Can’t figure out how to beat your lower-priced competitors? Don’t let predatory competitor pricing strategy destroy your business.
The answers below are provided by members of FounderSociety, an invitation-only organization comprised of ambitious startup founders and business owners.
There’s one thing a client will always privilege over low cost, and that is specialization. If a client has the choice between a cheap offer and an offer that is specifically geared towards them, they will choose the latter nine times out of 10. Find a way to tailor your product or service to sub-groups of customers. You can still hit the entire market by offering multiple tailored solutions for each sub-category.
Make your positioning on quality and your unique offerings. You may need to educate your customers on why you’re worth the extra money, but don’t be in a hurry to beat the other team on price. Racing to the bottom can hurt your company long-term. Hold your ground with respect to your competitor pricing strategy. Folks will respect you for it.
Just because you believe a competitor is lower quality, it may not be. The market determines quality, and if they like your competitor, that’s an opportunity for you to learn why. Perhaps you will understand a marketing angle they use or a feature that they leverage in a unique way that is driving customers toward them. Use your competition to learn more about your market, and pivot accordingly.
You’ve invested in your products. Your staff is top-notch. And, you’re ready to truly hit the market. But remember: Your brand’s most important client is itself. Craft a compelling story that truly builds brand equity amongst your customer base. Empathize with them. Understand them. Add value to them at all times. Never take them for granted. This is the story you want to share, and that should lead towards more flexible competitive pricing strategies.
At Kuli Kuli, we often have people ask us why they should pay more for our organic moringa powder when there are hundreds of people selling organic moringa powder online at a lower price point. We had to clearly describe our unique processing system and extremely high-quality standards to make it clear that not all moringa is created equal.
We perform SEO with a wider scope and greater depth. You have to prove that you’re better first in order to justify higher pricing than your competition. Then you can distinguish yourself with the right marketing and messaging. If you’re struggling to find a reason why you’re better, then you may need to revisit your business strategy and identify where you offer the most value.
At the end of the day, it’s all about delivering a better first impression than your competitors. When someone hits your site for the first time, give them exactly what they need and eliminate any distractions. If your competition uses text and images, create a whiteboard or animation video to explain the benefits of your product. Long story short, make it as simple as possible for your audience.
FounderSociety is an invitation-only organization comprised of ambitious founders and business owners.