by Ana Gotter July 22, 2022

The Ultimate Pricing Strategy Guide

As marketers, we can do a lot to help you sell more.

We can push out campaigns to nearly every corner of the internet, follow up with strong email sequences, and help you to build brand awareness for your business and products.

However, we can only do so much when the brand’s pricing is a little skewed. And ultimately, we can do very little when it’s a lot skewed.

Most businesses put a great deal of time and energy into pricing, but it still feels a little bit like a black box task. Do you know how to find the perfect price that will maximize profitability and sales? 

In this post, we’ll go over everything you need to know about pricing strategy, including different types of value offers and how to find the right price point for whatever it is that you’re selling. 

Why Pricing Matters So Much 

Your pricing will absolutely determine whether or not customers purchase.

And if they do purchase, it will determine who purchases, how often they purchase, and how many people purchase.

You need to be competitive with your pricing, or you’ll likely struggle to sell more compared to your competition. For example, if you’re selling a beach tent for $250 and there are many more cost-effective options from big-name brands for much cheaper, you may have trouble getting sales. 

At the same time, you literally cannot afford to underprice your products or services. Not only can it signal to some users that what you’re selling isn’t as high quality as other items on the marketplace, but it can also cost you massive amounts in both profit and scalability potential. 

And, of course, if you price so low that you aren’t able to profit after factoring in your overhead costs, you can run yourself out of business. 

3 Types of Value Pricing to Consider 

When you’re considering your pricing strategy, you don’t want to just pick a random competitor, look at their pricing, and go, “yup, that’s it; we’ll beat it by $5.” 

Customers pay a wide range of prices for a single product type for a number of different reasons, and that’s partially because what they value is different.

As a result, there are three core pricing strategy models:

  • Pricing for affordability. In this strategy, customers want the best deal they can find at the lowest price possible. Budget is a huge concern here. 
  • Pricing for product value. You aren’t charging budget prices; here, you’re setting pricing based on the perceived value of your product. Your marketing messaging will be focused around quality, more features, a better user experience, and pricing that matches. Customers who want good quality or have a specific pain point that isn’t budget will often look in this range.
  • Luxury or “boutique” pricing. This may also include custom pricing for certain items like wedding gowns or homemade furniture. These items are often overly priced, but they get away with the high price tag because they’re branded as luxury. You can’t convince me, for example, that a Hermes bag is really worth hundreds of thousands of dollars outside of the fact that it’s a luxury brand. 

What This Looks Like 

You can see the difference in the pricing strategies for most product searches on Google. 

Here’s an example for the search term “fiddle leaf fig.” 

You’ve got the budget-friendly option at $68. 

There’s a quality-focused option that stresses the product’s size for $152.99.

And then you have the luxury option at almost $1500. 

Ultimately, these will all likely have customers purchasing them. The $68 option will have many more sales than the $1500, but the $1500 option needs, in theory, fewer sales to scale the business. 

How to Find the Right Pricing for Your Products & Services 

The pressure is on to find the right pricing strategy and the right price for your products and services.

In order to do this successfully, you need a multi-step approach that’s full of research, strategy, and testing. 

Let’s go through the four core steps of finding the right pricing to get you started. 

1. Run a Cost Analysis 

This needs to be the first thing you do.

How much does it cost to offer what you’re selling? 

For physical products, this will include general overhead, marketing, shipping, raw materials, storage, and manufacturing costs. 

Service-based businesses also need to consider overhead like software used to complete the job and the amount of time it takes to offer their services. 

Make sure that you aren’t forgetting easily missed or “hidden” costs, like taxes that you have to pay later and credit card or bank fees. You’ll also want to account for items damaged in shipment or customer returns. 

Add up all these costs and determine how much it costs to create a single product, on average. Your pricing must be above that number in order to hit profitability. 

2. See What The Competition Offers 

Competitor research is a crucial part of any pricing strategy, and you’re going to really want to be thorough here.

