In ‘the Marketing Clinic’, we have been working our way through the ‘six Ps of marketing’, to be assured of an effective and successful marketing strategy. This week, we will look in further detail at the third ‘P’: Price

‘Price’ focuses on the cost of your product or service, which is an integral factor in your business strategy.

The price you set will impact on whether your product is viewed as competitive, offering value and also enabling you to maintain and increase your customer base.

But, it must also allow you to make a good profit. If feedback from customers is that the price of your product or service is just too high the chances are, it is.

So, how do you set the price?

  • You have to know how much it costs to get your product to a consumer including all costs, not just that of your raw materials.
  • This pricing also needs to cover overheads and provide a profit to cover your time and allow you to be able to reinvest in your business.
  • You will need to undertake some research to find out what your competition charges and what price consumers are willing to pay.
  • What is a just and reasonable price for the value of the product to your customer?
     
  • Jo Spencer heads up the Lake District branch of GAP PR and Marketing Ltd with colleague Polly Winder. Together, they help local businesses decide on the right marketing strategy for them – www.gapgb.com