Sales are fundamental to a company's success. Unfortunately, many companies do not consider the possibility of using pricing to accelerate their sales and win more customers.
Below are a few pricing ideas you can use to drive sales at your company.
Pricing Idea 1: Revise Your Price List With Value in Mind
Focus on the value you are offering, not just the price this could be:
- Quality of your products and services
- Technical capability of your staff
- Good reputation of your company
- The longevity of your product
- Special features of your product not available from your competitors
- Convenience of your location for after-sales support, delivery of spares etc.
The above may mean that you can increase your prices without losing customers.
Study the components of your value offer to customers and identify every instance where you might be giving something away for free. This might be a consultation, service, training, delivery etc.
Apply a value to those elements and then design a way that the customer still appears to get this value for free. One example:
"Delivery is normally £8.95, but as a special deal for you/the first 100 customers this month, delivery is free, giving you a saving of £8.95."
Pricing Idea 2: Be Creative For Increased Perception of Value
Identify all "bland", descriptions, e.g. "price is £750." Re-word this such that the perception of value is emphasised. For example,
"The price of this shed is £750" becomes "Your investment in this attractive garden storage is only £750."
Pricing Idea 3: Re-word Prices For Relativity
Identify all "nondescript" price tags.
If you have an item for, say, £99, have your marketing department re-word all price tags, banners, brochures and catalogues such that a perception of relativity is presented. Some examples might be:
- Deal of the week at £99
- Manager's special at £99
- Limited offer at only £99
- End of season price at £99
- For this month only at £99
- Was £199, now only £99
- Save £100 ..........
Pricing Idea 4: Offer Tiered Pricing
At its most basic, tiered pricing means providing your product or service at different price points. As a consumer, when you’re choosing between receiving an item in 5-7 days, 3-5 days, 2-days or overnight, that’s tiered pricing in action.
Giving multi-level pricing means you are giving more options to your customers which allows you to reach even more shoppers.
In most cases, shoppers tend to go for a middle option so make sure you are positioning your desired winning SKU in the middle because this is where most of your shoppers are likely to purchase.
The lower option will be important to attract the more price-sensitive consumers or, for a new product, a lower price point product allows shoppers to test it out.
Here are six things that tiered pricing can do for you:
- You will make more money. People will pay up to the limit they can afford. If a customer is willing to pay £100 and your product costs £10, why would you leave £90 on the table?
- It widens the reach of your customers if you offer, say, a £50, £100 and £150 version of your product, instead of just one £100 version.
- Lower priced options can be a gateway for new customers who may eventually graduate to higher priced products.
- It’s easier for you to create one product with multiple price points than many separate products.
- Instead of giving your customers a choice between you and a competitor, you’re allowing them to choose between you and you, ensuring they’re price shopping in your store only.
- By allowing customers to pick a product for themselves at the price they prefer you create a sense of maximised value.
Get The Price Right by Sahaj Kothari 2015
Pricing For Profit, Peter Hill 2013