Find your top competitors to see what they’re selling and for how much. A few quick Google searches can help you discover your core competitors. Make sure you’re looking at the following:

  • Search and Shopping Ad results to see brands that are pushing for more visibility right now
  • Organic search results 
  • Review posts from third parties that list different types of products (especially those that list products at different price points intentionally) 

First, your starting point will be compiling a list of direct competitors and seeing what they’re listing their products at. What are their standard prices for different products, and what features do they offer?

Winter coats are a great example. They come in such a wide range of prices because people have such different needs. 

Some are going to come with all the bells and whistles— extra down insulation, extra length, even battery-operated pockets to keep your hands warm. 

Others are going to be a standard parka meant for milder climates and more simple budgets. 

Make sure you’re comparing apples to apples here for a realistic gauge on the market.

And as you’re creating a list of price points, take note of the following:

  • What exactly do they have to offer that justifies their price point? 
  • What sale prices or special offers do they have, including intro offers for new customers? 

It’s important to find products or services that you’re sharing the same pricing strategy and general quality in order to get an accurate idea on what you can charge. And to see what’s really selling, look for products with a long list of reviews; that’s a good sign that their pricing may be in the right place and at least isn’t preventing customers from purchasing. 

3. Figure Out Your Niche 

You could have the exact same product as a competitor but theoretically sell it for more… as long as you figure out your niche.

Where exactly do you fit into the market, and where do you need to be to maintain profitability?

Keep in mind different audiences want different things. Knowing how to tap into that with the right marketing campaigns, branding, and messaging will impact how much you can afford to charge.

Cars are a great example.

I’m married, my husband and both have good jobs, and we have no children. We’ve got pretty solid disposable income. 

Despite that, I have no interest in flashy cars. I want a safe car, and I recently paid a decent MSRP for a 2022 CR-V, but I’ll drive it until the wheels fall off. I couldn’t be talked into any of the upgraded car packages or higher-trim models because I just wanted a reliable car that had updated safety features. 

I have another friend with similar income who trades in his car every few years. He wants the latest trend, so he wants a deal on more flashy cars that he’ll then work on for a few years with upgrades before he gets a new one. 

My friend and I belong to two completely different audience segments, even though we have similar incomes. Appealing to the right niche can make all the difference in telling you where your pricing should be, and it will be shaped by the consumer behavior of your target audience. 

4. Test Out Pricing & Get Feedback 

We test everything here at Disruptive Advertising, and we strongly recommend you test your pricing, too.

There are a few ways to do this.

You can get feedback from your community (including customers) before or after raising prices. Are they still willing to pay, and do they think it’s worth it? Having an explanation of the increased pricing can help.

You can also test out different prices and intro offers. Start with the price you think your product should be at, and then drop it through sales if it’s too high. See if sales increase accordingly.

And if your goods are selling like hot cakes, you can always test rolling out pricing increases, too. 

Final Thoughts: 3 Tips to Price Your Products & Services Well 

As you’re fine-tuning your pricing, we want to leave you with three tips to make sure that you’re where you need to be:

  • Always test out different intro offers, as this can have a major impact on initial first purchases; once customers purchase and are happy, they’re more likely to be willing to spend a bit more in the future
  • Tie pricing into your branding; it can reinforce your choice and make it easier to sell
  • Adapt as you need to, and always remember to notify customers of changes in pricing, really with reasoning, at least a month before it will impact them 

Pricing is never going to be a single static decision that you can make in a bubble. There’s a lot of research that goes into it, and as pricing in the market changes, your own pricing may need to reflect that to some extent.
Want to learn more about how to use marketing to sell more, charge higher prices, and maximize your profitability? Check out more posts on our blog here!

  • B2B

  • Brand Awareness

  • Business

  • Conversion Rate

  • Ecommerce

  • Google Ads

  • Marketing

  • PPC

  • Shopping

  • Strategy

Ana Gotter

Ana Gotter is a freelance writer specializing in social media and content marketing, though she writes on a variety of other niches and subjects. She can be contacted at

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