4 Basic Yet Effective Ecommerce Pricing Strategies to Up Your Sales
For most, the price of a certain product can make or break the decision of a potential buyer to make the purchase. While it’s not even always the primary concern, it still is one of the most basic prerequisites for getting a product sold.
For your ecommerce store to generate maximum revenue, a proper pricing strategy must be applied. This strategy must take into consideration the many factors involved in arriving at the right price for your products.
Let customers know why your product is better than the competition.
First, determine where you want to position your store in the competitor market you are in. Decide whether your Unique Selling Proposition (USP) is price or value-related, know what you want to capitalize on, and find out where you stand alongside your competitors.
Research well about your competitors’ prices. Then, based on your identified USP, you may then proceed in making the decision of whether you want to raise, lower, or match the prices of your competitors.
Keep in mind also that it is important to let your customers know what your USP is. Also, it’s okay if your product isn’t actually as good as the competition. Besides, if customers always just want the best, everybody would be buying Rolexes and Ferraris. You may acknowledge that your product is simpler or less glamorous, and use the price to balance things out and demonstrate how choosing your product would give them more value for their money.
Give your customers options.
One of the most popular pricing strategies used by businesses even outside the ecommerce industry involves offering a range of products in such a way that a certain hierarchy is presented. Take for instance the way chefs offer different versions of a meal, and how there is always a good, better, and best version of said meal. When you offer your customers with choices that allow them to compare value, chances are they would choose the "best” version of the product.
Make a "bundle” out of commonly bought items.
By creating a package deal out of your bestsellers, you are putting in so much value into a single purchase. For customers who usually buy more than one product at a time, a bundle is one of the best deals you can possibly give them.
Use words that make certain fees seem insignificant.
If some of your value added services, such as gift-wrapping or annual subscription, are offered for a certain fee, phrase it in a way that would make customers feel that the fee isn’t something they should sweat about. For instance, in a study conducted by the Carnegie Mellon University, trial rates for a DVD subscription saw an increase of 20% by simply changing the messaging from "a $5 fee” to "a small $5 fee.
There are only some of the many pricing strategies you could use for your store. It is also important to note, though, that while there are so many success stories for every strategy, many variables can actually have an effect on pricing. Fundamental elements like supply and demand, as well as internal business elements such as authority, reputation, and ability to inspire brand loyalty are all huge factors that determine the success of your pricing strategy.