Pricing Strategies-Don’t make the mistake that causes many budding Entrepreneurs to Fail.
There are things I wanted to discuss with you related to pricing.Â Before you head off to create a sales system and stuff a price on your product, I want to get your ear for a moment.
The aim of this article is to give some insight into the versatility you have as an online marketer with your own products. The problem is, most people just seem to whack a price on their products with little time spent thinking about it why they’ve priced it like that as well as what factors are going to contribute to whether it’s a successful decision. Sound complicated and a lot of work? Well, let me tell you it’s not.
But I think it’s really important that I show you just how much freedom to experiment you have with regards to pricing, and what effect getting it wrong can have.Â Before you put a price on your product and release it to the world, take some time out, have a read, pick up the points and take them into account using them as kind of a checklist.
The Bigger Picture
Now, understand, there’s a much bigger picture to this than most people realize.Â Often time, prices are put there just because–who is regulating to say otherwise? They are generally also fitted loosely around competition and other products and services offering things of a similar nature, however, it’s not just about planting a number and a dollar sign behind it. All through this process you should be asking yourself lots of why questions. Some of the time, people ask me why the heck I go so in depth into subjects and talk about why they happen. They just want to know how to make a whole load of cash real quick.
Well, I say to them- I can tell you how to do something, and the situation changes, and you didn’t know why it worked in the first place, then you’re going to have to come right back to me again, hand me another five hundred dollars just to find out how to do the same thing in a different way. However, if I tell you how things work, you can take some serious knowledge and know-how away with you.Â You then have the power to adapt to the fast paced changing world of business online or offline. If you can’t adapt, you’re dead. Or your business is anyway.
Like I say, there’s quite a lot to this, and a lot of things that we’re going to talk about, and there’s going to be a load of questions that are going to pop into your head. Does competition matter in such a big marketplace with regards to pricing? Should I be cheaper? Should I be more expensive? How do I know when to be which and why? Should I give special offers to particular groups of people? Who? Why? Should I offer different versions of my product at different prices? How do I do that, and how do I know if I’m doing right?
There’s a shed load of answers about the above and much more that I’m going to give you in a moment. But all the way through this I want you to keep in mind the flexibility you have as an online marketer with your pricing. Get this right, and it could easily mean double the profits for you. Get it wrong, and it’s likely you’ll have trouble selling anything at all.
Pricing with Regard to Competition
So, with the formalities and generalizations out of the way, lets look at how you should price your products with regard to competition. The reason I want to talk about this first, is simple. When you’re looking at pricing, the very first thing you’re likely to do is say, â€œhey, so what is everyone else charging for similar products?â€
Now there’s nothing wrong with doing this at all, but there’s more to think about, and a lot more questions to ask than a simple can I beat what this guy is charging for his service?
Your price doesn’t have to beat everyone elseâ€™s out there for you to get sales. Imagine you’ve just started up an ad tracking and autoresponder script site that’s so detailed, and so professional that it smacks the pants off the competition. But see that the other sites offering the same service are hanging around at the ten dollar per month mark. Does this mean that you have to go and beat them with a lower price just to get people to notice you? No, not at all. What you have on your hands is a premium product, and you shouldn’t be worried to sell it at a premium price.
Rule 1: Premium Products Sell at Premium Prices
Hereâ€™s rule number one.
If you have a great premium product, don’t be afraid to bump the price up. You do not by any means have to beat a competitorâ€™s price to be competitive, in fact, by increasing your price, it’s quite possible that you’ll outsell your cheaper competition. Why?
Because a higher price screams quality.
Don’t, for one moment, believe you have to have the best price to make any sales. That’s just not true, you just have to have the best sales system, and of course a premium product if you really ever want anyone to buy from you again.
Rule 2: Wowing Through Price Is a Bad Move
The fact is, if your price is too low, people look at you and wonder why the heck you’re charging that tiny amount. If your brand spanking new piece of advanced technology software is really as good as you say it is, why does it only cost ten dollars? So there we have rule number two. Never price yourself so low that you think people will look and think wow thatâ€™s a quality sounding product, look how little it costs! That’s not what they’re saying at all. They’re saying, â€œWow, look at how little that costs. There can’t be that much to it.â€
So in effect, all you’re doing here is adding even more value to your product through a higher price. It might be the same product, but I tell you now, it’s much more likely to sell more copies at a price that someone might look at and think that it’s reasonable, or average than something someone might look at and fall off their chair at how cheap you are.
Donâ€™t Be Afraid
Too many people are afraid to take the leap and price their products as they believe they’re worth. Too many people look at competition and think they have to cost less otherwise no one is going to buy their stuff, or they’ll make less money out of it. This is simply not true. Don’t undervalue yourself just for the sake of being cheaper. If you have a better product, you put a higher price tag on it. The experimentation and playing around to find the right combination of offers, deals, follow-up and pricing options can come later.
I could show you so many products that are out there right now, in competition with each other, but one is charging a heck of a lot more than the other. How about this guide, for one? Here’s us charging you a thousand dollars for the complete set of manuals, but there are plenty of other guides out there that cost ten dollars. Will the quality of both of them be the same? Looking at the price alone, from a customerâ€™s point of view, I highly doubt it.
Times Are Changing – Business Needs To Adapt
How about the latest purchase you made for your house, whether it was a whole work surface, a new garage door, a toaster, a dinner table, whatever it was. I bet if you think about it, you’ll see that times have changed. A long time ago, even before I was born, people wanted things that worked. They were just ok. But nowadays that’s not enough. It’s got to be the best, the fastest, the nicest, the easiest to use. There’s a real market for premium products emerging. Make sure you don’t place yours in the bargain bin if it’s meant as premium product.
O.K , this article has gotten a bit long.Â Expect more to come about product creation and pricing your product.Â Cheers everyone.
Remember if you want to get on the Profit Theme for 27 bucks, it only has 4 more days till it is over.Â Â Cheers!
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TERESITZ (TERRY) LEWIS says
I like this article. Can not wait for the next one.
A very good article, I like all the points you have mentioned here. Recently started a business, and I thought to myself that may be I need to lower my prices, I was not definite on it, but after reading your article I am sure that I should not do that, because I sure am putting a lot of effort to get all the things right. Thank you !