Tips On Pricing Your Product In A Competitive Ecommerce Market

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With more and more players joining every day, the Ecommerce market game is becoming increasingly difficult to play. There are multiple vendors for the same product present, and even amongst themselves prices tend to differ widely. If you too are wondering on how you can effectively price your products in a largely competitive Ecommerce market, then we have some tips for you.

Know Your Customers And Their Purchasing Power

It is essential that you research and figure out exactly what it is your customers want, and what is their purchasing power. In a competitive environment, tailoring your product to make it more appealing to your customers, and pricing it according to their restraints, will go a long way in beating the competition. Keep in mind that your customers are likely to pay more for products that belong to a niche and are unique, and less for something that is present in large amounts.

Analyse The Competition

A thorough analysis of the market conditions and what your competitors pricing policies are needed to succeed in the ecommerce sector. Is there more demand than supply? If yes, then you can definitely drive your prices up as your product is limited and in high demand. If there is more supply than demand, then you can employ different pricing policies in order to maintain a price which is competitive.

Charm Pricing

This simple tactic is highly effective, and has been known to increase conversion rates by almost 100%! Charm pricing is simply reducing the selling price of the product by a rupee or two in order to make it more appealing to customers. Selling a dress for Rs. 999 instead of Rs. 1000 can actually go a long way in increasing sales! It’s a simple game of psychology, and customers fall for this much more often than you would think.

Skim Pricing

Skim pricing is a strategy used by many ecommerce giants, especially in the technological products sector. In this policy, you initially start selling your product at the highest price possible, and then gradually decrease it over time in order to make it more affordable for all customer groups. Doing this enables you to capitalise on all types of TGs- may it be the freely-spending customers in the beginning, or the more conscientious ones later on.

Discounts and Promotions

A good strategy would be to provide extremely limited time discounts and promotions. This would enable you to garner a customer base, who after buying from you once, is likely to return later on even when you are not running a promotional campaign. The key is customer loyalty and getting customers to choose your brand instead of others in the first place.

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