Whether you are looking to attract new customers or keep current clients coming back for more, the pricing of your merchandise will be a key factor. This is particularly true with internet commerce, where customers can easily shop a variety of retailers for the same item.
Pricing may seem like a complex process (and sometimes it is), but there are plenty of ways to simplify your pricing philosophies without undercutting your business. We have three pricing strategies to keep in mind as you begin to market your merchandise.
Finding the Competitive Edge
It is a fact of life that to be competitive in the drop shipping business, you must set your prices competitively. The best way to determine whether your pricing is competitive is through research, by scouring forums for pricing advice or spending time shopping online yourself.
However, don’t limit yourself to competitive pricing alone. Other factors can also put you ahead of your competitors, including low shipping rates and a liberal return policy.
It is also important to market your merchandise well, with full-color photos and comprehensive descriptions that help buyers know what they are getting. Offering relatively low prices is just part of the entire competitive package.
Everyday Low Pricing
Some retailers choose to offer everyday low pricing so that customers will come to their website first when they are on the hunt for an item. While these businesses may not offer frequent markdowns on their merchandise, they will typically provide some of the most competitive everyday prices on the Internet.
Everyday low prices usually set the price just below the Manufacturer Suggested Retail Price (MSRP), but some will offer a deeper discount as well.
This pricing philosophy often breeds the most loyal customers and reduces the amount of advertising needed because you build a reputation on regularly lower pricing, rather than seasonal discounts.
The Value of Sales
Sales can be an excellent way to attract new customers to your website and reduce unwanted inventory. There are three strategic times to utilize sales to your advantage:
At the beginning of the season, use a sale to introduce customers to new merchandise and get a jump on competitors.
Before major holidays, use your sales to attract more customers who are already in a buying mode.
At the end of the season, use sales to reduce stale inventory and build cash flow to purchase new merchandise for the coming season that will reap a bigger profit margin.
When you use sales as a marketing tool, you will need to sufficiently advertise your promotions to get the returns for which you hope. Advertising should be geared toward current customers in the form of newsletters or email blitzes, while general ads will help attract new customers to your business.
Strategic use of pricing is a key factor in the success of your retail business. When you learn how to price your merchandise competitively and use the occasional sale to your advantage, you will learn how to move your goods more effectively for a better profit margin overall.
Pricing may seem like a complex process (and sometimes it is), but there are plenty of ways to simplify your pricing philosophies without undercutting your business. We have three pricing strategies to keep in mind as you begin to market your merchandise.
It is a fact of life that to be competitive in the drop shipping business, you must set your prices competitively. The best way to determine whether your pricing is competitive is through research, by scouring forums for pricing advice or spending time shopping online yourself.
However, don’t limit yourself to competitive pricing alone. Other factors can also put you ahead of your competitors, including low shipping rates and a liberal return policy.
It is also important to market your merchandise well, with full-color photos and comprehensive descriptions that help buyers know what they are getting. Offering relatively low prices is just part of the entire competitive package.
Everyday Low Pricing
Some retailers choose to offer everyday low pricing so that customers will come to their website first when they are on the hunt for an item. While these businesses may not offer frequent markdowns on their merchandise, they will typically provide some of the most competitive everyday prices on the Internet.
Everyday low prices usually set the price just below the Manufacturer Suggested Retail Price (MSRP), but some will offer a deeper discount as well.
This pricing philosophy often breeds the most loyal customers and reduces the amount of advertising needed because you build a reputation on regularly lower pricing, rather than seasonal discounts.
Sales can be an excellent way to attract new customers to your website and reduce unwanted inventory. There are three strategic times to utilize sales to your advantage:
At the beginning of the season, use a sale to introduce customers to new merchandise and get a jump on competitors.
Before major holidays, use your sales to attract more customers who are already in a buying mode.
At the end of the season, use sales to reduce stale inventory and build cash flow to purchase new merchandise for the coming season that will reap a bigger profit margin.
When you use sales as a marketing tool, you will need to sufficiently advertise your promotions to get the returns for which you hope. Advertising should be geared toward current customers in the form of newsletters or email blitzes, while general ads will help attract new customers to your business.
Strategic use of pricing is a key factor in the success of your retail business. When you learn how to price your merchandise competitively and use the occasional sale to your advantage, you will learn how to move your goods more effectively for a better profit margin overall.
No comments:
Post a Comment