Have You Got Your Prices Right?

Your prices affect the demand for your products. So, getting your prices right can have a big impact on your profits, the growth of your business and its very survival.

You should consider Price as a key ‘P’ in the Marketing Mix so it is well worth focusing on.

But it is difficult to get your pricing strategy right.

Your prices should be a function of the customer value that your products and services deliver.

Your pricing needs to reflect your market position, relative to your competitors. It should usually be based on ‘market pricing’, take psychology into account, but should also make sense on a ‘cost-plus’ basis.

See more on our approach as Marketing Strategy Consultants for Small Business.

Do you know how to use pricing psychology?

“Almost every small business I have ever worked with doesn’t charge enough for their products and services. This is due in part to a lack of confidence, in part to a feeling of competition, and in part because they have never strategically educated their clients on the value of what they have to offer.” (John Jantsch, Duct Tape Marketing)

More than half of SMEs under price and try too hard to compete on price, which can have a serious impact on profitability. Don’t take this dangerous but tempting route unless your so new to your market that you have to ‘penetrate’ your market, or your business is called Lidl, Poundland or Ryan Air!

  • Businesses marketing superior products or services should be charging higher prices that reflect their value.
  • Your products can be both expensive and really good value.
  • Build a premium brand to help you charge higher prices.

“Price, as I suspect you’ve learned, is a terrible place to compete. There will always be someone willing to go out of business faster than you.” (John Jantsch, Duct Tape Marketing)

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