product pricing question

[The Infotainer]

I have found a genuine supplier of magic trick box sets

I found a magic shop selling these kits for $250 and the price wholesale is $36 plus postage to get it here (it is a fairly big box)

Personally I don't think it right to sell it for $250 there is a point where you draw the line and I think they crossed it about $100 ago

What are peoples thoughts on ethics if I was to take a screen shot of their price and put it on the product page where my price would be $125 or a lower amount to be decided and say your saving alot.

instead of saying your saving $125 show them the proof, I am a little unsure

Is it the nice thing to do? no of course not- but is ripping people who don't know any better a better choice- No I don't think so either- I don't like people being ripped off, and yes there is the argument charge what you want, charge what you think it's worth and some even say charge what you can get away with- I don't share that- I charge what I honestly think it is worth

I can see the sales angle 50% off the competitors retail price which is very good- but is it ethical (or legal) to show the customer on my website - competitors prices?

[Kathy Creaner]

Hi there

Price is what people are willing to pay. The important thing to realise when setting your price is that you have to decide what to charge. There are a number of factors to take into account, such as competitors' prices and your costs. If you have personal drivers such as "I don't want to rip people off" or "I want to make magic affordable" then they play a part in your decision too. Your competitors have made their own decisions about pricing, based on their own reasons and value systems. It doesn't matter why they chose the price. The fact is that you are competing with them for the sale and that price may be a factor in whether or not you win the competition for a particular customer's business.

If you are competing on price, then you may want your marketing to highlight that you have a cheaper price than your competitor. If you target a particular competitor by calling out their prices specifically, don't be surprised if they target you back. For example, you say "xyz charges $250." They change their price. Straight away, the accuracy of your website is called into question.

As for the ethics of showing competitor prices, that's a personal decision for you to make based on your value system. I'll leave the legality of doing it to the people who are qualified to know the answer.

Good luck with setting your price.

Kathy

[BranchingOut]

Originally Posted by The Infotainer

but is it ethical (or legal) to show the customer on my website - competitors prices?

I am not sure about the legality of it, but Bunnings does this on their brochures as you enter the store.

[themot]

I think it's a bit of a low act to do it to another small business, they have to make a profit somewhere. If it was Big W or something I would say go for it however.

[bluepenguin]

I think one of the dangers in doing this, is that you can end up focussing so much on what other people are doing and charging, that you can forgot about promoting the good things about your own business.

That said, it could really work for you.

If you're into adwords, you could try capturing some of that website's traffic with some sneaky keywords.

[Kathy Creaner]

Originally Posted by bluepenguin

I think one of the dangers in doing this, is that you can end up focussing so much on what other people are doing and charging, that you can forgot about promoting the good things about your own business.

Good point bluepenguin. I keep hearing variations of the following lately, "Price is what people pay. Value is what they get."

What's the value of your product? Will this box of magic tricks help the budding magician to become better at their craft? Can they get replacement parts if needed? Are the instructions easy to understand? If they lose the instructions, does your website provide a pdf copy of the instructions for download?

Promote the benefits of buying from you. Instead of discounting heavily, value add. Perhaps offer a $5 off coupon on next purchase of $50 (reward existing customers instead of attracting price-sensitive customers who won't return).

There's so much more to marketing your products than setting the price.

[AgentMail]

I understand that the snapshot would have more impact, but it sounds as though you have a conscience, and I don't think it would really sit well with you. Perhaps you can just make reference to it...

'Elsewhere $250 with Infotainer, just $149' or something like that. If I was the customer, I'd then be like 'Yeah right, bet it's not $250' then I'd go searching, and to my embarrassment, I would find you were in fact right, and buy from you anyway!

[victorng]

In general, price comparison is fine BUT ...

... it needs to be correct. That means you must constantly monitor your competitors' prices to ensure your ad is not misleading.

... you can name your competitor and even use their trade mark but be careful with screenshots of websites - may potentially run into copyright issues.

Cheers,
Victor

[Khalid Adam]

You seem to be basing your price on cost where as someone like me bases my price on value rendered.

i also base my price on experience - not just the core service. an experience with me is a paradigm shift for most and very few can offer something similar.

whilst i may charge at least double the industry standard, and therefore appear as a rip off to some, its' still only 20 % - 30 % of my mentors which makes it a bargain.

one man's fun... as the saying goes. since you are mentioning cost, it seems that you are not offering anything different and the experience, pre & post purchase support from you is exactly the same elsewhere.

if you position your service and product as a commodity, you will have no choice but to compete on price. you may even feel guilty about increasing your price or consider others who charge a higher price as rip offs.

how about charging $250 + free 2 X 15min coaching session valid for 12 months?

[The Infotainer]

thanks l for their comments

The price is based in part on how much it cost me to get it, but also what my expert eye believes it is worth

The instructions are on DVD in NTSC format which I will pull apart and recreate in PAL so I will have a back-up copy of the DVD instructions

side by side it is the exact product, exact packaging I want to achieve sales from this product but also a good will to my business for future birthday bookings