Pricing is not everything, but it can definitely affect how people perceive your brand and your products.
Before launching, you need to investigate and research the industry average in your location and from your competitors, excluding the outliers.
At Private Label, we use pricing to stabilize our customer lifetime value and retention, and even grow it over time. Here is my take, as featured on Featured!
Customer Life-Time Value
Your customers spend annually a great chunk of your revenue; a dedicated 100 customers can take your brand to a new level of success.
But some people treat their pricing as one-night stands. ‘’I want to rip off an extra $5 on this sale’’, You can absolutely do that, but in the next quarter, these people are not going to buy from you again!
You can’t plan a whole relationship based on a first date, but you can ace a first date, so the other person gets excited about waiting for the next one.
You need to understand that the first encounter matters, and you need to build a relationship, not a transactional one.
What Is the Successful Mindset
When someone buys from us, we don’t try to scare them with high prices on account of luxury; instead, we offer moderate pricing that can ignite word-of-mouth over time and facilitate you building reviews for your brand.
For us, this first purchase can grow to be a business deal with our wholesale or dropshipping services. Or a commitment to our stylists program.
So, you need to think strategically about how people perceive and interact with your brand, so you can win the long game, instead of burning bridges with a small niche that is going to run out.
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How Can I Price My Products?
Your margin should have room for marketing expenses, making a profit, and reinvesting back in your business.
But don’t put all of that on a single product; don’t overwhelm your clients with a high-ticket item when they can buy the exact quality for less.