How to Win in Business With the Right Pricing Strategy

Pricing is something we all do, but we don’t think about it very much.

Most startups focus on having the right product before finding the right pricing strategy for their business. That might be the wrong order.

Pricing is an important part of almost any business, and all new businesses I’ve seen suffer from not focusing on pricing early enough. This is particularly true for startups. A startup is new so it lacks the kind of brand recognition that would automatically command a premium price. Conversely, it typically doesn’t have deep relationships with its customers or stable margins, so it can’t offer the discounts that large companies do.

It’s hard to get pricing right without customers, and it’s hard to attract customers without pricing right. If you’re able to get price right, then you can use that information to help inform your product decisions.

Startups often focus on having the right product before they’ve found the right pricing strategy. I mean that a team tends to build a product and then see if it can be sold, instead of first seeing if there’s a market for what they’re going to build.

A business can’t succeed by selling below cost, nor can it succeed in the long run by only charging the going rate. Think about what your business does and how much value it really creates for its customers, and you’ll develop a pricing strategy that not only works well in the present but ensures you stay successful in the future

The best pricing strategy is the one that makes you the most money. The second-best one is the one that makes you the second most money. The worst, of course, is the one that loses you money.

What’s the best price to charge for your products or services? It depends on what your customers can afford, what they think they should pay, and what you think they’ll pay. The actual price is somewhere between these three variables.

Pricing is one of the most important decisions in business. It can make or break a company. And yet hardly anyone knows how to do it well. Most companies, when asked how they know what price to charge for their product, will either say “We looked at our competitors”, or “We looked at what the market would bear.” If that’s all you know, then I’m sorry to tell you that you’re guaranteed to lose.

The goal in Pricing your Startups is not to teach you the mathematics behind optimal pricing. There are other articles for that. The goal instead is to teach you to think like a professional and take control of your pricing destiny.

I’m deeply fascinated by pricing and by what people do with prices: the ways they negotiate, argue, and fight over them and how they use them to try and predict and control other people’s behaviour.

Pricing is one of the most important aspects of doing business. It is often the most difficult. Proper pricing is the difference between success and failure, between profit and loss. No matter what kind of company you’re trying to create, you will need to know how to price your product or service properly to succeed.

So I wrote a book on Pricing titled “Winning Pricing Strategy. I am excited. (You can get it here on Amazon or on Sellar)

Been thinking about it for a long time, but kept telling myself, I want to be a multi-millionaire before I write books.

Then it hit me like three months back. Why wait when you can offer value and help people and businesses today?

My work involves providing business advisory and marketing services for companies around the world. Worked with clients in Malta, India, Nigeria, the USA, Canada and the UK to help them start and scale their businesses.

One problem I find people pay less attention to is the effect their pricing makes on their overall business well being. I see a lot of accidental pricing with the hope that luck will shine on them.

I have put together valuable insight on how you can build a profitable business with the right pricing strategy.

What do you need to know to have a winning pricing strategy?

  • Learn different pricing models and strategies.
  • Learn how to communicate your price to your customers.
  • Understand the Psychology of your customer.
  • Learn about the factors that influence your pricing strategy.
  • How to incorporate pricing as part of your brand strategy.
  • The effect of choosing a wrong pricing strategy.
  • Learn about what investors want to see in your pricing strategy.
  • The effect of choosing a wrong pricing strategy.
  • How to design your product around the price.
  • Action steps to creating your pricing strategy.
  • The role of data management in developing a pricing strategy

All these and more are covered in my book titled “Winning Pricing Strategy”

You can get a copy on Amazon or on Selar here.

Have some feedback for me after reading? email me@buzzedison.com

Business Strategist, Building Products for companies using Web and Mobile technologies. Fractional CMO. https://www.buzzedison.co