Ten Ways To Price Your Products To Gain More Sales

1.What are you willing to pay?

You are an expert at buying things in person, online, from a friend, or from some kid selling random stuff with a big smile. Use that expertise, you can tell when you are getting a good deal on a purchase or are getting robbed. You also have knowledge of your product more than the average consumer. Without thinking of all of the work you put into this product how much would an expert spender like you pay? Twenty dollars is becoming a lot less shocking every time you buy a new shirt or hoodie. 

2. What would your mom pay?

We all know motherly figures that support dreams from selling lemonade to playing in the NFL. There are consumers on the market that hear a story about a local entrepreneur and want to help them out. They buy an overpriced item because they want to help the entrepreneur out. The market isn’t very full of these people but if you can find them, keep in mind that they will pay more. People pay more for people’s products that they admire. Think of every youtuber or social media personality, does their sweatshirt really cost to make 60-80 bucks? Heck no, but you might buy it to see your money going to someone you like more then Bezos. 

3. What would your brother pay?

We’ve all got siblings that know how to get the most from us and seem to benefit in every deal. Someone who doesn’t care so much about the entrepreneur but saving that extra dollar by screwing us over. They are a great tool for doing market research as well. While our mommas might pay more these are going to be the people that won’t buy in unless they think they are getting a deal. We need to keep these people in mind when pricing an item as well. They will always try to get a cheaper product but sometimes offering a product at a high price and then giving them a good deal will still make you money while making them feel like a winner.  

4.Thank you for your business goodbye, thank you for your business and see ya tomorrow.

We don’t know you or your business but it most likely falls into two categories. You either sell a product or a service and your business is either a one and done or you deal with a customer many times. This all plays into pricing your product or service, with a one and done business you have to raise your prices to cover for the lack of return customers for that transaction. 

One and done exchanges occur far more often in life whether it’s a bad date or buying a new television. Pricing is very subjective in these businesses as it depends on the customer’s budget as well as your profit margin. If you sell a product that will last a lifetime then selling at an expensive price point is the key to your success. If you choose to sell a product that has a planned or expected breaking point making the product cheaper will help the customer swallow the pill of buying a new product ever third year. 

If your business focuses more on multiple interactions with your customers than there are many approaches to pricing your goods and services. You can choose a flat rate that will be constant each year increasing as interest increases to provide a nice comforting constant experience for customers. Other approaches are the more a customer returns to you the cheaper the service gets which is like bulk purchasing. The opposite of that is starting off at a very low profit margin and increasing your price as the customer continues to know your standards and as you continue to out preform expectations. Depending on the type of business you have some of these approaches may work much better than others. 

5.Bulk Pricing

How can you make bulk pricing work for you? If you can make a product or make your service cheaper than offering it multiple times at a discounted price can help you reach customers that are watching their budget. You can’t please everyone, if you can keep a sufficiently high profit margin while offering a great deal on bulk products than this is a great method to pricing your products. 

If you can offer a deal on your product such as a buy five and get one free, then keep in mind you want to factor in the price of that one free item into the overall cost. Bulk pricing is a great way of advertising a discount while ensuring you maintain a profit margin. This is only advisable if you can get a discount on manufacturing in bulk.

6. Competitive Pricing

What are your competitors selling their product for? A key to success in business is being aware of your competitions prices and estimating their sales. A prime example of this is gas stations, ever see a gas station right across the street selling for a penny or two cheaper? 

That barely lower price can potentially bring far more customers to your business leading to massive profit gains. You and your company can also do the opposite if you know your customer base can afford a more expensive product and your product is better than it is easily explained the price difference is quality. Everyone’s bought a cheap product that only lasted for a few months, and they ended up buying the more expensive better product shortly afterwards. You might lose some customers originally but when they come back, they will be even more loyal to your higher quality brand. 

7. Sneakerheads vs My personal workout plan

Did that snippet sound or look like any YouTube video click bait titles? Well, both have a cult following that advertises for the company for free. Does your company or products traditionally have a cult following or group of people that obsess over your style of product? If so, make sure to target this form of advertising as much as possible. 

People want to be part of something more. This could be anything from following a certain body builder and buying their personalized diet to sneakerheads camping out front of shoe stores for the newest drop of shoes. We are all guilty to an extent for purchasing out of a desire to belong than out of necessity. Can you make your brand have a following or incredibly loyal customer base? Changing the price can help you to target your business own following and better serve them. 

Knowing your customer base and being able to target certain customers will enable you to pinpoint your price range to increase sales while maintaining your customer base. The more you can know about the customer base the better you can make your business work for them. 

8.Your social media coordinator sucks

Probably not but there are so many jobs that business owners feel the need to make an official position. If your pricing is selling to a large customer base but not making much money you may have too much overhead or put in plain terms to many people or things wasting your time and money. Do you have any employees that force you to micromanage them while they fail to complete even the simplest tasks? Fire them, a key to running a successful business is knowing when to fire employees. Remember to fire fast and hire slow this will help cut profit losses while keeping the business healthy. 

When your business begins to have more and more employees, you may feel tempted to higher a manager. If you must fill the role of managing the manager than they are not worth your time. Are you paying someone to do pay roll or wasting hours of your precious time doing pay roll? There are many businesses that you can outsource that work too and often at a far cheaper rate than hiring someone in house.

9.Why not raise the price?

Raising the price maybe a way to help ensure that your business continues to grow and stay healthy. Raising the price may annoy older customers but many consumers understand and expect the price to fluctuate as inflation increases or decreases. You can also raise the price of service-based companies for incoming clients. While guaranteeing sales is always a priority of any entrepreneur increasing your pricing will help you get more feedback from the market. This can be done with product-based businesses as well by changing the price on the store or online marketing page. 

If you can make more money by selling less products to fewer people but at a higher price than go for it. We don’t need everyone walking around to own our product if it’s going to cost us profit. Sometimes you must ignore a small group of cheapskates if it brings down the average price too much. Likewise, if your prices get too high and you start losing sales and your profit declines then we may need to lower the price again.

Experiment with your pricing will help your business in the long run as you gain more experience at market research. There will always be another customer and often there are more customers willing to pay more than the price you are charging if you can locate them. 

10. Loyalty? Why does that effect pricing?

If your business followed the plan in suggestion nine of raising the price for new customers, you can continue to ensure that old customers get the same great service at the same low rate. This can be done by emailing or making discount codes available to previous customers, this will help them become more loyal to your brand or company to continue getting deals. Ensuring that loyal customers is a key part of growing a business, but it should not affect your pricing for new customers. Often new business owners worry about experimenting with price because of old customers but there are many ways to keep loyal customers happy. 

The longer the relationship develops with the customer the more they are going to be connected and bought into your business. Your business can always reward customer loyalty and should even if it means occasionally reducing profit. One example is if a loyal customer has a bad experience with your business cut your losses and repair that relationship through a refund or additional product. This can be a great way to continuously grow a relationship with customers.

Example:

Cost of goods sold——-$3.25

Production time———-$2.00

Packaging——————-$1.78

Promotional materials—-$0.75

Shipping————————$4.50

Affiliate commissions——--$2.00

Total per-product cost——$14.28

In this example, your total per-product cost is $14.28.