Pricing Strategies That Actually Work

Pricing your product or service right is one of the most challenging and important aspects of your business because it determines whether or not you succeed. Set the price too high and lose out on getting more sales. Set it too low and risk bankruptcy or business failure.

Therefore, learn, master, and apply effective pricing strategies to increase revenue to keep your business operating.

I will help you to identify and implement the best tactics that will help you set the right price, charge what you are worth, and succeed. Whether you have been in business for years or you are just starting your business journey.

Conduct Market Research

To come up with an effective pricing strategy you need to conduct market research. Know and understand market demand. For instance, is your product or service something that people are interested in? Is there market demand for it? Find out how many people are willing to exchange money for your product and then take a look at the competition. Is there too much or too little competition?

Analyze your competitors. Concentrate on how they market their businesses. Identify what sets them apart. Is it their business model? Is it their marketing techniques? Perhaps it’s their pricing strategy? Knowing your competition will ensure you remain competent and be one step ahead.

Once you discover how similar products or services are priced, you can then come up with an effective strategy. You can either set a lower price or stick to the ideal one and include an offer that the competition isn’t offering for free. For example, if you are offering graphic design services and you get a client that wants a company logo, offer to design 10 business cards for free. Or 50 business cards at a 50 percent discount. This will attract all sorts of interest, bring in more prospects, and help you form long-term relations.

Next, define your audience. Decide whether or not you want to target a specific audience. Depending on your services, you can either choose your market based on geographic location, profession, etc. You can also cater to a bigger audience if you like. For instance, if you are offering accounting services you can target small businesses, freelancers, and entrepreneurs. If you are selling household furniture you can advertise to every homeowner despite their location, profession, and so on.

Identify customer needs and provide solutions. Attract a bigger audience by creating a product that will help them meet their needs. Include this in your marketing strategy. Mention how your offer will make their lives easier and give them a reason to choose your product over your competitor’s.

While it is important to give customers first preference and present your offer in such a way that will keep them interested in doing business with you, you have to consider profits. Set goals and specify how much money you want to make from the start. This enables you to not only cover production costs but ensures you stay in business. So, consider how much you want to make from the beginning. Keep that in mind when setting your price, deciding on your unique value proposition, and coming up with an attractive offer to make the competition irrelevant.

Consider other important factors as well. Such as marketing expenses and production costs where applicable. Come up with a strategy that allows you to cover all expenses and avoid using your personal accounts to keep your business running. Make sure your business makes enough money to cover daily or monthly costs to continue operating.

This doesn’t necessarily mean you have to set the price too high. Doing so can force prospects to the competition and lead to little or no sales. So, use different pricing methods. Try different approaches to see what works best for your service or product offer. Your pricing strategy will vary depending on the product being offered. This means what works for a certain product may not work for another.  So, mix up your pricing methods for the best results.