By Matt Farber
It might be safe to say that cost is a key factor when it comes to purchasing a product or service from a company. Now this naturally depends on the product or service and what it will do for someone, but it’s something in the back of everyone’s mind when going through the purchasing process. Have you ever looked at your how your pricing page performs versus some other pages? I’d be willing to bet the number of views is higher than most pages. For me, when I’m ready to buy something, the first thing I usually look for is the price tag. Sure, some products may change my life, but if it’s out of my budget it’s out of my hands. Let’s look at how your company’s pricing strategy affects what you do from a marketing perspective.
Get to know the buyer
This should be at the core of every marketing initiative any marketer ever takes. Who are your potential buyers? What types of problems do they have? Will your solution solve all of their problems? How much revenue do they bring in? Understanding some simple properties like these will assist you in developing the marketing plan. Specifically, you should leverage your buyer’s information to develop a value proposition.
Match pricing with the Value Proposition
Value propositions come in different shapes and size. Two different companies could be selling a similar service but their value proposition could be dramatically different. Here’s an example:
- Company A: Their value proposition references being a thought-leader, an industry professional, someone who knows all the ins and outs of the industry and delivers top notch results
- Company B: Their value proposition speaks to operational efficiency, customer service, and helping solve customer problems.
When looking at these examples, it’s safe to assume Company A has a higher price point. Your pricing strategy should reflect what the mission statement says.
This may go without saying, but looking into what competitors are charging will be beneficial. It doesn’t stop with just the price though. Compare value propositions with pricing and reflect on the value you offer versus your competitors.
How much will someone actually pay
This may seem obvious a bit obvious but it should not be overlooked. This goes hand in hand with understanding your buyer, or as we call it, buyer persona. Taking a long look at what it being offered, the obstacles it helps people overcome, and who the people are buying it should be at the core of setting your pricing strategy. Once all this is complete, it will give you the information you need to better market to your buyer personas. What types of messaging would be ideal to send? I’d say the type of messaging you use in your value proposition would be a great place to start.
How do you leverage pricing models when it comes to sending marketing messages?