Pricing your products or services effectively is a delicate balancing act—a critical aspect that can make or break the success of your business. Set the price too high, and you risk alienating potential customers; set it too low, and you might leave money on the table or even devalue your offering in the eyes of consumers. In the today’s dynamic business landscape, understanding how to navigate the intricacies of pricing is essential for sustainable growth and profitability.
Packaging your products or services to achieve the best price matters. With Mother’s Day just around the corner, we decided to tell the tale in a different way – and that is through the lens of Shirley Hollis, Partner at Xeinadin and mother of two boys.
Shirley has a wealth of experience working with business owners across most industry sectors. From start-ups to raising £millions in funding for expansion, Shirley has the knowledge, skills and drive to help you meet your goals.
Shirley enjoys scuba diving, abseiling and motorbike riding in her spare time and when she’s not so busy with work, family time or hobbies, she reminds us through funny snippets how sometimes business is…well, child’s play!
“For me, Mother’s Day is a time to reflect on all the amazing things that my children have achieved and the happiness they have brought to my life.
This year is no different as I was reminded of a time when my then 3-year-old perfectly demonstrated that sometimes business really is child’s play.
Some of the best businesses in the world know all about packaging their products to make them more attractive and encourage us to spend more. Take McDonald’s with their Meal Deals or Virgin Media, who have 6 packages (bundles) including ‘Big’, ‘Bigger Combo’ and ‘Biggest Combo’. On top of the monthly cost, you can add extras to your package for additional charges or upgrade, say from one package to another. It works very successfully for them so why don’t more businesses do it…. Is it really that hard?
I was putting my 3-year-old son, Daniel, to bed one night and, as usual, he collected his 3 favourite cuddly toys and snuggled down.
‘Do you want a teddy?’ he asked in a quiet voice.
‘Yes please’ I said, following our usual bed-time ritual.
‘Which one?’ he asked. So, I pointed to the one he normally gives me and replied, ‘That one.’
‘OK’ he replied and then his little hand went up in the air, palm facing upward, ‘Money please’ he said with a grin.
Well, knowing I had a coin in my pocket I took it out and placed it in his hand. He looked at the shiny 20 pence piece and put it in “The Till”. Imagine my surprise when his hand resumed its former position.
‘Wasn’t it enough?’ I asked.
‘No’ he replied.
‘But it’s all I have,’ I said.
To which he calmly and casually replied ‘OK.’
He picked up the teddy, held it in front of him and his hand went up to first one arm, then the other – with a twist of his wrist he said, ‘No arms.’ His hand then went up to teddy’s face and … twist! ‘No face.’
He then proudly handed teddy to me and said, ‘Here you are.’
(I must point out that no teddies were hurt during this incident.)
Some pricing gurus advise that the best price is one which both parties are happy with.
So, did Daniel and I achieve the best price for teddy? You bet!
Daniel was happy as he was 20 pence richer, and I was happy as I now had an ‘armless’ teddy who would never be able to give me dirty looks and, one very happy little boy.
What lessons can we learn from my 3-year-old?
- Cuddly toys – Package your products to make them appealing to your market.
- 3 different toys to choose from – Have 2-3 different level packages for different price ranges
or
- And most importantly, tailoring my choice – If your customer/client really can’t afford it don’t be afraid to negotiate. “
If you’d like to know more about effective pricing, pricing methodology or the dangers of selling cheap, why not download our Growth Through Pricing whitepaper below.
