Believe it or not, sometimes a dead product or service can come to life by raising its price.
Let me say it again.
If you have a product or service that isn’t selling, it may be priced too low.
Price does several things to people. Beyond the economic effects of pricing, there are psychological effects. Part of pricing is perception of value. If you have a really great, high value service, with a small, under-market price, the perception you may be sending is that something is wrong.
If your offer is that great, why does it cost so little?
This isn’t as crazy as some think, but it is contrary thinking
Conventional pricing wisdom says if a product or service doesn’t sell, you should drop its price. And while it’s a fair strategy to drop price to test a product in the market, some products need to be raised in price to find demand.
A low price sometimes attracts a different buyer than intended. The low price market may not be aligned with the value of your offer. Especially a product or service positioned as premier, lowering your price can move you from your target market to one that could care less about your offering. And the market that needs your product or service discounts it because it’s priced too low. Low price must mean low quality.
Take care in your pricing, but never be afraid to experiment. Remember, you may need to increase the price a bit to attract the larger market.
What do you think?
Have you seen a great product or service that was priced too low to sell? Or am I nuts to suggest such a thing? Why?