Sometimes we come across clients who are flogging a dead horse when it comes to marketing their products. This is particularly true in retail environments where prices can fluctuate dramatically over time. One minute all can be well and you can be selling a lot of product, the next sales just stop dead. Usually this is when a competitor has entered the market with a much keener price than yours – often Amazon!
You’ve probably seen plenty of Ads where people are trying to sell things at a significantly higher price than someone else. This is sometimes a sign of lazy marketing but can be due to differences in the product itself that are not obviously clear.
Trying to sell the same product at too high a price is a waste of time and a waste of your marketing budget. Despite this, some clients can delude themselves into thinking that they can still make money by selling their products at a higher price than the competition. (Often driven by the fact that they cannot actually sell it any cheaper due to their margins.) In these cases they carry on marketing in the vain hope that things will change without making changes to their offer that could change the dynamics of the sale. For example, by including a simple value added service with the product that might encourage customers to buy at the higher price.
There is no easy answer to the scenario where the price differential is just too great though sometimes a tighter marketing campaign can improve sales in particular circumstances. E.g. where location, speed of delivery or multi-buy discounts are a factor.
Where clients have a wide range of products in a fluctuating market, it can be very difficult to keep track of competitors prices. Reviewing your pricing on a regular basis and pausing your advertising where it is ineffective is one solution but that takes significant attention to detail and so is time consuming. Some products price changes can also be easily missed. A technical solution to this problem is to semi-automate or fully-automate the detection of price fluctuations and adjust your advertising accordingly.
It’s a similar situation when you are selling a service rather than a product. If you’ve seen your market decline over the years it may just be the hard reality that your service is now over priced in the marketplace. If you are lucky the problem may simply be that you are not conveying the true benefits of your service and distinguishing it from the competitions offer which may have hidden limitations.
In short, don’t be tempted to race to the bottom on price until you are 100% clear that your product or service represents good value for good reason.
Need some help resetting your marketing objectives for your product or service? Talk to us today.