By Kevin Nunley
Usually when you bring out a new product or service, you have an initial idea of how it should be priced. Sometimes your price is right on, but more often than not, it needs adjusting.
A cheaper price may bring more sales and increase your profit, but sometimes a cheap price does just the opposite. It leaves prospects thinking your product or service must not be any good, otherwise it would cost more. In those cases, higher prices lead to higher sales.
There's really only one way to figure out what the right price should be--Test!
Conduct a test where you sell the product or service for different prices in different locations. Offer your package for $5 in one city or neighborhood or zip code. Then offer it for $15 in an area some distance away.
This works on the Internet as well. The Net is such a huge place that readers of one e-zine, ad site or newsgroup are unlikely to see your ad running elsewhere on publications that address different interests. Keep your test brief and you'll quickly find the right price.
And while you're at it, you may wish to incorporate the idea of scarcity. Ever notice that when there's plenty of something, no one seems to want it anymore? It's that most basic element of business--supply and demand.
Nothing sells products and services like scarcity. As soon as it looks like there won't be any more of something, the price immediately goes up and people stand in line to buy it. That's a business person's dream.
You can gently use scarcity to improve your sales. I know a savvy business woman who always sends out a note to clients when she only has "three places left." People flood in to get those last three places. And what about all the rest who came too late? She signs them up for her next project to start immediately.
A while back, I called a mail order outlet to buy an item I'd been hunting all over for. The sales person said they only had one left and his associate was about to sell it.
"Wait a minute," he said. "The deal may not go through. If it doesn't, I'll have this last model for you to purchase."
What could I say? I had to buy it. Scarcity sells! Think about how you can use scarcity in your marketing plan.
Kevin Nunley supplies marketing advice and copywriting fast and at low cost. Ask for his FREE report by writing to Kevin at 9699S 2810W, S. Jordan, UT 84095. The phone number is (801) 253-4536. You may also find him on the Internet--the address is www.DrNunley.com
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