Pricing expectations in established markets

Sent by Jonathan Stark on August 23rd, 2019

People have pricing expectations for established products and services.

For example…

Paperback books are an established thing. They’ve been around for a long time. Therefore, I have an expected price range for paperback books.

For something like a new paperback book, I’d expect to spend maybe $10 at the low end and $20 at the high end.

Given these expectations, three things can happen pricing-wise when I walk into a book store and see a book I’m interested in:

So…

If you’re selling something in an established market, your buyers are probably going to have strong expectations about what your price should be.

Which means you’ve got three pricing strategies to consider:

Any of these strategies can work, but each implies a very different business and type of client relationship. Which one is right for you depends on several factors.

Yours,

—J