How you price your product or service makes a big difference on what kind of business you build.  We discuss how to think about different pricing options and what kind of customers you will attract.

For example, do you want to be known as the low-cost leader, like Wal-Mart or know for quality and customer service like Nordstrom?  As the old saying goes, there are 3 components to a product or service: price, quality and speed. Pick any 2.  In other words, it’s tough to be all things to all people, so it’s important to focus on what you want to be and to whom.

The 5 (or 6) P’s of Marketing

Market positioning has a lot to do with how you’re perceived and what kinds of clients you attract. Positioning is related the 5 “P”s of the marketing mix, which are Product, Price, Place and Promotion ¹

Pricing is one of the other P’s worth mentioning here because it’s a common tactic for companies to just lower their prices to compete. However, that’s not always the best idea and may actually hurt your brand.

We discuss all this and more in the video below. ²

Related: The site membership has an entire course on pricing your product. You can subscribe here.

Timestamps:

0:30 – How do you want to be perceived?
1:00 – How does an Internationally renowned Photographer price his product
1:45 – Perceived value & discounting
2:40 – What is means when no one complains about your price & the Pareto Principle
3:45 – Fewer clients is good & scaling
4:20 – How lowering your price hurts you (a success story)
5:00 – Do you want to be Wal-mart?
5:50 – Case study on perception
6:40 – Bry and I fight about Apple
8:15 – Who do you want as clients?

Related:

Pricing & Positioning

Will anyone buy your new product?

1. Although there is some disagreement as to what the “official” P’s are. I don’t think it matters much. You get the idea.
2. Did that sound like an infomercial? But wait, there’s more! I hope not.