Price is not just the ‘’4 p” component used to capture get a just remuneration for your products or services, it is also,to many a key driver of your image and Value perception. This is why trying to undercut the competition by always pricing below their market rate doesn't always work. People buy because of rational and emotional factors, and to many price represents a promise of quality. People buy certain things because they are expensive, and feel good about it. People have expectations of quality goods, and if a company has a reputation for delivering quality goods and services, they may choose it over the competitor despite higher prices.
When comparing prices, different elements help people switch from the mindset of those looking for the cheapest price and into that of wanting to maximize the value of what they can get.
Pricing research is about finding what customers deem valuable, and the corresponding price they are willing to pay.
Pricing can be a thorny and tricky issue when it comes to business. The prices that you charge for your services or products can have a direct impact on the profits and sales. The pricing strategy can determine how clients respond and view your product or services. Here are some ways on how to create a pricing strategy for a new product.
Pricing Research to Understand the Value of the Product
Conduct some pricing research on the market reaction of your products and services. Pricing & Value Research can help you understand the value of the product and how performance on key product attributes can change perceived value, hereby providing valuable guidance not just on price but also on product design (that will maximize perceived value) or segmentation (to adapt the offer to priorities of different customer segments). Your research can include areas like which products are likely to be successful, what the customers is willing to pay for your products, and which products customers see as offering the best value. Doing some background research can provides a strong foundation for your company's pricing strategy.