The successful producer of an article sells it for more than it cost him to make, and that’s his profit. But the customer buys it only because it is worth more to him than he pays for it, and that’s his profit. No one can long make a profit producing anything unless the customer makes a profit using it. —Samuel Pettengill, U.S. Congressman, 1930s On the Internet, time waits for no company. Your customer has access to tons of information through the Web.
Your competitor is a mere click away. You have to get the price right... the first time. In the digital market scene, there are very few second chances. Pricing is risky. What price is too high? What price is too low? Will a certain price work three months from now? Do you know? Do you know for sure? Pricing is one of the most important marketing decisions you will make. So much hinges upon it… If you’re selling a commodity, you already know that your profit margins have to be razor-thin. You’re forced to compete on price. It’s sometimes the only thing that sets you apart from the field. And your business has to be seamless in its operation. Gaps are too costly. If you have a proprietary product, its uniqueness and benefits have to be recognized as such by the market. You have to know if your product has enough
Perhaps you’re considering a new product concept? Not sure if it will fly? Imagine if you could know how much exactly people would pay for it. You’d know if this new idea would be worth pursuing... or not (just think of the dollars and time saved). Launching a new product? How will you price it? How do you know the absolutely perfect price —
the price that will maximize your income, right from the outset? What about existing products that you sell? Market conditions change rapidly — is your pricing up-to-date? Smart pricing maximizes returns, at launch and all the way through the product maturation cycle. And what do you know about your customers’ online buying habits? How many buy this kind of product on the Internet? How much do they usually spend? All of this is critical information to have before you begin to s