One of the toughest things internet marketers face is to pick the right price for a product. If your price is too low, you’ll be losing money. If you set the price too high, no one will buy. Setting the right price is very important for any business.

Daniel Levis says in his newsletter that price is when you and your customer both make the maximum profit. When a customer sees the price, he automatically determines the price of the product. It’s called the perceived value. That bar between the offered price and the perceived value of the product in customer’s mind is his profit.

The higher the perceived value of the product, the more chances there are that they’ll buy your product. If you manage to set high price, yet offer double, triple that or maybe even 10 times more in quality bonuses to your customer, you can expect some great sales and great profits.

The better the product you have, the more money you can ask for it. If your product or service offers tons more features than the rest of the competitors, you can set much higher price. But again, not too high, cause if you overprice it, you won’t get any sales.

How to Set the Right Price?

• Asking
  One of the ways is to ask. I’ve seen when marketers simply send a message to their list and say something like: “Hey dude, how much you’d be willing to pay if I offered you that kind of product?” And then they give several prices, $29, $49, $69, $99, or over $100. One thing here is that some might simply click on the lowest price. Others might actually think about it and honestly say that they’d be willing to pay no more than $99. Others might push the price as high as possible so less people could get their fingers on that “super duper product”. Not sure how this works, but it’s worth trying.

• Testing
  Another, very widely used method is to test. Simply do a split testing. If the mailing list software allows that, you can send each other email with a different offer. Like prospect A gets – 1, B – 2, C -1, D -2, and so on… When you try different prices, you simply know what works. Lower price will bring more customers. Higher price will bring less, but the profit can be much higher. Sometimes even when you increase the price from $69 to $149, you’ll see no reduction in sales. If you don’t test, you never know what works. You might be leaving money on the table for years. Don’t let that happen. Always test.

• Guess
  That’s the most stupid method ever, yet so many entrepreneurs do that. I mean offline world too. Some are so dumb as not to even look what are the prices on the market for similar products. Guessing is a surefire way to failure. Never allow yourself to guess. Research, ask, test, but never guess.

Hi there,

Thanx for stopping by.

I’ve finally decided to install a blog. Boy, this was a 3-day pain in the ass… I’m no big techie guy. I can’t script or anything, just a little HTML. So going through all these WP files (especially CSS) was quite tough for me.

As you’ve noticed, I’ve changed the design of the whole site. Yes, you’re right. It looks like Adwords page now. Well, shame on me But if I like some design idea or example and I’m passionate about it, then nothing can stop me. Well, maybe except lawsuits for copycatting

You know, I also wanted this blog to look just like the website and not another Kubrick theme, so I spend quite some time tweaking various tiny classes and DIV’s until I’ve managed to make it look like I wanted to. One problem though, on Opera or Firefox it looks quite crappy. I’ve tried changing one CSS class, but then in IE it looked even worse. I’ll just leave it like that… Sorry FF & Opera fans

Anyway… A little about this blog.

I’ll post here some information whenever I have time. So this isn’t regular blog… However, I’ll try to put here some valuable info about web marketing and other related areas, such as website design or RSS. I think these are also important. I’ll give you some tips and even links to some great looking websites, so you could distinguish bad design from good one (some people can’t even do that…). I’m also planning to start offering some web design (not programming) services in the near future. If you’re interested, let me know

And of course, I’ll share some tips here about things that work (and don’t work) for me in web marketing. You can come here from time to time and check the updated info here. You can also bookmark this page or subscribe via RSS reader.

And one more thing…

If you have some internet marketing related questions, don’t hesitate to ask. If I’ll be able to answer them, I’ll post them on this blog so others could benefit.

Ok, that’s all for today.

Take care,
Monty Lee