Why Good-Better-Best Prices Are So Effective
When most managers think about pricing, they harken back to their days of Economics 101: a rote downward sloping demand curve and an asterisked point labeled “perfect price.” At this optimal price, elasticity is such that it does not make sense to raise price (because the extra per unit profit is overshadowed by lost sales) nor discount (because increased sales don’t compensate for lower profit … [ Read more ]
Content: Article | Author: Rafi Mohammed | Source: Harvard Business Review | Subject: Pricing
How to Find Out What Customers Will Pay
How do you find out how much your customers will pay? It’s simple: Ask them. Of course, you can’t ask customers directly how much they are willing to pay — they’ll likely shade the truth (by giving a lower price) to their benefit. That said, there are a variety of ways to better understand how your customers think about your price. In my work, I … [ Read more ]
Content: Article | Author: Rafi Mohammed | Source: Harvard Business Review | Subject: Pricing
Interested in the Quickest Route to New Profits and Growth? Focus on Your Pricing
There is a fundamental ‘profit disconnect’ in business today. Companies work to bring a product to market by investing significant effort and money in research and development, distribution, and marketing strategies. But when it comes to setting a price – how businesses get compensated for their hard work and financial risk – most companies drop the ball. Critical pricing decisions are often made using arbitrary … [ Read more ]
Content: Article | Author: Rafi Mohammed | Source: ChangeThis | Subject: Pricing
The Art of Pricing: How to Find the Hidden Profits to Grow Your Business
Mohammed’s breezy, informal account of a range of pricing strategies takes as its starting point the realization that different “customers place different values on the same products.” With this in mind, Mohammed (Internet Marketing) recommends a variety of strategies that will attract customers with different product evaluations and yield different profit margins. With emphasis on familiar consumer practices like quantity discounting, early-bird discounts and mixed … [ Read more ]
Content: Book | Author: Rafi Mohammed | Subject: Marketing / Sales