How can your Improve the Pricing of your Online Store?
Maintaining an Online Store is Huge on their Owners!
Pricing is something that is always on their minds.
No store owner , online or offline ever wants to lower prices as a result of low sales and slow performance.
To some, lowering the prices can show desperation and doing so might devalue the site and its products as well as clip into the already tight profit margin.
On the other hand, there are also those that believe its a good incentive that will actually encourage visitors to become actual shoppers and customers.
In reality, customers dont necessarily see the price of your products; they check whether or not they are getting a Good Deal (even if that potentially means paying premium)!
Here are Three types of Pricing you can apply to your Online Store than will make your products more appealing without having to continually lower the prices.
(1) Anchor Pricing:
A Price that customers use as a basis of comparison when shopping.
The key to this pricing strategy is to set the anchor high.
These are usually used to highlight the other tires of services seem like great services.
It harness the power of suggestion and gives your on-site customers a frame of reference.
When you all of a sudden set a “sale” price, which in reality is your normal price, for that item, customers will believe they are getting a deal on the “discounted” item. You’ll find that many online retail stores use this method because it’s very effective.
(2) Decoy Pricing:
Decoy pricing is a method of strategically pricing products so that consumers will choose the one that you most want to sell to them. This can work well if you have a certain product that reaps a greater profit margin or if you are over stocked on a certain item, and you don’t want to start discounting.
The less desirable option is obviously the “decoy” and therefore will have you customers turning their attention to your intended product of choice.
Example: To further justify the theory ,Ariely gave the below mentioned Economist Subscription options to 100 students from MIT’s Sloan School of Management.
The students selected as follows:
Economist.com subscription – US $59 (16 students)
Print subscription – US $125 (0 students)
Print & web subscription – US $125 (84 students)
……..Also check these hotel boooking rates
(3) Promotional Pricing:
This strategy calls for deeply discounting specific popular selling items for a (short) period of time. You really have to know the trends of when certain products become hot purchases for shoppers. This will make your promotional pricing even more effective, plus there’s no real sense in lowering a price on an item that no one wants to buy in the first place.
Promotional pricing is usually a short-term approach for companies, though some retailers use recurring promotional pricing as a way to maintain ongoing purchases from budget-conscious buyers.
The Best way to Utilize are Online Loyalty Memberships wherein your customers can reap on-going discounts.
Try out some of these Pricing Versions to different Products on your site and checkout the difference.
If you have any other successful trick, do drop-in your ideas!
Marketing & Communications @ AvactisNext