Do I have to price my product low to gain sales?
| Answer: You're essentially asking a fundamental question in marketing. The short answer is that it depends. First, it depends on whether or not your customers are price sensitive. If they deeply care about a low price then you need to price low. But it is important to note that while some customers care deeply about low price, this is certainly not true of the broad market. This is because customers make tradeoffs. Tradeoffs mean that they'll tradeoff one benefit (like a low price) for some other benefit that they care about as well (say, convenience). For this reason, customers are typically willing to pay more if they get something they really care about in return. This is confusing for many people since they see that people like a good "deal" or something that is given away. But don't confuse the fact that people like a good deal (just about everyone likes that) and the more fundamental idea that people are willing to make tradeoffs. |
More resources related to Pricing
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Pricing is more than cost plus margin or lowering your prices just a tad below competitors'. Think like a buyer to zero in on profitable pricing strategies tailor-made for you, with the added benefit of setting you apart from the competition.
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