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Highlights
The best price is the one that provides
you with the most
long-term
profits. When you
price intelligently,
you have a sustainable advantage over most of
your competitors. |
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Find the Golden Mean
The best price is always the one that provides
you with the most
long-term profits.
Price in terms of value rather than cost.
Cost-plus pricing is worst choice. When you start pricing more
intelligently, you will have a
real
advantage over most of
your competitors.
Don't price neither to high nor too low. If
you price your product / service too high, many prospective customer will
choose not to buy from you. If you price your product / service too low,
people may get suspicious of a
"too good to be true" offer and decide to avoid a risky purchase.
"You’ve found market price when
buyers
complain but still pay," advised Paul Graham. |
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Provide Alternative
Offers
Offer alternate products or services when you
show the price of a product or service. Choices allow the buyer to make
logical sense of the price.
Provide a lower and higher offer on each side
of your main offer.
Menu pricing is an effective approach.
Organize your offers on a menu with pricing lowest to highest, or vice
versa.
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Example of Price Negotiation
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Marketing To the
Subconscious
A higher price conveys a premium product
experience, causing a powerful
subconscious
emotional mix of self-esteem, recognition and joy in consumers...
More
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Internet-powered Revenue Models
Freemium is a pricing strategy by which a product or
service (typically a digital offering such as
software, media, games or web services) is provided
free of charge, but money (premium) is charged for
advanced features, functionality, or virtual goods...
More
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High-Performing Price Tags
Extensive price tests
show that .99 outperform the next even number.
The following price points lead to the
highest purchase rate:
19.99 ▪ 49.99 ▪
79.99 ▪ 129.99 ▪ 149.99 ▪ 179.99
▪ 199.99 |
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Free or No-fee?
You may wish to offer complimentary products,
services, and other benefits to your customer. Should you call them "free"
or "no-fee"? Call them "no-fee" wherever possible. Why? Free and no-fee
look, sound and feel different. "Free" suggests there may not be a great
deal of value. "No-fee" suggests that there is
customer value,
but you are giving it as a gift. |
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Raising Prices
There is no
victory at bargain basement prices," advised
Dwight D. Eisenhower. Don't be afraid to increase your prices or
fees If your price-point became unsustainable for a good reason. If
you create great,
innovative and
differentiated
value ‒ people will pay for that. Raise your prices moderately because any
large increase may be
perceived
as excessive. In case a moderate increase doesn't meet your sustainability
goals, think about splitting your product or service into different
elements. |
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