7 Pricing Strategies to Move the Needle on Sales

By Viqi French

Price. It’s likely the most important component of any entrepreneurial or small business marketing effort. When times are good, setting prices that resonate with targeted consumers is tricky. So in recessionary times, testing for optimal pricing, price reductions, and new pricing strategies becomes a marketing matter requiring urgent attention.

If you feel you’ve reduced your prices beyond what seems reasonable and still sales are slow, you probably wonder what on Earth to do next? 

According to this free report by Accenture, a weak economy means it’s time to outperform our rivals, not simply drop your prices to the floor. The way to do this is by honing your strategic focus. Look at your business and answer these questions:

• Where in my service/product portfolio do I offer a differentiated advantage?

• Which of my services/products will continue to be essential to customers past the economic downturn?

• Which services/products will most easily lead to sales of other goods or services?

To manage the recession, focus on these products and the opportunities they provide. Also, do whatever you must to minimize costs associated with emphasizing this product or service group. And then, says Accenture, price strategically around these products or services.

I like how the niche marketing coaches express this way of operating your business. They advise marketers to focus an inch wide and a mile deep. 

From there, consider a new pricing strategy – perhaps one of these:

1. Prestige in Pricing: Are you price positioned at the Starbucks end of your category or the new McCafe model? The Lamborghini or the Chevy? Higher prices, of course, imply higher quality. The world’s most coveted luxury brands are fine paradigms of the prestige pricing strategy. And speaking of brands and elements that comprise yours, sometimes just altering the appearance, packaging, method of delivery or statement of promise can justify charging – and getting – a higher price. Work differently to find and cultivate the Lamborghini wanters among your market. Once you get them, treat them royally and incentivize them to become repeat customers.

2. The Numbers Game: Do you know that most people tend to associate the number 9 with value and a zero with quality? Consider the difference in pricing styles between upscale restaurants and fast food joints. A meal at a high-end establishment may set you back a nice, round $30. But grabbing a burger on-the-run may only cost you $3.99 – a penny less than a big, round number that might push your budget over the edge. So, do the prices of your products or services convey Quality or Value? Interestingly, there’s lots of talk these days about prices ending in lucky number 7, too. It’s all called Psychological Pricing, a strategy to use when you want customers to respond on an emotional, rather than a rational, basis. 

3. Recurring Payments Encourage Satisfaction. Customers who pay more frequently for a product or service tend to use it more often. Therefore, they perceive they’re more satisfied with the purchase. A perfect example of this pricing model is the gym or country club membership. If you only paid one time for membership, at some point, you’re likely to view it almost as “free” and not use the facility very often. However, if you’re charged for the membership on a monthly basis, you’ll be more likely to keep using what you keep paying for, and value the frequent benefits you derive.

4. Promotional Pricing: Are you “Lovin’ It” when McDonald’s runs a 2 for $2 special? Well, so is McDonald’s. That’s because when they suggest how many Egg McMuffins you want, you’re often likely to agree. This type of pricing to promote a product or service is quite common and comes in many other flavors, too. For example, the good old Buy One Get One Free (aka pronounced “BOGO”).

5. Bundle Pricing: There’s also the class of promotional offers where products seem to multiply like bunnies. It’s called bundling, and it conveys super value. This is the “But wait: There’s more!” pricing strategy. For the price of one product or service, you’re going to actually receive two, three or even 10 related add-ons. We see this a lot among TV informercials. Online, we’ve seen an explosion of this technique among ebook marketers. Product bundle pricing also is a popular way to move old stock.

6. Incremental Payments are a Smart Plan: This pricing structure offers a customer multiple, bite-sized payments to eventually reach the unit total. TV shopping channel QVC is masterful at this, offering customers a plan to make four easy payments of, say, $19.99 each. This certainly seems more digestible than the $79.96 price tag. 

