HOW DO YOU PRICE YOUR PRODUCT OR SERVICE IN A HIGHLY COMPETITIVE MARKET?

7 Strategies to get People to See Past the Price

In today’s business world, there is more competition than ever before. When competition heats up, many business owners drop their prices to draw customers away from competition.

But as we all know, this is not very smart. This strategy generates more work, more stress and way less profits. It leads you to become a busy fool and is not a long-term sustainable business strategy.

So, how do you compete with a similar product in a highly competitive market?

Here are 7 proven strategies I have used over the years to compete with similar products in highly competitive markets and get people to see past the price barrier.

7 Steps: Build a Smart Business Engine Masterclass

Price Your Product Strategy # 1 – Is your business built on price?

Is price is the only weapon you fight with? Do you undercut quotes and drop your price to win business? Many businesses do this.

What brings customers to you other than price? If nothing, they will simply move on to where the next cheapest advertisement leads them.

There is no sustainability in this product positioning or selling strategy. Besides eroding your profits, you are in danger of building a “cheap price” reputation – one that says no one ever pays the full price with your company.

This reputation has nothing to do with how great your products or services are or how excellent your company is (the reputation you want to be building).

Remember this – you teach your customers how to behave.

If price is your weapon, it’s time to change strategies.

Price Your Product Strategy # 2 – Who are your real clients?

Not everybody is your client. This is one of the most common mistakes salespeople, and business owners make. They try to sell their products and services to the wrong customers, to people who are not their real customers.

You can’t sell beer to a non-alcoholic. It doesn’t matter what price you try to sell at, how great your sales pitch is, how fancy your advertising is and how much effort and energy you put into convincing a non-alcoholic to buy your beer– they are not interested in buying it.

Find a starving crowd, and you will sell more hotdogs in way less time and at a higher price.

Focus on discovering your customer’s pain or problem. Then rather than offering a lower price to win the business, promote how your solution will fix their problem or remove their pain.

Price Your Product Strategy # 3 – Don’t set your price according to your fear barriers

If you knew the answer to solving the universe, you could charge whatever you wanted to reveal it. Why? Because the answer to solving the universe is perceived as very valuable.

If you believe that the only way you will get people through the door is by price, or if you charge a higher price, you will scare customers away, then you do not understand or believe in the value of your product or service.

Set your price according to what your product or service is really worth, not according to your fear barriers.

Price Your Product Strategy # 4 – Be unique, not cheap

Create your x-factor.

This is not news. Everybody knows this. You need a USP (a unique selling proposition), but how many businesses have an effective one that truly separates them from the competition?

Not many is the truth. Most think they do.

“We really care, our customers love us, we take the extra step, we listen to our customers etc., etc.”

Sound familiar? Everyone says this. These answers do not separate you from your competition.

If you can’t tell your customers why you can solve their problems better than your competition, then you don’t have an x-factor. And therefore, you will have a harder time justifying a higher price point.

How do you create a killer x-factor? There are 4 steps:

Step 1 – What are your real customers deepest pain points?

Step 2 – What are your real customers most desired outcomes?

Step 3 – What is your competition doing wrong to frustrate your real customers?

Step 4 – Plug the gaps and create your x-factor

My second business was a distribution business. The product was ink cartridges which is one of the most competitive industries with almost zero barriers to entry. Anyone can sell ink cartridges.

However, I created a unique concept that to sell my product and created a business valued at $3.5 million in under 3 years.

I followed the 4 steps above.

Step 1 – What are your real customers deepest pain points?

Customers buying ink can never remember their cartridge numbers or printer model numbers, so they often purchased the wrong ones.

Step 2 – What are your real customers most desired outcomes?

Customers wanted an easy way to remember their cartridge number.

Step 3 – What is your competition doing wrong to frustrate your real customers?

All the cartridge manufacturers have complicated numbers for each cartridge. A very unfriendly consumer solution.

Step 4 – Plug the gaps and create your x-factor

I created pictures for each cartridge, so customers had to remember a picture, not a complicated number. For e.g.: a strawberry for a Canon BCI-21C, a parrot for Epson TO27091C and pencils for HP51649A etc.

My x-factor was “No more complicated numbers. Just remember your picture, buy the right cartridge every time.”

If you would like to see exactly how I did this, you may wish to check out my free training workshop –“4 Part: Joint Venture Secrets – Rapidly Grow Your Business by Leveraging.”

This rapid growth of this business was built by leveraging off the infrastructure, experience and reach of other businesses.

Price Your Product Strategy # 5 – Sell your solution, not your product

The previous strategy was creating your x-factor. This is what you need to become known for, your unique solution, not your product.

This way, you take your clients attention away from price. This is how you separate yourself in a highly competitive market and do not have to worry about price.

Here’s a great example to demonstrate this.

At the time of writing this, it is Easter weekend here in Australia. My kids were playing outside, and they broke a window. Being easter holidays, getting someone out was a challenge. But I needed to get the window fixed asap. Urgency was my pain, my problem, not price.

The company I chose to fix my window was called ASAP Glass Repairs. I was sold on their solution, not their product. There are hundreds of glass repair companies all selling the same product, but not the same solution.

So, create your x-factor and become known for it.

Price Your Product Strategy # 6 – Design powerful customer engagement tools

You do not make money because you have a great product or service.Pallets of stock stuck in a warehouse do not make you money. Your ability to market and sell better than your competition does.

Customers need to understand the value of your product and service. One of the best ways to achieve this is by creating a powerful, customer engagement tool.

A great customer engagement tool should include the following:

– A step by step process outlining how you get your customer from their pain point to their desired outcome.
– Reasons why your customer should choose your solution, not competition
– FAQ’s (overcoming obstacles and objections)
– Testimonials of happy customers
– Clear call to action. If customers are interested, what’s the next step.

Price Your Product Strategy # 7 – Bundle for greater value

One of the best ways to avoid price wars and having to compete on price on similar products or services is to create “value” bundles.

Rather than selling individual products or services where prices can be easily compared, create bundles that offer a great solution for your customers.

A great example of this was in my first business, where I was selling computers. This is a fiercely competitive market, and customers are very easily able to compare specs and prices.

I created the “The All in One Ultimate Family PC Bundle”. It bundled a computer, a printer, software (games plus other). The bundle created a solution my real customers (families) wanted.

I sold over $10 million of these “bundles” while my competition was fighting over price on individual items.

Our first super store in Durban, South Africa where thousands of these “Family PC Value Bundles” were sold.

This article is all about pricing your product or service in today’s competitive market and getting customers to see past price barriers.

But this is only one part of building a successful business for the future.

What you want to do is build yourself a smart business engine that does the work for you. And there are seven steps to do this.

If you enjoyed this training, you may wish to check out my 7 Steps Masterclass – Build a Smart Business Engine to Give You Time and Money Freedom.

I show you real life case studies and lessons to stop trading time for money, optimise your business & create a valuable asset for life.

It’s valued at three hundred and ninety five dollars but it’s currently free. You can register on the link below. You will also receive the seven steps downloadable blueprint.

7 Steps Masterclass – Build a Smart Business Engine to Give You Time and Money Freedom.

Thanks for your company and if you are joining me in my masterclass, I will see you there.

All the best.