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If you do not have a pricing strategy, how do you intend to boost your dropshipping sales? I am sure you have heard that most of your competitors have great pricing strategies. Here is the thing. If the price of your product is too high, you probably won’t land many sales. And if the cost of your product is too low, you might not make as much profit. To succeed, you have to select the right pricing strategy.

What Are Pricing Strategies

A pricing strategy is used to set the prices of products being sold. It is one of the marketing tools and is commonly used to portray the perception of a product or brand.

Different Types of Pricing Strategies

Here are the different types of pricing strategies that can help boost your dropshipping sales:

Keystone Pricing

This is when retailers or sellers determine the price of a product by doubling the wholesale cost they paid for the product. But this strategy is not always practical for products that are easily found elsewhere. Although for rare products, it ensures an ample profit margin.

Competitive Pricing

This unique pricing strategy follows the present market rate for a product. This strategy requires that you price your products based on research of the prices offered by your closest competitors. You could set the cost of your products the same, lower or higher than your competitors. This pricing strategy is more effective in a saturated niche where customers might pick one similar product because of a bit of price difference.

Psychological Pricing

If you have ever entered a discount store, you have experienced psychological pricing. This strategy involves using human psychology principles to drive sales up. A popular tactic is charm pricing; this is when the price of a product ends with 9, 99, 95, 98, or 99 to make it look cheaper than it is. This tactic works because when customers read from left to right, the number seems smaller. A

Another psychological pricing tactic is referred to as price anchoring. This tactic works by fixing the price high then offering a lower cost to make the price look like a fantastic deal. For example, “$200NOW$150“. If customers in the target market are drawn to discounts and sales, this pricing strategy will be a good fit for you.

Manufactured Suggested Retail Pricing

The manufacturer recommends a retail price to the seller in this pricing strategy. Manufacturers first started using pricing strategies to help regulate different prices of products across several locations. Most retailers use this pricing method with regular products such as home appliances and consumer electronics.

Multiple Pricing Strategy

You have most likely seen an example of this pricing strategy at the grocery store, but it is pretty famous for apparel as well, especially for underwear, t-shirts, and socks. With this pricing method, retailers sell multiple products for a single price. This strategy is common among retailers trying to create a higher recognized value for a lower cost, which will lead to an increase in sales. Another significant advantage of this strategy is that you can sell products separately for more profit.

Premium Pricing Strategy

This pricing strategy involves the retailers setting a high price to increase how the product is perceived. It is also commonly referred to as luxury or prestige pricing. This pricing method is used majorly by luxury brands in the hospitality and fashion industry.

Loss Leading Pricing

This pricing strategy involves increasing the average transaction value. Most of us have practiced this unknowingly, remember that time you walked into a store after being promised a massive discount, but instead of walking away with just that product, you end up buying several other items as well. With this brilliant strategy, retailers lure customers with a specific discounted product and encourage them to purchase other items. This tactic effectively makes customers buy several items in a single transaction and has been known to boost overall sales per customer.

Economy Pricing

In this pricing method, the price of your product is controlled by the sales volume. It is commonly used for commodity goods such as drugs or groceries, where the company does not have a significant brand to help with its marketing. This tactic relies on selling many products to new customers regularly. This is one of the most straightforward pricing strategies to implement.

Price Skimming Pricing Strategy

This pricing strategy is when the retailer changes the highest initial price that customers will pay, then decreases it over time. As demand from the first set of customers is met and more competitors come into the market, this strategy lowers the price to lure a new group of customers. This tactic aims to increase revenue while competition is low and demand is high.

Endnote

There you have it! Above are some pricing strategies that can help boost your dropshipping sales. As a dropshipping business owner, having the right pricing strategy is crucial. With the right cost, you can increase sales and make more profit from your dropshipping business.

In case you will like to know more about dropshipping or other services we offer, contact us today at Fulfillman. Our dedicated team will be available to speak with you. We will provide suitable answers to your questions and concerns. An amazing experience awaits you.


