By Mazen Al-Angary
Over the years What’s Up met many entrepreneurs who started their very own business, and one of the areas they had to cover was setting a price tag on their products or services.
There are many ways to price a product or a service, depending on your policies and strategies which works in various situations. So if you are at a point where you’re considering starting your own business, here are some tips that would help you determine how to price your goods.
High or Low?
It depends on the uniqueness of your product/ service, and competition. If your product is defined as a luxury, then the price should be high.
If you’re unique, and charge a high price, this will attract new competitors into the market stealing your thunder and taking away your advantage. So think ahead.
Gaining Grounds
If you’re trying to penetrate the market and gain some market shares, you should consider offering an artificial low price to gain grounds, after securing your position, you can increase your prices. To reach the desired price point you had in mind all along. This way you will start to gain market shares.
Which Side are You On?
Depending on which segment of the market you are attracting, you might want to set low prices to be affordable for the lower segment of the market, that doesn’t mean you will sell less, that actually means you might sell more. But most importantly, you need to understand your segment.
Go Psycho!
You can see this tactic used a lot these days, and almost everywhere. “Look it’s only SR 9999!” this strategy tends to play on our emotional responses towards numbers, so if you have a product you want to price between SR 40 and SR 50, you can slap a SR 49 and it will sell like hot cakes.
Add an Upsize
You can also add a little more to get more, for example you would sell a product for SR10, you can also tell your customer that they can get an extra bundle package for SR19 which you should design as a bargain to attract their interest. So do you want an Upsize with that meal?
Act Now and Get A…
You can attract customers with creative options, instead of giving them a chance to ask about a discount, then juggle the options between telling him or her that you have fixed prices, which might repel them from buying. Tell client that they can get 10% discount if they pay the full amount in advance.
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