How to Price a Product? An Informative Guide (2021)

Introduction

Want to price a product by yourself but don’t know the correct strategy? Don’t worry! If you are not a market expert or never had a hand over the product pricing earlier, you must be very conscious of how to price a product and how prices are determined. It is one of the deciding factors that bring more traffic to your website or product because around 90% of online buyers spend their mostly surfing hours comparing prices from different websites. In this article, we will learn the subtle art of pricing new products, how to price your product, the correct pricing approach, and how to price a product calculation.

1. How Should I Price My Products?
2. Why This Pricing Approach Works?
3. How To Price Your Product?
4. Test And Iterate Once You’re Live

1. HOW SHOULD I PRICE MY PRODUCTS?

There are multiple websites and service providers available online who will tell you the correct product price strategy and helps you in pricing new products in exchange for hefty money charges. As we know that pricing a product for your website is not only for one-time use, you will need this knowledge in the future also. So, rather than spending huge money every time, you may seek the following product pricing methods:

1. Keep an eye over the competitor’s product prices and set your prices nearby to that. But do not blindly copy the competitor’s Business Model. Make some changes as per your own business requirements.
2. To get the answer for how to calculate the cost price of a product, you may take help from some of the pricing product Calculating Tools.
3. Do not stick for too long on a singular pricing patterns and change the prices once you feel the traffic is increased to your website as this is the correct product price strategy. Keep the product pricing shift in a positive proportion and do not hike the price too much or reduce it too low.

2. WHY THIS PRICING APPROACH WORKS?

The Approach of Dynamic Pricing on how to price a product and strategically lowering product prices will help you in increasing revenue. As this approach focuses more on long-term business profits, it will give you various opportunities to do experiments with the pricing of new products. For knowing how to calculate the selling price of a product, there are websites like Quick lizard, Omnia Retail or Profit peak by Splitly, which can help you with ease.

3. HOW TO PRICE YOUR PRODUCT?

Meanwhile, for pricing new products, there are other multiple questions that need to be answered, such as how to determine the price of a product, how to set price for a product, how to calculate the selling price of a product, how to calculate the cost price of a product etc. Here are some tips and tricks which must be followed by one to get sail through the product pricing. 

• Add up your Base Price
• Add a profit margin
• Don’t forget about fixed costs.
• Raise prices on your Best Sellers
• Take Advantage of Seasonal Discounts and promotions.

4. TEST AND ITERATE ONCE YOU’RE LIVE

Don’t be afraid of any failures because one can learn more from its pitfalls. Pricing always grows with the business and profession, and as it is a long term process, one will get long term profit from the same investment. So be patient and keep a check on your prices pattern, their expenses and how much they are providing you profit. If they are providing you with some minimal or minor returns even within a small period of time then you might be on the right track. You can test and adjust yourself time to time anywhere in between during the process. Timely price comparison to see how your strategies working for pricing new products.

Taking this approach will give you a price you can feel confident about because the most important thing when it comes to pricing is that your pricing helps you build a sustainable business. Once you have that, you can launch your store or your new product, and use the feedback and data you get from customers to adjust your pricing strategy in the future.

CONCLUSION

After reading this article, we hope you might get an edge over How to Price a Product, product pricing methods, and the basics of product pricing with a more understanding and clearer view than before on this topic’s various dimensions. It will be more delightful for us if we receive some success stories from our readers if they benefit after reading this article.

Interested to learn all about Product Management from the best minds in the industry? Check out our Product Management Course. This 6-month-long program takes place online through live instructor-led sessions. It is the only program in India that offers the ‘Bring Your Own Product (BYOP)’ feature so that learners can build their product idea into a full-blown product, and go through an entire Product Development lifecycle. Not only this, but this is the only program in India with a curriculum that conforms to the 5i Framework. Post completion, learners receive a joint certification from the Indian Institute of Management, Indore, and Jigsaw Academy.

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