How to Achieve “Winning Price”
Setting a price for your merchandise or services, especially when you are trying to sell on the Net, can be the most crucial business decision. Determining a price is not as easy as it might sound. If you are looking to make profit your price should be more than your cost but it has to be lower than the ‘price the market can bear’, i.e. the price your customers expect to pay for your service. You have to keep these things in mind when pricing your merchandises.
There are elaborate pricing plans that you should understand and be able to work with. What pricing plan you want to work with would depend on your business pattern.
Like the ‘Pricing to Penetrate’ plan. This plan would work for you if your aim is to penetrate the target market, quickly. To accomplish this objective you will have to price your merchandise low.
But it’s important to decide how low you can go without reaching the bottom. You need to figure out the lowest you can go without leading into debts and great losses. You should not have mental reservations about receiving initial losses if you will get long term clients in return.
But how do you determine the lifetime value of any customer?
Lock in your regular clients and make sure you take steps to make them stick to your particular brand. Penetration pricing is useful if you are going to make a long lasting impression. It can also be useful in conditions where a lot of new players are starting into the market.
Your merchandise should be the ultimate ‘sticky product’ which the customer can let go of. On-line agents for example, are so much more favorable that once hooked people don’t even think about alternatives.
Another way to ensure that the customer returns is to manufacture an great product. When selling books On-line for example, a great book with a good price would ensure your fast popularity.
Amazon.com for example is the major player among On-line book shops because of their heavily subsidised values. Even though this business tactic might have costed them many a thousand bucks but they have managed to make a solid customer base which they can now trust upon.
Another viable example in real life is how companies that manufacture razors hit upon the idea that it would be much more profitable to resell razor blades than handles, and the rest as they say is history.
Related posts:
- Price Skimming As a Pricing Strategy
Of all the marketing strategies you will use in your business, the pricing strategy is one of the most important. Along with choosing the right product, intelligent marketing, and a sound sales plan the correct price strategy will determine your revenues and market share. Usually the leaders in their industry... - Working With Price Sensitive Buyers
The value of money in today’s world is a stark reality and that is why customers looking to shop for their needs have become aware of the cash factor where buying is concerned. They look to getting the most out of the least money spent that is why pricing your... - Write Winning Headlines While You Sleep?
Want to get an extra 6-8 hours of productivity every day? Then try this little trick… Every night before you go to sleep, ask for an idea. For instance, if you are writing an advertisement, say to yourself… I really need an idea for this headline. And then forget about... - Winning The Bet: I Have Your Name Tattooed On My…
In college, my roommate Rick used to win bar bets by walking up to strangers at the bar and saying, “Hey, I bet you fifty bucks that I have your name tattooed on my (backside).” The strangers would almost always take the bet, part because it seemed like an easy... - Price Setting: My Clients Will Leave If I Raise My Prices. Really?
Has price setting been a prime concern for you recently? If you hesitate to raise your prices because you are afraid your clients will leave, take the issue to inquiry using The Work of Byron Katie. Here is how it can work: “My clients will leave if I raise my... - A Winning Diet As the Best Body Detox Tip for a Healthier You
Natural body detox removes toxic products from the different parts of the body. You might want to consider doing it, especially if you are feeling a lot of symptoms associated with declining health. In any way, if you want to cleanse your body from all the toxins that might be... - Working to Achieve Financial Independence
Many of us may speak about financial independence but the question is how many of us actually achieve it? Very few percentages of us actually know how to make a sound plan and even less are able to be discipline to execute the plan. Carefully consider the money management program... - Nice Has Its Price!
At the 2007 Grammy awards The Dixie Chicks song “I’m Not Ready to Make Nice” won the Grammy for best song. The storm of controversy that spawned the song is known to many. The hottest selling female country band in music history, the Dixie Chicks, got knocked off a lot... - Achieve Your Goals With This Mind Trick
Zig Ziglar had a quote which read: “An optimist is someone who goes after Moby Dick in a rowboat and takes the tartar source with him.” And I wanted to take a moment to expand on that quote today, because metaphorically “Moby Dick” is the big dreams we are chasing.... - Online Marketing: Can You Achieve SEO with a WordPress Site?
Experts in online marketing consulting emphasize a primary goal: getting your site indexed and ranked with the search engines. Not long ago, they would have said a blog might help you do that. They likely wouldn’t have recommended that a blog serve as your main site. Thanks to advances in... - Website Traffic Generation: Winning the Love of the Traffic Fairy
For a number of years, many online marketers honestly thought that the only thing they needed to do to be successful online was to “build a website, and the buyers would come to them.” They had heard all of the success stories from people, who claimed that they had simply... - Financial Freedom Comes With a Price
For anybody who is planning to, or going about, starting a home-based-business, there are some basic provisos and warnings that come as fine print, and regarding which nothing much is ever said by the prospective recruiters. But it is imperative that you give due heed to these basic truths. Firstly,... - Market Penetration Pricing
A quick-entry price strategy that presumes that sales volume rise when an object is priced low which in turn reduces the overall costs is called market penetration pricing. This is a useful strategy that can be used in price sensitive markets. For example, consider the market for DVD players; this... - Is Psychological Pricing an Effective Strategy?
Price has a psychological significance attached to it. Buyers have this belief that if a product is highly priced then it is more valuable. Although this belief is more psychological than reality based it makes price tangibles more effective than the product itself. However, it is interesting that as the... - Pricing: All You Need to Know
If you are trying to sell something on the Internet, pricing your services/ products would be the single most important decision you will take. Since, the Internet provides thousands of alternatives to the customers, you need to be at par with the competition. The prices that you quite will determine...