Bath Bomb Pricing vs. Value

As I was working on a previous blog (Lush's "Naked" Campaign), I started to think about how Lush is able to charge a higher price for their products due to the higher value that they offer their customers. The company is strongly against animal testing and refuses to even purchase ingredients from companies that use it. They use 100% vegetarian and organic ingredients in their products. They utilize ethical buying and boast naked packaging. Naked packaging means that products either have no packaging at all or the packaging is made from recyclable, compostable, or reusable materials. All these company attributes provide additional value to customers who care about the environment and animals. They are willing to spend more money on a "premium" Lush product rather than buy a less expensive product from a brand that uses animal testing, low grade ingredients, and has no concern for the environment. I wanted to make a comparison of one of Lush's products to other brands and see the difference in price and value offered. I decided to go with bath bombs.

Here are the prices I found by looking around on the web:

• Lush= $4.50 to $10.95
• Tubby Todd Bath Co= $25 for 3 (not sold separately)- $8.33 per bomb
• Bubbly Belle= $19.95 
• Fragrant Jewels= $14.95- $19.95

I was very surprised to see that Lush actually had some of the least expensive bath bombs. However, after some research I determined that the other companies had managed to create value in different ways than Lush. 

Companies like Bubbly Belle and Fragrant Jewels have come up with a genius strategy. In addition to getting a bath bomb, customers also receive "a beautiful ring and secret code" that comes in a plastic ball inside the bath bomb. Once you put the bath bomb in the water the hidden prize pops out. This adds value to the customer by giving them an additional item (ring) and adds excitement to the experience. The customer wonders "what ring will I get?" Additionally the secret code gives the customer a chance to win a second ring with a retail value of between $100 and $10,000. The possibility of this more expensive ring adds even more additional value to the customer's original purchase. Fragrant Jewels also boasts benefits such as the product being made in the US, being cruelty free, phthalate free, gluten free, and paraben free. For many customers, this probably makes the product equal to Lush in health and eco-friendliness (even if this is not actually true). Bubbly Belle did not share this same type of information. Instead they used promotion and sales incentives to get customers interested. The 1st bath bomb is only $1. If a second bomb is added to the same transaction, that one costs $13.95 as opposed to the usual $19.95. Finally, the site offers the option to double your cart for only $7.95. They are using price to add value (in addition to the ring) rather than using the quality of the product to add value like Fragrant Jewels. 

Another website that I found interesting was Tubby Todd Bath Co. This site only sells bath bombs as a bundle for $25. This is a smart strategy because it forces the customer to buy more than 1 bath bomb and therefore spend more money. At Lush, the customer would have to be convinced to buy 3 separate bath bombs for the company to earn the same revenue per customer. This company has also been very smart about their marketing strategy. They are selling to parents of young children and that is reflected clearly in their messaging. The marketing provides additional value to the customer by showing them exactly how the product can improve their lives and the lives of their children, which is huge priority for these customers (check out the description). Tubby Todd Bath Co. bath bombs are made in the US, use natural organic ingredients and natural/ plant based fragrances, are gluten free, animal- cruelty free, dairy free, toxins, parables, sulfates, and bpa freel, and are safe for sensitive skin of all ages. 

As it turns out, natural and quality ingredients in bath bombs are pretty common across the market. This is why Lush is actually lower on the price scale for what they can charge customers. They do not provide additional value because other competitors have the same benefits. The competitors that are able to charge higher prices have added extra value to the customer through price incentives or "ring prizes". This was not what I expected at all, but it was very interesting to learn about.

What do you guys think about this? Do you think the "surprise ring" warrants this increase in price? why or why not? Do you think there is anything Lush can do to improve the value they provide to the customer, which would allow them to raise their price? Do you even think they should raise their price?