Determining the correct pricing for your product or service can be tough to measure. You never want to cheat a consumer but you don’t want to sell yourself short at the same time. When deciding on your pricing, there are a few strategies to help guide you to a set fee:
– Skimming Strategy:
The process of setting high prices based on value. It works around understand the value of your product and the willingness of consumers to pay for the worthwhile investment. This strategy works well for mature markets also emerging markets where consumers want the most modern, newest product available.
– Neutral Strategy:
This strategy the prices are set by the general market and are in line with competitors prices. It is the safest way to mark your pricing. However a major drawback is that your company won’t be maximizing potential profits.
– Penetration Strategy:
Being the lowest prices on the market. This strategy involves, making price cuts whenever and wherever possible. It works well when the product has already gained its value on the market and consumers want the cheapest price available.
Be sure to know your market when considering prices and also the long life and value of your product as well as the demographic it is most appealing to and their expenditure. Be smart with your pricing, so you will attain a good return on investment and develop brand awareness within your market.