How much should something cost and what does that say about it?
When you’re starting a new business or bringing a new product to the market one of the first things to consider is how much to charge for it.
The right pricing strategy is crucial to the success of any business. In its most simple form you need to define the boundaries between too cheap and too expensive – too low it won’t be profitable and too high and people won’t buy it. However, there’s so much more to it than that of course. The price you give your product or service will position itself in people’s mind as either the budget option, the middle of the road or the “quality” or the “premium” option so you need to decide where your product should sit in that pricing hierarchy.
Some clever people have made a fortune repackaging a fairly average product as premium and got away with selling it as more expensive purely through marketing. Stella Artois’ “reassuringly expensive” slogan is a good example of this. It really depends on your market and your consumer whether or not you can get away with positioning a product as premium, so do your research carefully before you take this route.