Brilliant Ways To Raise Product Price Without Losing Your Sales
So, you have established your ecommerce store. It’s been a while, your products are selling, you have got a great customer base and everything is going good. However, there is a huge dilemma, which are your thin profit margins. You want to increase your profit margin and thus want to raise product price, but the idea of losing customers and sales is getting on your nerves.
Let’s accept a fact that every entrepreneur has opened their online store to earn money and expand their business, except for some exceptions (like always). You want to expand your business and earn more money and the price rise is one way to do that. Deciding price rise includes many ramifications for your business, especially if you have huge competition. You might end up losing your sales or your customer might switch to some other vendor for a cheaper price for the same product.
So, confused what to do to increase profit margins and not losing your customer base? Other than swapping your pricing strategy between different models, you can raise product prices without jeopardizing with your customer based.
1) Timing Is Important
If you have decided to raise your product prices, then you need to choose the perfect timing. For example, deciding to increase prices during the festive season, when your competitors are offering huge discounts or increasing the price of off-season products takes you nowhere. Wait for the product demand to increase and sales season to end.
2) Raise Product Prices, Keeping Your Pricing Strategy In Mind
Keep your basic factors of your pricing strategy in mind, before you decide the amount/percentage of price hike. You cannot abruptly go for major price hikes, unless there is a big reason like major increase in the prices of major ingredient or raw material. In this case, you should come clean with your customers. Other than this, make sure that you go for a small price hike in stages so that the customer is least affected.
3) Reduce Volume Or Services Instead Of Price Rise
This is a clever way of raising product prices. You can change the volume of your product rather than raising the prices. Or, you can withdraw some of the benefits that you were offering on your products before like free or flat shipping, quick delivery, discounts, etc. This will automatically increase your profit margin.
4) Include Value Added Services
Play with customer’s psychology and increase your product price by adding some value added services like free gifts, free service or warranty, etc. You can also bundle up your products with less demand product or products with huge profit margin. This will surely appeal to your customer. They might ignore the price rise, go ahead and buy the product.
5) Offer Special Offers Or Timely Discounts
If you have deliberately increased your product prices, then make sure that you do something to compensate it. You can offer special discounts for bulk quantity, conditional discounts like a 20 % discount on buying products worth Rs. 2000 or 5% discount for paying through cards. You can also choose a particular time of the day to offer discounts like 15% off on products from 12 pm till 1 pm and much more.
No doubt, product price hike is a risky business. However, the above tricks can help you raise product prices without affecting your sales or customers. Raise the prices once and check out your customer’s feedback. It will give you an idea to decide your future price hikes.
Got any other points? Brag about it in the comments section below.