raising your prices Archives - Attention Getting

Today I am giving two proven marketing pricing strategies to try. A lot of people still do not understand how the law of supply and demand impacts their business, and how it can also affect your pricing strategies. So here are two proven pricing strategies to try based on when times are busy and times are slow.

When Demand is High

For example, if your business is crazy busy right now and you have more sales than you can handle, do not turn any business away (because these customers might never come back). Instead raise your prices, if only temporary, and especially if your supply or resources is limited.

Another good time to raise your prices is close to the last days of any major buying time for your business. For example, people who wait until the last minute to buy Christmas gifts or Mother’s Day gifts, will pay a premium for their procrastination, likely due to diminished supply.

Remember, people will spend more when supply is scarce and when the need is urgent. That is why toilet paper and hand sanitizer shot up in price during the initial stages of COVID-19. I am not saying to gouge people, that’s wrong, but a reasonable increase in price of 10 to 25%.

When Demand is Low

Now, what about when demand for your products is low? This happens when a product is nearing the end of its life cycle or the market is saturated with competitors. This is when you should have a sale, especially if your supply is high, and a significant sale to get rid of inventory so you are not stuck with it.

For example, winter fashions featuring a trend that might not be around next winter, are best to get rid of at deep discounts of 40 to 70% in February and March. Better to make some money then to get stuck with the inventory. Plus, these new customers might turn into return/repeat customers.

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why people buy When people come to your site and don’t buy, what is the first thing you assume is wrong? I bet you think it’s your price. Maybe. The truth is you have to think about what makes people buy, and price is not always a factor.

Reasons People Do Not Buy

They don’t need your product.
They don’t need your product right now.
They don’t see the value in your product.
They are unsure that you will deliver what you are promising.
Your price was too high compared to similar competitive offerings.

So if you really feel price is your problem, then here is a way to test it.

Don’t lower your price permanently but instead offer a one-day only special with a coupon code for 50% (or pick a percentage in which you will still earn a profit – don’t take a loss). Make sure customers know it is TODAY ONLY. If even at 50% off they are still not buying, then you know it’s not your price.

Do you know that too low a price can hurt you as well? If someone really loves or wants an item, and you have created that must-have feeling in the customer, price usually isn’t an object (unless it is obvious that you are completely overcharging). Sometimes too low a price makes the customer feel the product is cheap and of poor quality. So trying to undercut everyone will not always work in your favor either.

Do you know what makes people walk away from an online sale more than price? Shipping charges. Especially if you live in one country and you are buying from another. There have been cases where the shipping ends up equaling the price of the product. So sometimes it is better to offer FREE SHIPPING and buffer the cost into your product price. When a customer commits to your price and then gets to the checkout and sees it has doubled due to shipping, this is not the same exchange anymore and they WILL change their mind.

FINAL WORD: So, offer a fair price based on what it costs you to make your product and allowing for a profit, compare it to your competitors’ prices, test it with your market, and then make sure your customers understand the value that comes with this price. Related: Two Easy Pricing Strategies to Try.

IF YOU ARE NOT MAKING SALES, I can help! My 12-Month Marketing Plans will give you all the tactics you need to successfully promote your small business.