How to price and market efficiently?
Marketing is no layman’s game. It requires a great deal of thinking, leadership quality, and a perfect strategy to get out the desired result. But this has never stopped us Indians to go out in the market and try our luck in a general and seasonal business. The best businessmen across the world come from our proud states like Gujarat, Rajasthan, and Maharashtra.
Indian market stocks are amongst the highest purchased shares in any trading and that only occurs when your business is of good quality and has a positive market presence. Secondly, in the Indian share market, deals and companies fluctuate more often than you think especially since the Pandemic.
But, if we are being completely honest, pricing your products to meet your market needs isn’t that much of rocket science. After a good amount of productive research, we have come up with the perfect guide to marketing your products in such a manner that won’t incur losses.
Know Your Market
First things first, you should be clear about making money out of your creations. The art of pricing products is half creativity and half science. For example- If its a supermarket, you would be targeting customers of all ages who come to purchase at your store, but if you are starting a homemade baked goods business then your audience would become limited. Mass-produced goods like noodles, biscuits, laundry items, groceries sell in bulk, hence, earning a good profit margin. In the baking business, your customers would want cheaper prices of cupcakes, cookies, and brownies but you can certainly market them in bulk and earn good profit.
Calculate Personal Costs
One thing you must keep in mind while pricing your items is the number of finances you're putting in, or your investor is funding you with. Keeping a track of how much material, shipping, and transportation cost would it take will help you in understanding the amount of profit you'll be making per commodity. If you don't review all costs that go per product you might end up losing more than you started to spend with.
For instance, if the salesperson comes to your store to market their products, consider their choices as they're from your locality, and selling their products would cost you less then interstate goods.
Price with Market Value
Never, I repeat, never underestimate the market value of a product. Product pricing always depends on the supply and demand of that commodity.
For example, if you have an exotic cakes menu, and you price them 2 times more than the generic price, then you might lose badly. The reason being, most Indian middle-class people do not care about quality as long as there are quantity and discounted prices.
Organise your Taxes
If you are pricing your products for a retail store, you would be receiving a lot of commodities from mass retailers who profit in millions from wholesalers such as yourself. Apart from finding a trusted distributor, you should calculate the amount of taxes you are paying per material. Things to look for are- VAT, GST, CGST, SGST, and other additional charges that will be printed on your final invoice bill.
Try Psychological Pricing
Market trends keep changing faster than you start your second production, so keeping up is very important. There is a term called Psychological pricing. Do not be intimidated by the term, it means a customer's psyche plays an important role in a way they look at rates. Research has shown around 28% more profit via practicing this method.
For example, if a customer picks up 2 similar products who might have the same ingredients and the same weight, he's more likely to pick up the cheaper one as it will save him more economically.
You must keep on testing newer prices, attractive offers, and different combinations of benefits and incentives to encourage you to sell more of your stock at a commending price. Conduct new offers every month. Discriminating between prices means choosing the higher profitable products over lower-margin ones. This way the customer will smoothly be redirected to products they hadn't made a peep before.
Fun Fact: Supermarkets are stacked up in such a manner with one offer alternate to the next, that an average person who came down for just 3 items ends up spending 2 hours and also buying more.
Any loyal customer will keep coming back to you if you offer them a variety of choices to pick from. If you never change your prices, you would not be in business for long, at least not in profit. Know which product would sell like hotcakes, and which one might eat dust after six months.
Before you over or underprice a product, remember the customers are always on the lookout for his money's worth, and sometimes tend to buy higher valued products. Cheap pricing can also be perceived as low quality while overpricing might not sell them at all. So take your time and set that middle ground that settles it all.
Track Your Competitors
Keeping a track on your competition market is also how your customers value products. Analyse your products with them for similarities, using their rates as your base price, adding offers to your commodities, and subtly increasing the prices along with keeping in mind the demographic of customers. If they aren't willing to pay you, they ain't your potential client.
Industry Tip: Customers are pretty sensitive when it comes to pricing, hence, offering them a small gift or offer with every purchase every other month will keep them engaged with your company, even in the retail section.
Explore Modern Marketing/Payment Options
One thing that has made its way up in skyrocketing sales and offers in product pricing is having a single outlet for all transactions. People love to explore exclusive items with special prices that are only available on their portals.
For example, Your brownie package costs Rs. 150 on MRP, Rs. 130 in retail stores, but only 99 Rupees on your website, or Instagram business page with your direct calling number or email address. And the more they purchase, the lesser the price goes. This way not only do you skyrocket your sales, but word of mouth goes out smoothly.
If you are a beginner chances are you might make some mistakes in your pricing. But it's better to fail early and move on to do better. No matter how unique you think your product is, the customers always prefer the basics, hence, clouding your judgment. This is why cross-checking your market competition should be prior before you launch your product.
Be open to new product ideas, designs, customer feedback, and help build your brand into a bigger business. Click the share button and let us know which of these tips you might use the next time you price your product or the entire menu.