Many small business owners consider pricing some kind of dark voodoo that you can only get right with the appropriate incantations, or access to a pricing consultant who knows the right incantations. At risk of hurting my own business, I’m … Read More
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Price Increase through Reverse Volume Discount
It’s no secret that companies often change package sizes to mask or soften price increases. Coca Cola is going one step further, touting it’s 16oz bottles as “more for your buck” at $0.99. Want more soda? You can pony up … Read More
How did Netflix raise their prices 60%
Twitter is abuzz with the anguished cries of Netflix customers, many of whom will soon be paying $16 per month instead of $10 per month for movie rentals. Many others have angrily threatened to cancel their subscriptions. Instead of focusing … Read More
Real vs Perceived Value (Seafood Edition)
(Image source: Wikipedia) This is the unattractive and unattractively named Patagonian Toothfish. You probably haven’t seen it listed on too many menus. However, some chefs noticed that it cooks really nicely and tastes delicious. But how to get people to … Read More
To Groupon or Not to Groupon?
Groupon has taken the local deal market by storm, growing quickly to $2B in revenue (depending on how you define “revenue”). The local deals company has also created massive buzz and is now preparing for one of the largest IPOs … Read More
Real vs. Perceived Value
If your maximum price is determined by the perceived differential value of your offering, how do you know what value customers perceive. Many of them won’t tell you, especially if they think you’ll use that information to jack up the … Read More
3 Ways for Small Business to Price, Which Way is Right?
As a small business owner, you don’t have big pricing departments or teams of PhDs with fancy algorithms to set prices. Pricing is often the last thing you want to think about (we’ll talk about why this is a big … Read More
First step in running a profitable business: don’t be scared of making money
In my line of work, I encounter a lot of small business owners who set their prices by copying the “going price” in “the market” or by sticking their fingers in the wind. This is unfortunate, but fixable. What really … Read More
If you think you’re worth it, but can’t say it…
A lot of businesses think they have a great product or service. Something above and beyond what the competition offers. But when it comes time to put a price on all this awesomeness, they are still cheaper than the competition. … Read More
The Sorcerer’s Apprentice and the $23 Million Book
I’m a big fan of automating pricing tasks. Companies spend way too much time on mundane issues like moving pricing information from one system (or spreadsheet) to another, and far too little time really thinking strategically about price and value. … Read More