Your Pricing Strategy – let’s talk about it!
This blog post is actually straight out of a lesson from my ‘Amplify You Intensive’, however, I really want to share it here with you because I think a lot of people are not understanding pricing for what it is – a significant part of your marketing strategy and the positioning of your brand.
Now I am not talking about whether to end you pricing with a ‘9’ or a ‘7’ here I am talking about really thinking strategically about your whole business when deciding on your pricing.
Here are some key considerations for you when determining your pricing (and this includes products or services):
- Pricing decisions are very important and they are a marketing strategy that should factor in your overall strategy
- Traditionally, if you are pursuing a cost leadership strategy your prices would be the lowest in your market, or if you are pursuing a differentiation strategy your prices would be at a premium to allow you to afford the product innovation and differentiation
- Or, how about this one, what if you offer the best product at the best value prices – THIS IS WHERE I SUGGEST YOU START TO AIM FOR!
- Some external factors to consider are – the price elasticity of the product (how much will your ideal clients tolerate when it comes to the pricing of your offer – is it likely to be a little or a lot of sensitivity that will have a significant affect on demand?), as well as the competitive situation
- Internal factors to consider are – break even analysis – whatever you decide it has to be sustainable!
- One small factor to consider, if gaining market share is a priority then lower prices could be a short term strategy even if this is not your long-term strategy for your business (be careful with this one though), think launch pricing only!
A note on pricing on your website:
I am amazed at how often I look through people’s services and don’t find pricing. Can I just say that often this makes me leave the site and find someone whose prices are listed to do the work. I understand and believe that many premium priced services require an actual conversation before the investment is revealed and all the reasons why this is the right thing to do. I do this myself and would advise clients to do the same for their premium services.
But this strategy doesn’t apply to all pricing levels.
If you are offering services that are in the lower range or even mid range pricing in your industry, and you are looking for volume to generate profit as part of your business strategy, then I would suggest you put your prices on to your website now – please!
For two main reasons. Firstly, you risk losing so many clients because of the potential to detract from your customer’s experience with your brand – it is time consuming and frustrating for them to come up against “fill in this form” or “book in a time to chat” just to see if they can afford to work with you or even if they already know they want to work with you and are just looking for the “buy now” button.
Secondly, if you put yourself in the position of needing to have a conversation with every potential customer to get him or her to buy from you, you are creating so much unnecessary work for yourself. Think about that in terms of the cost to your business. In this case you are not producing high quality leads in your sales funnel you are mostly just capturing people because they want to know how much you cost.
We go to the effort and expense of creating these amazing long form sales pages with fantastic copy and intricate formulas to entice our customers to buy, only to then tell them when they get to the end of all the reading they have to have a conversation with us to find out the price.
Is it worth your time or your potential clients time to do this? Ask yourself, do I really need to spend 30 minutes selling someone this service or is it a price that, after being fully informed by your sales page, they could / should just hit the buy button and the sale is closed?
Only you know the answer to this for your business and the industry you are in, I can’t give you amounts and limits to this but it is worth your time to analyse this for yourself and your own business.
Just don’t put yourself in a position where you are leaving money on the table by leaving your prices off your website.