Find Your Product’s Optimal Price

To determine the optimal price of FitBark, Davide Rossi put plugins on the FitBark website that asked customers two simple questions. These questions were: “At what price does this product become too expensive?” and “At what price does this product feel like a steal?” People who answered the questions got a $10 discount and FitBark got tons of valuable data that helped it choose the … [ Read more ]

Clawing Your Way Back from a Discount

Retailers typically follow one of two approaches on price promotions: They’ll discount that PDA to $349 for awhile and then bump it all the way back up to its regular price of $499, or they’ll tout their “everyday low prices” and leave it at $449 indefinitely. But a third tactic beats both, new research indicates.

A store can generate more revenue after a $349 promotion by … [ Read more ]

Tracking Pricing Effectiveness

Every company should have a set of pricing metrics that measure the financial and operational health of pricing across the business. These metrics may include simple data, such as the average selling price, discount, and margin for key products; operational data, including the number of pricing exceptions and win/loss percentages; and special measures to track the progress and impact of specific pricing initiatives. Best-practice companies … [ Read more ]

An Alternative to Price Cuts When Customers Are Fearful

In a downturn, some consumers and businesses cut back because they just don’t have the money to spend. Many more prospective customers have the money but feel uncertain about the future. Spooked consumers won’t buy more until they feel that it is safe to do so, or until they decide that prices have dropped as far as they’re going to. A company needs to understand … [ Read more ]