In the previous article we have seen the importance of pricing your product accordingly in order to maximize your reach and conversion rate. But what if "price" is not the only factor that can heavily influence the purchasing decision process?
Indeed, price is one of the biggest factors that influence the purchasing decisions, however it is not the only one. There are at least five more reasons, each one with their own weight behind decision making, that can drive a potential customer into an actual purchase:
Need: The product or service has to be able to satisfy a need the customer has. A need is usually associated with the "lack of" something, and the product or service is there to basically fill in the gap.
Practicality: Is the product really applicable and does it solve a problem? Practicality may sound similar to "needs" however the distinction here is "Can the potential customer actually use it?"
Urgency: It is our job as marketers and sales people to create a sense of urgency around our product or services. Think of how many "limited edition" stuff are out there, yet there just happens to be enough for everyone!
Value: When a product or service directly appeals to certain pain points of the potential consumer, then that enables the consumer to see the value in relation to what they are about to purchase. If they can understand and see the value, then it is highly likely for a sale to happen.
Trust: If you can communicate effectively and create a bridge of trust between you and the potential customer, then pricing shouldn't be a factor in the purchasing decision. Customers tend to purchase from brands and people they trust.
As mentioned above, "Pricing" is merely but one of the factors that influence the purchasing decision process. In a lot of cases, people don't even consider pricing to be a determinant factor in the mix, simply because they have a great need for the product, or the urgency factor is there, or any other of the five factors mentioned above.
You can also think of this in terms of when customers walk away. Did you really loose the customer on price, or was it any of the other factors? Price is the easy way to justify loosing a potential customer, yet we understand that if every transaction was about price, none of us would have a €1000 smartphone, instead, we would still have our first €30 mobile phone. So think for yourself as a customer... what drove you to the €1000 smartphone?
I hope you have enjoyed this article. All comments are welcomed