Whatever the size of your e-commerce company, online pricing really matters. When you shop online, the price of any product is very clear and helps shoppers to make a decision much faster and easier. Thus, the online pricing of a product is very crucial to any e-commerce site.
It is quite a challenge to figure out how much to charge for a product online. Here’s where we can help you! With our different pricing strategies, you can determine the prices of any product and earn a good profit.
- Cost-based e-commerce pricing
Cost-based, cost-oriented or cost-plus pricing is the most popular pricing strategy when it comes to the retail industry. It is simple and allows a store to set prices without much customer or market research. It also ensures for each product sold there is a minimum return. If you want to calculate the cost-based pricing, all you need to do is figure out the cost of the product and add a markup to create a profit margin.
- Market-based e-commerce pricing
Market-based pricing is as simple as it sounds. It is when you monitor what your direct competitors are charging for a particular product and allot your price relative to theirs. This pricing strategy is only possible only when your competitors also sell the same or similar products as you. You must assume that your competition has also done their research or is at least visible in the market that their pricing must be matched. When using this strategy, your aim must be to maximize your online retail store’s profitability.
- Customer-oriented e-commerce pricing
In all aspects of e-commerce, customers should be above anything else including pricing decision making. This pricing strategy requires both market research and customer analysis. You must profile your customers, consider the reasons they buy a product, understand which product features are important and know how vital the price is in the decision to buy. Customer-oriented pricing is when you make a number of subtle changes in prices as you learn new things. It is a relatively long process when compared to the other two.
- Bundle pricing
This is a fairly simple strategy. Product bundling is when you sell a range of products together for an amalgamated price. There is a difference when customers add individual products to their cart because it gives an economic idea that they will be more likely to buy when there is a considerable perceived value.
- Dynamic pricing
This pricing strategy is when you set adjustable prices for products taking into consideration your costs, demand of the market prices and targeted profit margins. You’ll be able to set the price when there is real-time demand and competition status, while keeping in mind your business goals. To makes life easy, there are a number of dynamic pricing and repricing software applications in the market today which will help you get recommendations from the collected data.
When you take pricing seriously and handle it in a smart way, you can see your business flourish. There is always room for improvement when it comes to pricing strategies. Let us help with your online pricing strategies so you can attain the best prices in the market and profitability. Get in touch with our pricing experts today! For more information, check out our website at: Online Retail Solutions