7. Attention Bargain Shoppers: Dropping prices to rock-bottom levels can definitely increase sales volume. Two pricing strategies fit under this umbrella:

a) Penetration Pricing, where you temporarily set prices artificially low to increase market share, and 

b) Economy Pricing, which is no-frills low pricing because there are little to no overhead expenses associated with manufacturing or marketing. 

In either case, it's important to point out to prospects how much less your price is or how much more they will save. Value Pricing like this becomes a popular strategy when factors such as increased competition or a recession are forcing you to act radically to keep or increase sales momentum.

It’s never easy to target just the right set of potential customers with just the right offer, value proposition, and price. These days, thanks to the Internet, customers have more information, more choices, and higher expectations than ever. But to keep pace with the intensifying challenges, businesses must continually refine elements of the marketing mix, and that includes price. 

Price testing and restructuring is an essential part of growing a business. Beyond that, stay at the top of the heap in terms of quality, and get your offer in front of more of the right audiences. It won't be long before your sales take a nice bounce higher. 

Copywriting services including e-books ghostwriting, sales letters, viral reports and more available at PetLeopard.com.

Are You Leaving Money on the Table With These Two Common Mistakes?

By Veronica Lim (Guest Blogger)

Are you getting enough income? Do you wonder how it is that other entrepreneurs seem to be able to get all the business they want while you struggle in relative terms?

When the economy is in a downturn, people are more careful about how and where they spend their money. Therefore, the rules of the game in our economy as we have it today are different.

But here's the thing. Whether we're in a buoyant time or a downturn, the fact is, people still love to buy. And as entrepreneurs, it's up to us to help them buy from us, if what we have resonates with them. But many entrepreneurs make two common mistakes that leave money on the table.

(1) Are you giving your clients something to buy at all?
For many coaches, consultants and service professionals, there is only one offering - the one-on-one service. That's it. When a client feels complete with one-on-one coaching, as an example, there is no other option available to them. Either they have personal individual coaching or nothing.

Some years ago, I offered a workshop. At the end of the series, the participants asked if there was another course that they could do. They were hungry for more! They were itching to pay me, to buy from me, and I had nothing.

By contrast, if, at the end of the first workshop series, I had been able to say, "A great follow-on to this workshop is..." How easy would it have been to get participants for that follow-on workshop? Effortless! They were already asking for it. Yet, I made life more challenging for myself by not offering the "obvious next step."

That is a mistake that many solo-entrepreneurs make - not having something else that people can buy from them. People like variety and when they find someone with whom they resonate, they will buy many things that are available from that same person.

It's the same as when we like a particular author. We buy the first book and enjoy it and then we buy the next one and the next one. Or a brand of shoes or from a particular shop that stocks goods that is to our taste. We just keep going back for more because we like to buy.

So give your clients several options, not just one. Perhaps you'll offer a 3-month coaching package as well as a 6-month coaching package, or you might have a group coaching program instead, or a home study version of topics you'll cover with them. This gives them more than just a single option which forces them to either take it or leave it.

As an example, take a look at my website. You'll find VIP Coaching, the Business Success Circle which provides some small group coaching, and you'll also find e-books.Clients often want something, if only you provided it.

(2) Are you giving them what they want?
Often, we get an idea about something that we think is great! So we create a product and put it out to the market. We fall in love with our own idea or product. Then we're disappointed with the lack of enthusiasm that comes back. What happened?

It could be that we didn't package it right. Or it could be that no one wants what we have to offer.

To get around making this mistake, ask. It's as simple as that. Ask your customer or client what it is that they want. What is it that would be the answer to their burning question right now?

Then ask them how they want it packaged. Perhaps they want it in book form, or audio, or video, or e-course, or a teleclass, or a workshop, or some combination of those.

Before you create your offering, do some market research by asking the people already on your list what they want and how they want it. Then create your offering to give them exactly what they say they want. It's a foolproof way to make sure you get it right! And there are even free tools to help you do your survey, like surveymonkey.com

YOUR TURN
People love to buy. Do you have anything else on offer that you can have them buy from you? And if you do, is it what they want and they most want it packaged? Ask them, listen and then deliver it in the unique way that only you can.

