Choosing The Perfect Price For Your Product
Posted on 6th January 2022 at 10:52
While you know how much your product is worth, your prospective customers don’t. Pricing your product or service well is vital to achieving the sales your business ought to have.
Aim too low and customers might assume your product is low quality. If you aim too high, you could alienate your target audience. Some business owners pick a price without giving it much thought. While the process doesn’t have to be complicated, it should be strategized.
Read on to learn how to find the right price for your product.
Looking at how your competitors are pricing their products is often the first step a business owner will take.
It makes perfect sense to do this, however your pricing shouldn’t just be a knee-jerk reaction to your competitors’ pricing strategies.
Your price doesn’t have to be the lowest price out there. In fact, sometimes having your price too low can put customers off, as they will assume the price matches the quality. Chances are, there will always be someone who can price their product lower than you. If you’re aiming to have the lowest prices out there, you’ll be fighting a losing battle.
Use your competitors’ pricing to get the gist of what customers are willing to pay, but don’t assume that those prices are a challenge waiting to be accepted. Find the highest and lowest price on the market currently. As long as your price fits roughly within this range, you’ll know you are on the right track.
A lot of customers will be suspicious of a price that’s too low. They’ll assume that you must have cut corners. Never price a product so low that people assume it must be too good to be true.
It’s also a good idea to avoid using the word cheap – this has connotations of poor quality. Instead, draw attention to what great value your product is for the price. Words such ‘bargain’ or ‘budget’ are less likely to put your customers off.
As long as your product is good quality, you don’t have to be afraid of charging for that quality.
It may seem backwards but charging a premium price can actually boost your sales – as long as your product reflects that price!
Ask yourself: what do I genuinely think this product is worth? The chances are that your confidence in your product will rub off on your customers.
Never determine someone’s budget for them. Don’t assume that someone won’t pay a premium price, but likewise don’t assume that everyone will be able to afford it either.
Giving people a couple of options allows for flexibility. If people feel your highest price point is too expensive, being able to offer them an affordable alternative might prevent you from missing out on that sale.
Be wary, however, of offering free trial systems. These can often attract people seeking freebies who weren’t ever serious about purchasing.
If you secure a sale with a customer, reward them! This increases their loyalty and makes it more likely that they will buy from you again.
It’s far harder to repeatedly find new customers than it is to convince existing ones to purchase again. After all, previous customers already trust your services – they are already halfway though the door, so to speak.
Rewards could include exclusive sales and discount codes, free gifts with purchase or a loyalty scheme.
Your price doesn’t have to be set in stone – feel free to experiment. Most people will understand that business prices fluctuate, but if you want to experiment with pricing without frustrating existing customers, promotions are ideal.
Promotions can also be a useful way of determining where your prospective customers are coming from. Having a discount code that’s visible only on certain social platforms can allow you to monitor the customers that are coming your way via social media.
Deciding on your pricing strategy can be a learning curve, especially if you’re a new business owner. Don’t forget that pricing can be flexible, and it’s better to change something that isn’t working than to stick with it indefinitely.
As long as you stay flexible and don’t attempt to be the cheapest out there, you’ll be on the road to success!
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