Price is key in your client/customers perception of your product.
When you are trying to decide how much your product is worth, how your client/customer perceives your product goes a long way towards whether they make the decision to invest.
Under price and your prospective clients/ customers may think that your product is inferior in some way to it’s competitors. Overprice and you could appear to be too expensive with no extras to warrant the cost.
Many may equate low prices with a poor and inferior item or service. A little research into your market may gain you insight into what your clients/customers are willing to pay or expect to pay for a similar product.
Your customers will regard your product as valuable if it solves a problem for them. Rarity and scarcity of a product and 100% no quibble guarantee can improve your sales and let you price your product at a higher level.
If your pricing is too low you will find yourself working for very little revenue with no time or money to use to improve and develop your business. Get your pricing too high and you could lose out to your competitors when your prospective customers/clients deem that your product does not contain enough value for them to invest in.
Consider the value to your customers/clients and what impact the cost will have on their business.
Check out what your competition is providing in their package and what the market expects to gain from the product. Is there a way that you can fill a gap in the market and supply a product that no one else is providing?
Your pricing structure should be consistent with your position in the market. If supplying to the budget end of the market then low pricing will be essential where as if you customer is ‘high end’ then a low price will send out the wrong message with customers/clients perceptions tainted, thinking your product/service is inferior.
Research your market to determine the impact of your pricing and ascertain what percentage of customers will buy your product at a varying range of prices. Your costings should include a profitability factor so take account of fixed costs such as rent and salaries,the cost of your product to manufacture, making sure that these costs are well covered so you are not working for very little recompense.
What do you hope to achieve from your pricing structure, it’s impact on the market and your position within it?
When you have decided on your objectives the following may help with your pricing.
However you choose to price your product or service, take time to always measure the impact on your consumers of all of your marketing, using analytics to check what’s working best. With analytics installed on your website you are able to find out what your customers want and how you need to change to fulfil that need.
Member since: 8th May 2012
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