So how to charge premium pricing in your business and should you do it?
The psychology of pricing: “You get what you pay for.” It seems we have heard it our entire lives.
No one seems to be able to pinpoint the exact origin of the expression, the problem is it makes too many business owners feel they can’t charge what they are worth. A lot of business owners and entrepreneurs tend to overlook how they are positioned in the market, thats a key reason they can’t charge enough.
Keep reading this blog for more.
Let’s talk about how to charge premium pricing in your business.
What Is Premium Pricing?
Premium pricing involves strategically pricing your products or services higher than your competition.
In some instances, some shoppers don’t search for cheap prices because they look for exclusivity. Premium pricing is the perfect fit for business owners who like to give a better service to their customers while making more profit.
Business owners often feel they need to reduce prices to get a sale. However it can also push people away, they feel your product can’t be high enough quality so will use your competitors instead.
The purpose of pricing your product at a premium level is to cultivate a sense in the market of your product being just that bit higher in quality than the rest. It works best alongside a coordinated marketing strategy designed to enhance that perception.
It’s natural to focus on the weaknesses of the competition. Companies have more success with premium pricing when they concentrate making valuable products worth the higher prices.
Now you know about premium pricing, how can we charge premium pricing in your business? First here are some examples how you can charge your customers premium prices.
- Add new premium products to your business
- Create bundles so client buy more from you each time
- Charge for a faster service, people like to jump the queue
- Reduce quantities of your products so they are limited
How To Charge Premium Pricing
An important part of everybody’s business is where they tell their stories/histories. You must share a few things with prospects so they start to know you, like you and trust you.
- Why you’re doing this
- What’s the reason for doing this business
- Why did you start
- Where have things gone wrong, be vulnerable
- .. and all those little intricacies
People buy into people. We all know stories of the big brands, Apple we know they started in a garage, Google’s the same Facebook started at a university.
Yet most small businesses never share their stories.
Telling your story is vital so they know you are the expert in your niche. Why don’t you check out my story and find out a little more about me here.
Rolex is a good example of a company that effectively uses a premium pricing strategy to great success. You can buy a watch for £10 if all you want is a watch that can tell the time. However a £10 watch is really hard to sell, go to any store selling cheap watches they will have so many in stock.
However if you want a Rolex even if you have the money they are super hard to get. Thats because over the years they have told a story or craftsmanship that has sold the watches to collectors and the rich and famous. They are expensive and because quantities are limited people like to collect them which drives up the price even higher.
Its a real advantage to do that to share your story on your business and you will get really good results.
Are you telling your story in your marketing?
If you want a shortcut to growing your business getting a coach or mentor can fast-track your results. Check out my new blog post on how to get a coach or mentor here.