And by the way, remember to tell them what you have on offer too. This is often referred to as "marketing" (wink)... don't shy away from it.

© 2009 Veronica Lim

Business coach Veronica Lim publishes the "New Consciousness Entrepreneur Newsletter" every other Friday. If you are ready to make a living doing what you love, to grow yourself and your business and live the life you dream, get your FREE newsletter now at www.veronicalim.com.

Copywriting services including e-book ghostwriting, sales letters, viral reports and more available at PetLeopard.com.

Niche Marketing & Membership Sites: A Dynamic Duo Whose Time Has Come?

The E-book writing and website copywriting business offers more rewards than you might imagine. Not only is business online thriving for many of us, we're typically exposed to enormous amounts of new information. Much of it is stuff we can actually use. You might find some of it useful, too.

This is why I'd love to create a blog focused on the theme The Fascinating Stuff I Learn by Writing Someone's E-book or Website Copy. But alas, when recently ghost writing an e-book with a heavy bent on "nichefying," I learned that a blog focused this way might not be the best business-building approach. There's not much of a market for what I personally am learning. (Or is there?)

One's niche, I was reminded, should get right down to the lowest common denominator. In other words, it can be wasteful to advertise that you're, say, (just another) website designer. Instead, it's best to cull it waaay down to a specialty. For example, website creation exclusively for law firms or artists or health care organizations.

For more on niche marketing, check out:
-- Entrepreneur.com
-- Texas A&M University (Free PDF Report)
-- And this YouTube video:

We also handled website copy for a well-credentialed NYC business coach. This project led to a brush-up on the mastermind phenomena that's swept the Internet. If you're like I was -- not exactly sure of what masterminding is -- it's about bringing together a group of talents to help strategize how to move your business or practice fast-forward.

Our client, like some savvy others on the Internet, is establishing a mastermind group by teleconference. Hers, like many others, is a membership site, where she asks a $100 per month recurring fee to participate on her monthly conference calls. I'm impressed; I'm considering joining her mastermind group once it's officially launched. Bet I could learn lot in these sessions... Who couldn't use the help of an online business guru?

So wasn't the timing of Internet marketing expert John Chow uncanny?. . .

A day after completing the website copy project for the NYC business coach, John Chow issued to his email subscribers a free report for his joint venture (JV) partner Yaro Starek. Yaro is the successful go-getter behind Entrepreneur's Journey. His new venture is called Membership Site Mastermind. Pay to join and he'll walk members through the process of setting up their own membership site.

John Chow's email offered a link to get a copy of Yaro's viral report on setting up a membership site. I signed up to download Yaro's free report without hesitation. If you're interested, I highly recommend you sign up to get the viral report, too. Let me tell you, it is awesome.

So, through working on various ebook writing and copywriting projects, I learned a lot about two increasingly popular approaches to make money online:
1. Hone your niche down to a fine "long tail" science and then,
2. Offer your services not just on a one-on-one coaching basis, but as a one-to-many membership site driven model.

If these ideas inspire your Internet marketing efforts, PetLeopard.com can help with any copywriting services you need including website copy, e-book writing, sales letters and viral reports.

Copywriters Hop Links 5

In the spirit of Easter, copywriters hunting for eggs-ellence in writing might want to hop over to these five colorful websites. Each features food for thought about topics ranging from effective SEO press release writing and why writers' blogs are crucial for building a writing business.

@ Mashable: Make Press Releases More SEO Friendly (SEO Press Releases)

@ Copyblogger: 5 Immutable Laws of Persuasive Blogging (Writing Blog Content)

@ DailyWritingTips: 5 Reasons Blogging Leads to Writing Jobs (Blogging for Business)

@ Online Biz Guide: Useful Article Marketing (Article Marketing Tips)

@ And this bonus site for word bunnies: Wordsplosion.com (Signs The King Is Coming Soon)

Copywriting services including e-books ghostwriting, sales letters, viral reports and more are available at PetLeopard.com.