Pricing strategy and marketing. Part 3: Price and perceived value

I have seen so many artists and artisans break their hearts and finances over building their pricing strategies. I'd love it if I can save just one of you from living smaller than you need to. Why do I care? Because when you truly thrive, when you earn more than enough from your work, your work can only get better and better and the energy you put into it can only become clearer and more joyful. It's not about fleecing people for the highest possible price, it's about paying attention to how much energy (in every sense of the word) it takes to envision, develop, manufacture, and sell products you LOVE and taking 100% responsibility for replenishing and even increasing that energy through your relationships with the customers in your niche market.

Here are a few more notes on marketing and pricing strategy for specialty products.

They are marketing driven. Without marketing, how can we expect a customer to perceive the value we offer? It's not marketing to persuade, it's marketing to enlighten.
Specialty product companies are built around their customers. They have an exceptional commitment to providing value to people who want something other than the ordinary, and they are experts at matching real value with perceived value. You might say that they preach to the choir, and the choir loves it. And happy choirs attract new singers.
Specialty product companies' pricing strategies reflect the CUSTOMER-PERCEIVED VALUE, not the manufacturing cost. For example, artisans who make aromatic soaps and toiletries should not attempt to set prices on a par with mass-produced products. Their products are not inspired, designed, manufactured, or packaged the way mass produced products are, so why would they attempt to compete by setting a similar price? An artisan's pricing strategy needs to cover the cost of manufacture (including a healthy wage for the owner), beautiful and functional packaging, joyful and respectful presentation, and allow plenty of time and space for creativity, experimentation, and renewal. (That's called a vacation, by the way, a word that we who are self-employed sometimes forget entirely.)
Superb product and service performance is a constant pursuit. If your sales slip or you experience price resistance, it is a signal to change your marketing strategy so that it educates your customers and increases the perceived the value of your products. It may also signal that it is time for you to innovate or improve service.
Specialty product companies must consistently look for how their products can solve customer problems and how they can provide greater service. How well I remember feeling resentful and victimized by customer service concerns when I had my clothing business. How could I possibly afford to give the kind of individual support people seemed to want? The answer was, "How could I not?" There was no way to prosper unless I provided extraordinary service, and that meant building a pricing strategy that would allow me to spend whatever time was necessary on customer service. In this way, pricing and marketing strategies are intimately connected: I cannot effectively market something I cannot deliver, and I cannot consistently afford to deliver something unless I am charging enough for my time, costs, and creativity.

There is much more to developing a pricing strategy & marketing strategy that works, but beginning with the customer in mind will help you avoid under pricing. Higher prices are not necessarily the equivalent of gouging or "taking people for all you can get." Higher prices can be seen as a duty you owe to your best customers so that you can continue to deliver fabulous products.

AP- your self promotion and small business marketing resource

Learn more about Authentic Promotion - a comprehensive small business marketing resource that turns marketing and self promotion into a path of increasing self-awareness, authenticity, and right livelihood. In particular, the pricing strategies you learn to apply will build the solid foundation for your authentic prosperity as an entrepreneur.

As a business coach and small business marketing consultant, Molly Gordon, MCC, is available in Greater Seattle Area and internationally

Cast a fresh eye at your product pricing strategy and marketing - Part 3 Price and perceived value by Molly Gordon, MCC

Cast a fresh eye at your product pricing strategy and marketing - Part 3

Price and perceived value
by Molly Gordon, MCC