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Dropshipping is an effective method used to manage your online store. This is so because the process means that you get suppliers that will handle your order just the way you want it. The problem that people used to encounter when dropshipping has to be the pricing. Your ability to understand the right price to attach to dropshipping product at any time will ensure that you can always run a successful and profitable online business.

Pricing and its Importance 

One may wonder why pricing is crucial to the whole dropshipping process, and the reasons are not far-fetched because before deciding on the final price, you have to consider its total costs. The total costs include the amount you bought the goods and the shipping costs and taxation on the product. Making all these considerations will ensure that you sell your products at an excellent profit.

Setting the price too low will prevent you from making enough profit to be considered a reasonable income. If the price is too high, it will discourage customers from patronizing you, and you will miss out on some crucial sales. Therefore, it’s good to find a balance that any buyer would consider fair enough to choose.

Pricing is also one of the major factors that enable you to compete with other merchants. Sellers may deem your products to be substandard and will always hesitate to buy from you despite looking for a good price. Therefore choosing a very high price will drive potential customers to another seller of the same product. Choosing a lower price than the standard required is also not good as it will reduce the value of your brand.

How to Set the Prices of your Products

Here are some tips to set the right prices for your dropshipping products:

Choose a Minimum Retail Price

Before you do any other thing, you need to select a minimum price for all your products. The price must cover the total expenses that you’ve made on them, such as shipping, advertising, taxes, and other expenses. Setting this price limit ensures that you do not make any mistake in settling for a befitting price for your products and not to run into losses of any kind.

Once you’ve mastered how you can determine your minimum base price, you can draw a line on the lowest price range you can set for a product. From there, you can flex your prices as much as you want, knowing fully well that your costs have been well covered, and you will not experience a loss when you sell. This is where dynamic pricing can work in your favor.

 Get a Good Grasp of Your Market

Understanding the marketplace that you wish to sell your products is very important. This is perhaps as crucial as the pricing because even if you set your price, you still need a target audience that will buy. For instance, caffeine and coffee products will sell much in a business area than in any other place, and umbrellas will sell much during the fall and winter. When you understand your market and how the season impacts their choice, you can finally adjust your pricing to a level that will ensure massive profits for the season.

Know Your Competition

The Permutation that comes with pricing can be made easier if you can observe your competitors and note how much they sell for similar products. It enables you to determine the market value for your product, enabling you to distinguish yourself from their rates. If they have similar prices for similar products, it will be advisable that you change yours to attract more potential customers. To start, you can choose a lower price than your competitors.

Studying other people’s online businesses will help you understand potential buyers of your products and how they perceive the price of products. You can get valuable information from the web about any platform that you want to observe.

Know Your Target Audience

Your target audience is the people that can potentially consider buying your products. You need to study them closely and know their location, interests, their social class, and so much other relevant information. This helps you in deciding on prices that will bring enough patronage to your business.

You have put yourself in their shoes and ask what type of product they like when they like them, the price they would prefer for the products, the number of products they need, and the highest price limit they can offer. This will help you with a price limit that can work so that your profit margin will be constantly substantial.

Understand How Potential Customers Perceive Your Products

Before you set off to decide on a price for your product, you need to research the market to know how potential buyers value that particular product. Most of the time, people’s valuation of your product may be higher than the total cost price. This means that people will surely buy your product even if you raise the price because they value it more.

The scarcity of the product you have to sell is one of the best ways to raise its value. Therefore, when a product is scarce or has very little competition, you can choose higher prices without losing customers and making a good profit.

In Conclusion

Setting prices for dropshipping is a very delicate process that you do not need to rush to do. An excellent strategy will put you on the right path to establishing a successful e-commerce business that will bring constant profit.

Contact us today at Fulfillman to know more about our services. We specialize in providing excellent Drop Shipping services, Warehouse fulfillment, China sourcing, Third Party Logistics, and so forth. Our dedicated experts will be available to speak with you and discuss the options available to you. We guarantee you get quality and excellent services that gives 100% client satisfaction.