Customers' assessments of quality and value, buying decisions, and recommendations are all influenced by emotions. But too often companies don't adequately anticipate those emotions and therefore can't mitigate negative ones. This is especially true for "high-emotion services"--those that trigger strong feelings before the service even begins. Services relating to major life events, such as birth, marriage, illness, and death, fall into this category, as do airline travel, car repair, and home buying, selling, and renovation. They may elicit intense feelings for the following reasons: lack of familiarity with the service, lack of control over its performance, major consequences if things go wrong, complexity that makes the service a black box, and a long duration. The authors have identified four guidelines that can help managers influence expectations and perceptions of quality and value, enhancing customers' satisfaction and loyalty: (1) Identify emotional triggers; (2) Respond early to intense emotions; (3) Enhance customers' control; and (4) Hire the right people. They use some leading providers of cancer care to illustrate the application of these guidelines.

Price wars are a fact of life, whether we're talking about the fast-paced world of knowledge products, the marketing of Internet appliances, or the staid, traditional sales of aluminum castings. If you're a manager and you're not in battle currently, you probably will be soon, so it's never too early to prepare. The authors describe the causes and characteristics of price wars and explain how companies can fight them, flee them--or even start them. The authors say the best defense in a pricing battle isn't to simply match price cut for price cut; they emphasize other options for protecting market share. For instance, companies can compete on quality instead of price; they can alert customers to the risks and negative consequences of choosing a low-priced option. Companies can reveal their strategic intentions and capabilities; just the threat of a major price action might hold rivals' pricing moves in check. And, finally, companies can seek support from interested third parties--governments, customers, and vendors, for instance--to help avert a price war. If a company chooses to compete on price, the authors suggest using complex pricing actions, cutting prices in certain channels, or introducing new products or flanking brands--each of which lets companies selectively target only those segments of the market that are under competitive threat. A simple tit-for-tat price move should be the last resort--and managers should act swiftly and decisively so competitors will know that any revenue gains will be short-lived.