that is this country's economic history, the people here have done a remarkable job of endlessly adjusting their lifestyles downward, as paychecks have continued to buy less, year after year. Still, they carry on with cheerfulness, generosity of spirit, and style. What might look like tight-fistedness in many, many cases is actually a question of choosing between necessities and extras.