Power of CHEAP

[seobro]

Before our current severe recession, many people used words like "bargain priced," "budget," "ultra affordable," "low-cost," "thrifty," "inexpensive," "bare bones", "economical," and "deep discount", instead of using the word CHEAP.

Well, times have changed. Nobody wants affordable luxury now, they want CHEAP. They want to save a penny. In fact, the Dollar Store is full and the only two companies in the Dow 30 that did well are Wal-Mart and McDonald's.

In my own business, I have been forced to cut prices 50% to stay alive, and even so sales are down over 50%. In a depression price is king. Do not believe the giggling fools that say this is a temporary mild recession. Perhaps a mild depression, but if you do not act now the harsh hand of reality will slap you across the face. Cheap is king.

Write new ad copy where you use the word cheap a lot. Your product is cheaper than the competition. It is not a Ferrari, it is a Fiat. You want to sell a 99 cent McChicken, not a luxury meal. Emphasis on saving money, not on quality.

As the saying of Jack Cohen, the Londoner who turned a 1919 market stall into Tesco, the world's second largest supermarket chain: "Stack 'em high and sell 'em cheap."

[artwebster]

Stack 'em high and sell 'em cheap only works with goods in mass demand and produced to take advantage of economies of scale. You can't just chunter out something like this and think it makes sense!

Cheap is what cheap has always been - CHEAP!

I don't get out much but when I am rolled around in my little trolley, one of the things I notice above all else is that people looking for non-consumables are now paying the extra for the recognised brand because they know that they will get a good, reliable product with a solid guarantee. The days when they ciould afford to carry the risk of a cheap product letting them down have gone. Long term economy is what drives sales today and you should take a leaf out of the books of retailers making hay in this recession - sell quality!

[ehicks727]

Most small businesses can't compete on price. It's futile to try, and this is what causes many small businesses to fail... they try to compete on price.

This all assumes that the stuff you're peddling actually has some value... if what you're selling is actually "cheap" crap, then sell it cheap. However, if what you're selling has value, then sell it like it has value!

The name of the game now is differentiation. You must differentiate your product/service/company.

The easiest differentiation is customer service. Treat your customers better than any other competitor, and you will build a LOYAL customer base.

Differentiate yourself and your product/service on QUALITY. Believe it or not, there are still people with plenty of money, and they are looking for QUALITY goods and services.

However, if you want to struggle with razor thin profit margins, and needing to peddle mass volumes of stuff just to make a buck, then go on trying to compete on price. The rest of us will make easier money differentiating on customer service and quality.

[Michael Oksa]

Buying the domain CheapskatesUnite a year ago seems smarter and smarter every day.



People want to pay cheap prices but get high quality. Nothing wring with that. However, all too often, people don't really understand value - and the price tag that sometimes goes with it.

All the best,
Michael

[kaleidoscopecharm]

I agree people want to get quality goods instead of junk.

[Neil Morgan]

It would be easy to lose your shirt with knee-jerk reactions such as slashing prices simply because there is a [INSERT CURRENT CRISIS] going on.

Business sense still applies. Right now, it's even more important to know your numbers like the back of your hand - not just conversions but visitor value so that you can test prices (either higher or lower) to see what works best from a profit point of view.

I wouldn't be surprised if some folks post here to say they're in niches where they can price higher during a recession.

Cheers,

Neil

[archer29]

It's mostly a mindset in America to obtain a luxury lifestyle or at least give the appearance of having one. Once people realize they don't need tons of stuff to be happy then they learn to live on the "cheap" but with an eye on quality.

I once lived in a village outside of Milan in a small villa and all the doors and windows were trimmed in marble. The builder expected the home to last for generations to come, quite a different concept than what we have in the States. Not everyone owned a car, they got around on bicycles, and shopped at local farmer type markets that set up once a week. Petty crime was high (never leave a stereo in your car) but young teenage girls would be walking around at 10 or 11 at night with no fear of being abducted or raped.

Living there gave me a new perspective about longevity, whether it's building a home or growing a business. If a product has a need and is of good value, it will always stand out unless you're targeting the Walmart shopper.

[Trader54]

Quality never goes out of style.

Cheap is quickly discarded.

[Ryan700]

Originally Posted by seobro

Well, times have changed. Nobody wants affordable luxury now, they want CHEAP. They want to save a penny. In fact, the Dollar Store is full and the only two companies in the Dow 30 that did well are Wal-Mart and McDonald's.

In my own business, I have been forced to cut prices 50% to stay alive, and even so sales are down over 50%.

If you were selling a clickbank product as a vendor and decided to cut your prices in half just be prepared for more people asking for refunds. The people who look at price before making a buying decision are like that. Bob Burnham says that you should sell your book or product for as high as you can. Don't sell it cheap. You'll have more problems with people who only look at price. People pay for quality. Remember the saying: People who ask for the price of everything usually know the value of nothing.