Who sell many physical products. It generally does not apply to more complex products or services, such as software or consulting services.
Competitive pricing – also known as competition-based pricing – follows the velocity to market for a product or service.
When using this pricing strategy, you will research the prices offered by your nearest competitors and offer your offers similarly. You can price your product at the same price, or slightly higher than your competitors.
Competitive Pricing Strategy
This pricing model works best in saturated niches where consumers can opt for a similar offer due to a slightly lower price. Just be careful not to join the “race to the bottom” – this is where businesses continue to undercut each other in an attempt Democratic Donor Email List to win more business, but unwittingly provide everyone with a profit.
In addition to offering your competitor’s product or service similar to what your competitor doesn’t offer, this pricing strategy applies to your product or service as well.
For example, Shopping’s pricing is very similar to that of its competitors, but the platform offers more features for the same price.
Psychological Pricing Strategy
If you walk into a discount store, you experience English psychological pricing.
This pricing strategy is about increasing sales using principles of human psychology . A common tactic is “charm pricing” – when the price is billed at 9, 99, or 95 for 95 cents, make it feel cheaper than it is. This works because the number appears smaller when one reads from left to right.
Another psychological pricing strategy is known as price anchoring. It makes the price look like a good deal by anchoring the price high and then CNB Directory offering a lower price. For example, ” $100 is now $75.”
If people in your target market are attracted by sales and discounts, this pricing strategy could be a good bet. However, these strategies don’t work when your target market is primarily concerned with quality and/or prestige.
