Shoppers are always out for bargains, and thanks to the Internet, finding them is easier than ever. With price comparison engines, customers can compare your products to those of competitors in seconds, making it essential for you to price them correctly. This does not necessarily mean setting the lowest price, but rather determining one that is appropriate given your product’s features. With the following pricing strategies, you can provide a good deal for your customers while obtaining the profits you deserve:
If you have a physical store with established prices, the easiest strategy is to price your online wares the same way. In addition to being quick, simple, and easy to verify, this method has the advantage of making your company look consistent. Customers who have visited both your store and the website will not feel cheated in either location, observing the same prices for each object.
For all the advantages of consistency, there are limitations to just copying prices. The marginal cost of selling an item online may be different than that of selling it in your store. If it is higher, you risk losing money on online purchases; if lower, a competitor could undercut you. This strategy also does not tell you want to do if you sell items online that are not available in your store. Simply copying prices may thus not be appropriate, requiring a different strategy.
An alternative strategy for selling online is to calculate the marginal cost of each online item and base the price on that. When determining this, make sure to consider not only the cost of buying or manufacturing your gear, but that of maintaining and updating your website, providing support to online shoppers, and all other associated expenses. You should also consider the value of your time; every extra minute you devote to your website should be reflected in the price of online items. Then factor in the amount of profit you must make for each sale to be worthwhile and post the prices.
Consumers aren’t the only ones who can compare prices online. If most of your competitors already offer online sales, you may want to base your prices off of what they charge. This does not mean copying those prices down to the cent. Rather, consider how your products differ from theirs and estimate the value of those differences. If your gear lasts longer than a competitor’s does, for example, you can afford to charge a little more. Conversely, if a competitor’s product is easier to use than yours is, you will have to charge less to make customers willing to buy it. Make sure to incorporate these decisions into your marketing campaigns, advertising your products based on their low prices, superior features, or other positive distinctions.
When choosing a pricing strategy, it is important to consider what your company means to your customers. If you provide standard uniforms and gear that clients could get from a dozen other sources, you will have to keep your prices as low as possible, accepting the slimmest margin of profit. Selling a unique type of uniform, however, or providing clients with web features or services they cannot get elsewhere will justify a higher price. In general, the more unique your company is, the greater your margins can be.
Pricing is not a one-time decision, but rather something you must review and rethink throughout the life of your company. For more information on pricing and other uniform and gear marketing topics, contact UniformMarket today.