Perceived value.. raising the price of your stuff

4 replies
Has anybody else experienced this..

You sell a product for say.. $50 (base price isn't important) and it sells alright.. then you raise the price to almost double, and your sales increase?

I've been looking into this and I think the more expensive a product is, it increases the desire to own the product.

Has anybody else experienced this?

Alright, I guess a good example is the $1997 products out there.. and they often sell out.

But how about us regular joes? Have you noticed an increase in sales when you increase the price?
#perceived #price #raising #stuff
  • Profile picture of the author Loren Woirhaye
    Most direct response is more price sensitive than the guys
    telling you to buy their $2000 course (that will have you earning
    the investment back fast because they'll show you how to
    triple your prices and have customers showering you with
    dollars) would have you believe.

    Direct response businesses need at least one of these to win:
    1. Price advantage
    2. Exclusivity
    3. Service advantage


    Most of the IM gurus sell exclusivity. The illusion is that raising
    prices automatically makes you more money - it is the creation
    of the myth of exclusivity in info-marketing that allows the
    raising of prices.

    Two good books that deal with pricing and exclusivity are:

    "Uncensored Sales Strategies" Barrows and Kennedy
    "How To Sell At Prices Higher Than Your Competitors" Steinmetz
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  • Profile picture of the author JayXtreme
    It's a solid thought you are having, but not something that can be done randomly.

    You need to test various price points and find one that performs consistently, whilst still giving the customer the value, and quality they will be expecting for that price.

    It's no good simply hiking your price by 100% and hoping the "perceived value" will increase too. You need some data first, analyse the market/niche around you and move forward from there.

    Peace

    Jay
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  • Profile picture of the author Tomwood
    I increases the price of my Desperate dollar wso product and the conversion rate when down slightly but overall revenue is up.

    One thing I would like to point is that before increasing the price I added a considerable amount of value to the product.
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  • Profile picture of the author Dennis Gaskill
    You have to test different price points, but to answer your question, yes, I have raised the price with the result being more sales AND happier customers.

    My first product was a physical CD of web graphics I made. I priced it at $14.95. It was selling well, I thought, but a customer emailed me to say I should be charging more. I thought, well, maybe I should test that, so I raised the price by $5.00 and sales picked up. So, I raised the price by $5.00 again, now it's $24.95, and sales picked up even more.

    I didn't try another price increase because I honestly didn't believe the CD was worth any more than $24.95. One interesting point though, is that I got more positive feedback from people who paid the higher price than from people who paid the lower price.

    Same graphics, the sample size of each group was in the hundreds so it was large enough to establish which price group thought more highly of their purchase, and it was clear that those who paid more liked the graphics more, or were at least more willing to express their satisfaction.

    Perceived value? I used to think it was ALL about perceived value, and I still believe that has a lot to do with it, but I've recently come to believe there's more to it than that. We all like to think we make good decisions, so when we pay more we want to like a product so we can validate our hope that we made a good decision.

    Well, I kind of got off track there, I just thought it was interesting that people who pay more seem to like the product better. It still comes down to testing different price points to find which one delivers the most profit. Sometimes you'll sell enough extra units at a lower product that you make more than you would at a higher price, sometimes not.
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