Multiple factors will influence how much you ultimately charge for your local business's products and services.
However, your competition can certainly point you in the right direction.
That is to say, you can learn a lot from your competitors when pricing your offers.
With this in mind, in this post, we'll cover some essential information you can learn from your competition and how it can help you choose the right pricing strategy for your local business.
Ready?
Let's get started.
How Much Are Your Competitors Currently Charging?
To begin with, how much are your competitors charging for similar offers?
Above all, comparing your pricing with at least three competitors will give you the best idea of the average price your product sells for in the marketplace.
Yet, avoid looking at the overall price exclusively.
Instead, you should also determine the relative value that consumers receive for the purchase price.
How similar are competing products to yours?
Do they offer the same features and benefits?
Considering the above, while you shouldn't solely use your competitors' pricing to determine how much you should charge, it can help narrow down an appropriate figure.
Additionally, pay attention to any product discounts or tiered pricing models they might include.
Correspondingly, you can see whether they are employing any new pricing models that you haven't considered.
Above all, how can you use the answers to the questions above to gain a competitive advantage?
What Are They Not Offering?
Looking at what your competitors aren't offering can allow you to capitalize on any gaps in their offers.
Accordingly, you can charge a higher price for your products and services if you deliver what they don't.
With the above in mind, you can look at competitor reviews if you're struggling to determine gaps in their offers.
Notably, customers often include recommendations for improvements when reviewing businesses.
So, see what customers aren't getting from your competitors and use this to gain a competitive advantage.
Look at Their Advertising Campaigns
To the extent possible, look at any paid advertising campaigns your competitors run and evaluate their effectiveness.
By all means, understanding how much they are spending and the type of ads and copy they use in their paid traffic campaigns will give you an idea of how much you should spend and the types of creatives you can employ to achieve similar results.
In Conclusion
As shown above, studying your competitors can provide valuable insights into pricing your offers.
Again, you shouldn't simply focus on offering a lower price than them.
Instead, you can reference their pricing structure when setting your own.
Above all, when done correctly, fine-tuning your competitive pricing strategies can significantly drive sales that push your business ahead of the competition.
Hope this helps,
Erik
We implement creative, results-based digital and hybrid marketing strategies for local business clients.
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