Before you sell your products or market your services you must first identify the cost. Understanding the price will give you a better perspective of your potential revenue, competitors and target customers. Pricing your product is a defining mark for your company and should not be taken lightly. Follow this five-part series to understand the complexity, trickery, and science behind pricing.
Originally published on Control. March 12, 2015
Part One: Cost-plus Pricing or Value-based Pricing
There are two general principles to pricing your products and services. You can rather implement the cost-plus or the value-based pricing method. Whichever one you choose, it will not only define your product but your company as a whole.
So what’s the difference?
Part Two: 7 Free Tricks To Pricing Your Product
The Good, The Bad, And The Ugly
Shoppers are inherently programmed to compare prices. If you place a $20 T-shirt next to one that costs $50, it is instantly clear which one is more affordable. However, if the $20 one is made to be far less desirable and—for what you are getting—is still quite pricy. That’s because the intention is not to sell the $20 product, but to get people to opt for the more expensive deal for the reason that it’s actually worth it.
Part Three: Tiered Pricing Can Take Your Product To The Next Level
Tiered pricing gives people choices—and we all know that people love choices. When it comes to payment, choices may bring more value to your customers. Why not let them choose how much they want and how much to pay for it? After all, when you go to the coffee shop you want the freedom to pick Small, Medium, or Large. This ideology can work for your product or services too.
Part Four: 6 Ways To Conduct An Effective Discount Promotional Campaign
After the free samples and 14-days trial period, you may be pressed to earn more leads and gain more revenue. Without adjusting your standard price, you’ve decided that implementing a discount or promotional campaign is the best avenue to take. However, there are no fixed rules when applying discounts or generating coupons. You can hand out flyers on the street, but all that effort may be wasted time. Here are six tips to conducting a successful discount promotional campaign.
Odds are at one point or another you’ll want to increase the price of your product. Investors, competitors, your internal team, and even the public may be urging you to do so. You yourself know that the current price is under valuing your product and this path is no longer sustainable. There are many reasons why raising the price makes sense, but the question is not why you should hike prices, but how to do it effectively without losing customers and decreasing your conversion rate.
Elliot Chan 