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May 8, 2006 :: Volume 2, Issue 4
Next Issue: May 2007

How to Price Your Products and Services?

Posted by TimSlavin at November 1, 2005

"Even with retail sites, the lifetime value of a customer shouldn't be ignored. The additional sales you can make to existing customers may be significantly more valuable than the immediate additional sales.

In these two tests, we have seen that intuition cannot be relied upon to predict optimal pricing. Sometimes a higher price creates more revenue, while other times a lower price will generate not only more immediate sales, but more recurring revenue as well.

We have provided a downloadable spreadsheet tool that helps you calculate your revenue and profit for a number of price points..."

From Marketing Experiments Journal. Articles about how to price your products and services tend to be rare and, worse, tend to toss you back to what you learned in your Economics 101 class in college. This article is a good overview of the issues and how to approach the process of fixing an ideal price.

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