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Pricing tips and pointers

How do you get your pricing right?

Pricing is a key component of your marketing mix and it's often the thing that small business owners worry about.  Here are some tips to help develop a robust business pricing strategy.

Remember - it is easier to reduce prices than it is to increase them...

..conversely, increasing prices if often a way to target a market more effectively. Your customers will have a feeling for what your product is worth, and how they value it. This feeling is known to economists as "Price Sensitivity" and it can be mapped so that you can predict the impact of  a price increase on the number of customers you will retain and how that will effect your profitability. By putting up prices you are likely to lose customers but you can also gain customers and increase profitability.

Unless you have very deep pockets and a competitive motive; or a definite advantage that lets you sell at a lower than market price, try to avoid a price war. 

Carry out research into pricing

When you consider competitors think laterally, as the most obvious competitors that you believe you have aren't the only ones you have. A competitor is any company competing for the same time or money from the same target market. Your customers have choices about how to spend their money so look left and right at different sources of competition. 

Quality vs Price

People mistrust things that are too cheap, and get a bad impression about products that are perceived as over-priced. You pricing strategy should reflect your overall offering, so if you are trying to deliver a high-end product to a sensitive market, make sure everything you do reflects quality at the appropriate level.

Have a top of the range product

Customers will aspire to buy the best but often it's out of their price range. By offering a premium product and a lesser product, you might find that your products are valued at a greater price than you think. If people buy your premium product and demand increases for it you might consider nudging all your prices up.

Also, having a premium product is a way of increasing demand for the lower range products. people want the best but settle for second best. Research into buying behaviour shows too that people enjoy a sort of "value glow" from owning a product that is associated with another at a higher price.

Don't just reduce costs if you want to increase sales

Generally speaking, think long term, not short term. There better ways to attract sales than just changing the price. Consider your entire pricing model - it's not about the price on the ticket. For example, you might offer a superior service, or bundle products into an added value offer; clothing companies do this all the time by offering accessories at reduced rates to match large, single items. You can also add value with future upgrades, or replacements, a loyalty scheme or a simple guarantee to make people value your product in a different way to the competition. 

Embrace your pricing

The more you work on pricing, the broader the range of tools you will have to compete. As you get more in tune with pricing you will become flexible, and be able to move faster to make confident, effective changes in the future. 

If you would like any help with your pricing do get in touch. We're always here to help.

5 daily tips for a refreshing week

Back to school – 5 things to do this week to get your business ready for the new term

We write newsletters and copy for all sorts of businesses. This week we gave a client some simple pointers for a "Back to School" feature they were sending to small business owners. They said we could share them. So, if you are a small business owner and you want to get back into the swing of things, try our one-a-day, five-a-week or just all-at-once tips for a productive week. 

Monday. Log in to Google Analytics and note down the page that gets most hits and the one that gets fewest. If you have any tumbleweed pages consider editing them or replacing them with something up to date. Make a plan to do this and have ideas about what content you need.

Tuesday. Update your database with the business cards you’ve been collecting and putting to one side because they are important… No database? Start one. Excel will do just fine.

Wednesday. Re-read your social media plan. Haven’t got one? Write down the answers to these questions: What do I want to do SM for? How often will I update my SM? What sort of things will I talk about? Then go and find 5 new people to follow or like and get inspired. Write down your ideas and make a plan to make a plan.

Thursday. The new Friday so be inspired for a few minutes. Think of a business you want yours to be like. Write down what that business does well and think about how you can be like it!

Friday. Give yourself half an hour to kick back and make a note of just how far you have come since you started your business. Give yourself a pat on the back, before welcoming the weekend.

Well done, you got through the first week back and your business is already in better shape!

Communication innovation training

Here we go with another action-packed and fun training session for North Devon+

It's on 21st July in Bideford. It's fully booked but you can contact North Devon+  @northdevonplus for details of future courses. We'll be looking at how small businesses can get really creative and clever with their communications. And of course, how the big companies with all their people and budget and rules and safeguards can just mess it up. We like this one.

Innovation marketing training in North Devon

Quick update. Innovation training time again with a new session next week on the 30th June at North Devon+ The session is fully booked but if you are interested in either getting on the waiting list for next time please get in touch with Kristy Webbe at North Devon+ 

If you fancy having us run an innovation session (or other marketing training) just for you, get in touch with us instead :) 

innovation training