Tech product pricing can be tricky, especially if you’ve never dealt with it before and have no guidance or tips.
So many businesses fail at tech product pricing.
They don’t do their research. They go off what they think the customer is willing to pay. Alternatively, they price their products too low and don’t make a profit.
Here are some product pricing tips that could help you succeed as an up-and-coming business in the tech industry.
Top 3 Tips to Price Tech Products Effectively
Stop competing on price and start competing on value. Anyone can win the pricing game, but not everyone can provide high-value products.
When you focus on delivering value, you’ll start charging more because your customers will see the worth in your offering.
Here’s an example.
Let’s say you own a tech company that sells software. You could price your software at $59/month and offer the basic features. Or, you could price your software at $199/month and offer twice the features, storage, and support.
Which one do you think your customers would rather pay for?
The answer is obvious. You’ll increase your sales by offering more value and increasing your prices.
2Know Your Market
Many tech product pricing tips you find online will tell you to price higher than your competition. However, it all comes down to your market.
- What’s their typical budget?
- How often will they use your product?
- How much does your product offer?
If you’re selling a tech product like others, you need to find a way to differentiate yourself. This could be by providing more value, better customer experience, or a lower price.
But if you don’t know your market, you won’t be able to find the right product pricing strategy.
3Test the Price
How will you know the price is right if you don’t test it?
Your pricing model may change over time. Adapt to your market’s behavior. Your tech will always be a work in progress.
Think of Apple. Every time they sell a new version of the iPhone, they increase the price because of the new features. They’ve tried and tested their pricing based on their market.
Pricing can be tricky, and you have to find the right balance between what you think the customer is willing to pay and what will make you a profit.
These tech product pricing tips will help you find that balance and boost your profits.
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