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What are some good tactics for selling quality over price?

We are innovators and focus on premium experiences for our customers. We're working with an innovative textile technology in a very well designed product that will have some premium features and last much longer than what is currently on the market.

A similar product just came on the market that is very cheap. So cheap in fact, I feel it may harm the perceived market value. They are definitely taking a loss on producing this product to bring it out sacrificing design and selling under market value. I am hoping this doesn't set the standard acceptance for cheap, janky, electronics in our industry.

People have asked us if we made the cheap product in question, which we did not. By sharing the product it means they associate what we do with that product. This is an insult to me as a designer, but good to know for business strategy.

We are working on a video that will help show how lovely our product is to touch, wear, and experience, setting up a pre-sale campaign, and putting our energy into how to bring this product to market.

As we do this, we are wondering what are some tactics and examples for selling quality over price. If you've worked in a boot-strapped startup and done premium product, I'd love to hear your input, with links to articles on pricing and marketing strategy as well.

15 Replies

Alison Lewis
1
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Alison Lewis Entrepreneur • Advisor
CEO/Creative Director
Just as I wrote this, I found this article: https://www.helpscout.net/blog/pricing-strategies.
Amy Golden
2
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Amy Golden Advisor
Vice President, Development - Strategic Services at World Wildlife Fund
Take a page from the luxury fashion business. Go to websites for the classic European brands, Gucci, Hermes, Liberty of London, etc. They will emphasize authenticity, craftsmanship, materials and purchasing experience. You can do the same thing. There will always be imitators. You have to articulate (on your website and all of your printed materials and verbal pitches) your brand positioning and unique value proposition and stick with it, with confidence.
https://www.gucci.com/us/en/st/about-gucci
http://www.liberty.co.uk/fcp/content/about-liberty/newsarchive

Good luck!
Sherry Shaffer
4
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Sherry Shaffer Entrepreneur
Agency Marketing Manager at Lindsay, Stone & Briggs
Superior product qualities make up only a part of what you want to convey to your customers. You absolutely also must figure out a way to connect emotionally with your target. Think about products you buy regardless of price. It's not just because you think it a superior product, it's because it fulfills an emotional need. Do some serious market research to see what, exactly, your product does for your customers--or what it can do. Better than the cheap version isn't the right answer. Listing out advantages is boring--hit them with an emotional connection that will make them love your brand. Not knowing your product, I couldn't make a guess as to what the answer is. But here are a few examples of brands that may or may not be superior, but provide the customer with an emotional fulfillment: Harley-Davidson - Rebellious, tough, edgy Nike - Heroic, athletic, achieving Victoria's Secret - Sexy, naughty, feminine Kashi - Wholesome, healthy, nurturing Apple - Smart, tech advanced, user-friendly Every single one of the above brands are famous and doing pretty well, but they're not necessarily the best out there. And they're brands that people will often buy full price--they don't wait for sales.
Neil Licht - HereWeAre
1
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Want To find-close Business Online without competition Before They Google Search? We solve this problem 1(508)-481-8567
Dontdo this video yet. Assumingyou know what your target audience wants and then Pitching it doesn't mean that you assumed correctly, that you can connect with your target audiences and get them to care about your offering nor does it actually create need or createsales opportunities.

Instead I'd suggest going this path:

  • First research the issues and their impact facing your ideal prospects
  • Then based on what you find, assessfor real if what you offer, because of what it does, is actually widely desired and can undo the issue and impact and result in faster production, overall less total cost of operation
  • Believe whatever you find your specific target audiences are telling you theycare and worry about, not what you think they worry about and WHY they actually would care re what you are offering
  • Be real on if they would spend cash to resolve their stared issues v what they currently spend and if they see the ROI as worth the expense
  • Then, in your video, start off with restatingwhat the ideal target audiences say they face in a process, issue, etc that they want to overcome and next focuson showing how you can stop those issues and worries cold along with restating the issues and the impact of adopting your solution.
Remember, people do things for their reason's not your and that has nothing to do with you telling them why they need what you sell. Focus your video on the issues you now know for sure are real that the target audiences face that they want to address and then show point by point how you and your product make those issues non-issues.

That has nothing to do withprice at all but instead with acknowledged value points that your target audiencehas told you it cares about and then positions you as the solution to what are now known and genuine issues that your target audiences must resolve.

That will connect, get a "hey that'sme!, I need to talk with these folks now" result, gain the opportunity to get calls and or go and sell and of course, get to a yes re buying.

