It’s no secret that your prices can have a huge impact on the success of your eCommerce store. But there are plenty of secrets and strategies you can employ for better pricing that will make your store a success.
Here are 20 secrets for best eCommerce pricing that will put you ahead of the competition.
Customers Expect Free Shipping
You may think that offering free shipping makes for a good promotion or discount opportunity. But that isn’t always enough.
Dan Kogan, senior account manager for 1Digital Agency said in a phone interview with Small Business Trends, “Because companies like Amazon and Zappos offer Prime membership and free shipping, most people are already trained not to pay for shipping unless it’s for expedited shipping.”
People will Pay More for a Better Experience
But it isn’t necessarily true that customers are always searching for the lowest prices out there. If you can provide them with a product that’s of a higher quality, a shopping process that’s easier or more convenient, or even better policies than other eCommerce sites, they might just be willing to pay a little extra.
Customers Pay Attention to Context
In addition, the things that surround your product on your site can make a big difference in what customers are willing to pay. If you have a professionally designed website, great photos and lots of useful features, customers are more likely to see value instead of just looking at the price tag.
You Don’t Need to Use Manufacturer’s Price
For eCommerce sites that sell products from other manufacturers, it can seem like the easy or smart way to just use the manufacturer’s suggested retail price. But you’re probably not the only site selling those exact products at that exact price. So going that route will only make you blend in. Going just a bit above or below could make customers see a great deal or a great perceived value.
Competitive Pricing is a Good Idea
In addition, it’s not a great strategy to set exactly the same prices as your competitors, even if you make your own original products. While it makes sense to do some initial research to determine a general price range, setting the exact same prices won’t do anything to set you apart from the competition.
Your Policies Can Impact Your Prices
Another thing that can impact what customers are willing to pay is your policies for things like returns, exchanges and shipping mix-ups. If customers know that they have the option of returning a product that doesn’t fit or work out, they are likely to pay a bit more than they would at a site that doesn’t offer returns or cover them in the case of shipping mishaps.
You Need to Plan for Returns
However, if you do choose to offer returns and/or cover the cost of any items lost or damaged in the mail, you need to consider those things when coming up with your prices. Don’t sell everything at or just barely above cost if those expenses will then force you to lose money on sales.
You Don’t Need Constant Prices
When you set prices for your products, you don’t actually need to leave them as-is. In fact, changing prices throughout the week or even throughout the day can be a good strategy for lots of different businesses.
Kogan explains, “We have a lot of clients who will study the trends and buying habits of their customers and then change their prices throughout the day to really take advantage of those trends.”
You Can Use Analytics to Determine Trends
If you’re going to use dynamic pricing, you really need to study your site analytics to determine who is visiting your site, when, and what prices those visitors are most likely to pay. This means that you’ll likely have to do a lot of testing to figure out the best prices for each time of the day or week.
You can Set Prices Just Under Major Values
If you’ve decided that your item should be priced around a major value like $100, it can be beneficial to set the official price just below that, at $99 or $99.99, just so it looks a bit less expensive upon first glance and so that it will show up in searches if customers are looking for items below $100.
But Remember, Not All Customers React the Same
However, different numbers and pricing formats can have different effects on different customers. So it can be beneficial to do some market research or even try out different pricing structures on your actual site to see what best resonates with shoppers. You might find that big round numbers work best for your particular customers. Or you could have extra luck with prices ending in 4 or 7.
Simplified Price Tags Are A Draw
But even if you find that your prices require some decimal points, or if you sell products that cost more than three digits, you may need to simplify the actual look of your prices. Instead of $1,999.00, you could display $1999. This looks neater and shorter, even though it’s the exact same price. You can even make the decimals smaller than the main number if you have a price that ends in .99.
So Are Buy One Get One Discounts
When it comes to discounts, not all price reductions are created equal. Offering a buy one, get one at a discounted price promotion can encourage customers to buy more products than they normally would, or keep you from taking a loss on some of your sales.
The Bigger the Percentage on Discounts the Better
In addition, offering buy one, get one discounted promotions can make a deal seem really great. For example, if you offer a buy one, get one 50 percent off deal, customers are only actually getting a 25 percent discount on their purchase. But seeing that 50 percent can draw more people to your sale than 25 percent would.
Promotions Can Convince People to Buy More
You can also offer a discount, free shipping or added gift for people whose orders are over a certain price. And by setting that price at just over your average purchase total, you can encourage customers to buy a bit more than they normally would.
So Can Product Bundling
Another way to encourage people to buy multiple items is by bundling some of your items together. If you sell a few items that are similar or that could go together in some way, set a bundle price that’s just below what those items would be when purchased separately. That gives customers a better value, while helping you make additional sales.
Loss Leaders Aren’t as Effective Online
Loss leaders, or products that are sold with little or no profit margin in order to bring in shoppers, are popular at brick and mortar stores. But because selling online can be a faster and more direct process, this strategy isn’t always effective. So you want to be very careful when discounting products or offering products with slim margins.
Your Words Matter
It isn’t always enough to just use numbers to describe your prices. You can actually have an impact on customer opinions by describing your prices with words. For example, if you’re offering an exclusive deal just to your email subscribers, make sure and let them know it’s exclusive. If you’re offering your biggest sale of the year, tell customers that’s the case. And if you’re selling something for $5, you may be able to gain some interest by describing it as “only $5” or “the low price of $5.”
You Can’t Trick Customers
But while you can sometimes impact customers’ opinions by changing the way you describe your prices or promotions, you shouldn’t try to outright trick them. If you offer an item for one price, then add on a bunch of secret fees at the end, they’ll probably just abandon their purchases. Making your pricing look as attractive as possible is one thing. But lying about or hiding part of your prices can only turn customers off.
Nothing Is As Good As Free
Whether it describes your shipping, a gift included with purchase or any other type of promotion, nothing is going to get your customers’ attention more than the word “free.” So any time you’re offering anything for free, make a really big deal about it.