Australian Business Coaching Club Newsletter - At What Price?

 

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At What Price? (This is an edited extract of the Blog Article)

When marketing a product or service, businesses find it difficult to set their prices. Too high, and no-one will buy, too low, everyone will buy, but you go broke. So how do you set your prices?

The basic principle of pricing is that you should set your prices as high as the market will allow. But what does that mean?

This means understanding the value you offer compared with your competitors.

Is your product stronger? Does it last longer? Is it better designed? Or is there a convenience factor? What is the value of such differences to the buyer?

For example, you can get a $2 chocolate snack bar at the service station as you are filling your car. You know you could probably get the exact same bar for 25% less at the supermarket, but you will have to make a special stop, and then you will have to wait in a queue. Its just not worth the 50 cents you will save. But if the bar was $5, would you buy it? Well you might if you knew that this service station was the only retail store for 200 miles!

When you know what your product is truly worth, and you have educated the buyer of its value, you will be able to set prices that reflect that value.

If you don't understand your value, you will forever be just another commodity seller competing on price.

(See the full version of this article on the Blog)

All you need to do now is to Empower yourself and take action ...

Have a great week!

Dr Greg Chapman - The Business Brain Surgeon
The Australian Business Coaching Club