So if you want to target to the Basic Market, you should use your pricing policy positively to support your low price brand image. However, if one uses pricing policy incorrectly, pricing has a negative impact on branding. In Information Economics theory, pricing is a signal of the quality. This signaling effect of pricing enhances its importance in market segmentation. If you target to the Basic Market, you have to low your price and use your low price policy to position your brand and enhance the brand image.
Customers love high quality and low price.
They know your low price. But you need to show them your high quality. Pricing as a tool for branding is a fact instead of a choice. We don't have the luxury to choose between whether or not we want to use pricing as a tool to enhance our brand images. We only have the choice of whether we use pricing positively to enhance our brand images or use it passively to detriment our brand images.