BTW, you dont know if that competitor is losing money because you don'tknow their costs norhow they make their product so dontassume its at a loss.
Alison Lewis
1
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Alison Lewis Entrepreneur • Advisor
CEO/Creative Director
We are on it: We've done a in-depth review and surveyed over 130 people. We've also sold 25 samples to customers and gotten feedback from them as well and seen how they use them.

As for this statement:
"you dont know if that competitor is losing money because you don't know their costs nor how they make their product so dont assume its at a loss."

I'd love to be proven wrong because it means an entire industry has changed their price point for certain hardware parts and it means it's opened up opportunity for the rest of us to bring costs down. We're talking 70% reduction in BOM cost (not COGS, BOM). If they did that, more power to them.So, I'm open to the possibility, but highly skeptical.
Michael Fruhling
0
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Michael Fruhling Entrepreneur
Founder/Owner BFS Innovations, Inc.
Position your product and its performance to your target audiencerelative to other high perceived value options that represent themselves as solutions for "jobs to be done". When you are able to showcase your product's relative performance, the focusthen becomes relative value versus price.
Shel Horowitz: Shel AT GreenAndProfitable com
1
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I help organizations thrive by building social transformation into your products, your services, and your marketing
Great question--and great responses! As a marketer who specializes in working with green and socially transformative companies, I face this question frequently.

You have a bit of a double-edged sword here. My first impulse was a "don't be fooled by crappy imitations" campaign--but that risks exposing your market to the idea that they can get it for a lot less. So instead, I'd focus on the value you deliver, the feel-good qualities, and absolutely the emotional connection that others have talked about. And you might target the demographic that likes to pay more (and brag about it).

Highlight the areas where yours is so demonstrably superior that you trivialize the other product in the prospect's mind. In my "Making Green Sexy" talk, I use these two message points to give people ideas about using comfort and luxury:

"The warmest and softest slippers you'll ever own, thanks to our special blend of all-natural fibers"
"This powerful shower makes you feel so good, you won't believe how little water you're using"
K. Alan Robbins
1
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K. Alan Robbins Entrepreneur
Head Moose at Moose WorldWide Digital
Being a software development vendor who strives to be heard among the shouting done by our competitors out of India we are very familiar with this challenge.

If you have a big budget, you can create an expensive web site, have professional video's made, hire expensive consultants.

What we did - very successfully - was to study our low priced shouting competitors and strive to do the exact opposite. Their marketing emails were full of facts, technologies, and wild claims about their staff, so I wrote friendly down to earth folksy emails. Their websites were very angular/square engineering with icons, our website is soft, with images of people working and collaborating together. They are overly serious, we are quirky and fun.

We're launching a new website today that takes us to the next level in this approach as it is how we are surviving, and growing in a very tough highly competitive market.

Good Luck to you.


Rill Hodari
0
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Rill Hodari Entrepreneur
Strategic Consumer Insights Leader
You said you surveyed 130 people I hope you did a conjoint study in which you simulated purchase choices (representing both competitive set and potential offerings) at various price points to understand which combination of features and benefits warranted a higher purchase price. This is the best method for conducting such an evaluation. Direct and uncombined questions on pricing and features don't mimic really how people make purchase decisions and evaluate trade-offs so they are too hypothetical and far from reality to have a real correlation to potential in-market behavior.

Also even if the product features are set in stone the purchase simulation of a conjoint study still gives guidance on tolerable price ranges, competitive benchmarking and what marketing tactics such as co-branding and other messaging can have an impact. A limitation of the conjoint method is that it cannot really evaluate the impact of different distribution channels in other words if placement in an high-end, exclusive environment may help support a higher price more than other marketing tactics. Although I think with virtual reality shopper exercises, that limitation might be eradicated.
Scott Taylor
0
0
Scott Taylor Entrepreneur
Sales & Marketing Director at Cloudia Assistant / Author: The Opportunity in Every Problem
We sell a CRM (Cloudai Assistant). Our competition is so saturated that I often make the joke "You can't throw a rock without hitting 3 of them." Still I make the claim that we are by far the best value of any CRM available for the Insurance industry... because we are. Now, there are free CRMs out there that insurance agents can use but they won't do what Cloudia Assistant does. I also often state, "We are at the professional level where people charge typically $70 to $300 per month and we are only $29.99. We know you can't get this level of professionalism, security and power less. If you want to trust your data to a free CRM there are plenty out there. Also, if you don't care about drip marketing, automated commission calculation, a quote engine and unlimited support and training with no other fees than $29.99 per month then you can also buy one of those $70 to $300 per month programs and you still won't have it. It's your choice, decide for yourself.

With such an approach, although we do absolutely no advertising, our user base has nearly doubled each year I have been here going on my third year.
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