{"id":442,"date":"2024-01-28T20:54:24","date_gmt":"2024-01-28T20:54:24","guid":{"rendered":"https:\/\/gymguyz.wpenginepowered.com\/franchise-opportunities\/?p=442"},"modified":"2024-01-28T20:54:24","modified_gmt":"2024-01-28T20:54:24","slug":"tips-for-determining-your-best-pricing-strategy","status":"publish","type":"post","link":"https:\/\/www.gymguyz.com\/franchise-opportunities\/news\/tips-for-determining-your-best-pricing-strategy\/","title":{"rendered":"TIPS FOR DETERMINING YOUR BEST PRICING STRATEGY"},"content":{"rendered":"\n

Q: WHAT IS YOUR BEST ADVICE FOR A FOUNDER WHO IS TRYING TO DETERMINE HOW MUCH CUSTOMERS ARE WILLING TO PAY FOR A PRODUCT OR SERVICE?<\/strong><\/h3>\n\n\n\n

A:<\/strong> Understand the indirect competition. \u201cHow you should price a product varies dramatically between B2B and B2C offerings, but what most founders overlook is the indirect competition vying for their customer\u2019s dollars. Customers don\u2019t compare products and services in a vacuum; they compare offerings not only in your vertical but outside of it. Find out the common indirect competition and understand how you compare.\u201d Nick Reese, BroadbandNow<\/p>\n\n\n\n

Break out tiers. \u201cTiered pricing is a simple way to find out which features are most valuable, as well as which price points are going to drive the highest conversion rates. While many first-time customers will gravitate to the \u2018cheapest\u2019 package, offering upsell packages to existing customers through segmented market automation can allow for testing different price points without having to publish prices publicly.\u201d Dan Golden, Be Found Online<\/p>\n\n\n\n

Use bottom-up pricing. \u201cI\u2019d rather get customers paying at a lower price but paying than have too high a price point and zero customers coming in the door. Start by asking a few customers a fair price. Once they sign up, keep raising the price for new users until you notice that the percentage of people singing up is decreasing. That\u2019s when you know you\u2019ve hit your right pricing structure.\u201d John Rampton, Due eCash<\/p>\n\n\n\n

Ask for the sale. \u201cYou\u2019ll never know how much someone will pay until money changes hands. Many founders make the mistake of asking people how much they would pay for something. Theoretical spending answers do not reflect reality! Instead presell your product or service by actually asking for the sale. You\u2019ll quickly find out how much people are really willing to pay.\u201d Laura Roeder, MeetEdgar.com<\/p>\n\n\n\n

Don\u2019t underprice products. \u201cIf you sell a product (as opposed to an automated online service), price it as high as you can get away with so you still have enough people willing to buy it. You can always come down on price later as your efficiencies improve. Look at your competition, and don\u2019t try to undercut when starting out. Just make a better product.\u201d Wei-Shin Lai, M.D., AcousticSheep LLC<\/p>\n\n\n\n

Connect yourself to the right people. \u201cIdentify your ideal customer, and do what it takes to get them in the door. If you connect yourself to the right kind of customers, success breeds success, and you can begin increasing pricing as your experience and customer base grows.\u201d Lindsay Mullen, Prosper Strategies<\/p>\n\n\n\n

Find the right anchor. \u201cRead \u2018Priceless\u2019 by William Poundstone, and get familiar with the concept of price anchoring. In short, people really don\u2019t have any clue as to what something \u2018should cost.\u2019 They often decide based on clues (or anchors) that are immediately available on the spot when making the purchase (like the price of the product sitting on the shelve next to yours). Take advantage of this and anchor right.\u201d Juha Liikala, Stripped Bare Media<\/p>\n\n\n\n

Focus geographically and demographically. \u201cYou have to search geographically and demographically to see who you are targeting. It really comes down to finding the sweet spot of not too high and not too low, so it takes the right amount of research to figure out just exactly where your product or service will be worth their money, convenient enough and worth it.\u201d Josh York, GYMGUYZ<\/p>\n\n\n\n

(Source: TCA)<\/p>\n\n\n\n

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