Consider a new pizza restaurant that is opening near the school's campus

Answer: The customer reference prices are those prices which the customers use as a reference when they make a purchase decision. Generally these are the prices that the competitor products offer or a price that the company had previously advertised. Apart from this the fair value of a product as estimated by the customers may also be used as a reference price by them. For a new Pizza restaurant that is opening near a school campus may find it difficult to determine these reference prices. The first difficulty will be to estimate a common reference price for all the students as students based on their experience may have different idea of reference price. Hence there may be multiple reference prices that may exist. Similarly it will be difficult for the restaurant to collect prices from all the competition restaurants so that they may get an idea for the reference price. They may find such information through the following strategies

1. Conducting an interview or survey among-st the students of the school for getting an idea about their reference price
2. Conducting mystery shopping exercise at competitors for collecting prices of the competitors