How To
Market The Price Of Your Products And Services
By Tom Egelhoff
 One of the most common questions
I get from either start-up or established businesses is, "How
do I price my products?" The short answer is marketing.
I have an ongoing debate with some local realtors that a good
real estate marking firm can make a house worth more than any
other home around it regardless of size, appraisals or other
benchmarks of value.
Everyday we hear stories of people spending ridiculous sums
of money for all kinds of common products or services. Is anyone
reading this article willing to shell out $400.00 for a haircut?
Nevertheless people do it every day in some parts of the country.
It's not the cut that demands the high price it's whose doing
the cutting. Is Starbucks Coffee really worth four times what
a regular cup of coffee costs? Or is it just the perception that
their marketing has created? And therein lies the message.
If you think about it there are hundreds of products and services
that you felt were ridiculously priced the first time you heard
about them. The "Pet Rock" comes to mind.
Features
& Benefits
The first lesson any advertising student learns is that in
advertising you stress the benefits of the product or service
not the features. It's not what the painting is of that makes
it valuable it's who painted it. A sedan has four doors. A feature.
So what? The benefit is that grandma can get in and out easier;
there is more room for the dogs and kids. To the right market
that means convenience and life is better. So when you sit down
to decide what you or your product is worth, the marketplace
only dictates the price if you allow it to do so.
My new years resolution for last month was to join a health
club, which I did. I could very easily save the $700.00 dollar
yearly dues by walking, doing sit-ups, push-ups and aerobics
at home. However, at home I'm not disciplined to do those things
or I would already be doing them. So I am not paying to exercise
I am paying for someone else in this case a trainer
to whom I must be accountable. I am not paying for the health
club I am paying instead for an emotional benefit that I seem
to be unable to provide for myself.
Positioning your price
You may be thinking that this looks good on paper but how
can I ask more than my competitor for the same service? Let's
go back to the haircut analogy I used above. I pay $14.00 every
three weeks or so to my barber not $400.00. My barber could ask
$400.00 and he would lose me as a customer. But he might gain
several people happy to lay down $400.00 for his services. The
point here is that you target your products and services to those
people in a position to pay for it and present them with the
benefits that make the service worth the price.
Is this easy? Of course not. But when you begin to think in
these terms and construct a plan it seems more doable.
Is it logical?
This brings us to the final thought for this article. Here
is the rule; "When emotion and logic come into conflict
emotion always wins." As much as we would like to believe
that we look at things logically before we buy them we do not.
Does "impulse buy" ring a bell? Did you ever buy a
CD to get one song? Human beings make emotional decisions then
create a logical argument to support that decision.
So I put my house on the market this week for half a mill
even though its been appraised at around $180,000. What makes
it worth so much more? Simple I will have lived there. When I'm
a rich and famous author you can charge the tour buses that come
by. I've got a waiting list already.
(Return
To Small Town Marketing.Com Main Menu)
Listen
to a radio interview with Tom and Entrepreneur Magazine - Click
Here!
This article may be reproduced for your non-profit
group or organization provided it is not altered in any way and
the following is attached:
©1998 - 2005 Eagle Marketing PO Box 271 Bozeman, MT
59771-0271
http://www.smalltownmarketing.com - (406) 585-0219 - Toll FREE
(888) 550-6100
email: tommail@smalltownmarketing.com
Based in Bozeman, MT, Tom Egelhoff is the author of How To Market, Advertise & Promote Your
Business Or Service In A Small Town, and The
Small Town Advertising Handbook: How To Say More And Spend Less.
He is also a seminar and workshop presenter
and trainer. He may be reached at 888-550-6100 or PO Box
271 Bozeman, MT 59771-0271
Can't
find what you're looking for?
Click here >  < Click here
Our Search Engine From Right Now Technologies
is amazing. Take a Test Drive.
The best small
business guides in print today! I guarantee it - 100%!!
Haven't you done without them long enough?
Decide
which order option below is best for you.
|
Order TOLL FREE USA/Canada
1-888-550-6100 FREE Shipping
