Top 5 Pricing Policies Every Business Should Implement to Accelerate Brand Growth

It’s not easy to set the right price as it’s a managerial puzzle and it requires a lot of time and effort to get an idea about your customer’s willingness to pay for your product. Also, pricing policies directly impact your cash flow and profitability so don’t skip out on various policies when there are different pricing models in front of you to help you get the perfect pricing strategy. In this blog post, we are going to guide you on how can you accelerate your brand growth by implementing the top 5 policies for pricing strategies. Read on!

1. Skimming Pricing Policy:

This pricing policy is all about changing the product prices gradually after some time by considering the other competitor's prices. In the beginning, you can set your prices higher which leads to subsequent reductions when there is higher competition in the market. With this policy, earlier purchasers could benefit from the lower prices until the prices become high in the future.

2. Market Penetration Pricing Policy:

With this pricing policy, you can easily make a good customer base in the competitive marketplace initially. You can offer lower prices as compared to your competitors to get customers' attention so that they could prefer your brand rather than your competitors. Normally, businesses increase their prices when they realise that their product has become a top-selling product in the market. For this policy, you have to spend huge capital which provides you enough flexibility to bear the initial losses just because of the lower prices.

3. Premium Pricing Policy:

Premium and luxury products are usually packed in rigid boxes that give your customers a luxury appearance with unique packaging. These types of products can be purchased by a lesser number of customers who want to purchase luxury products at any cost without considering the price bracket. If you want to target such type of audience, you have to create a brand identity that resonates with your target audience's needs by adopting the premium pricing policy. In this type of pricing policy, there’s no need to worry about setting lower price brackets as your target audience is willing to buy expensive products also.

4. Economy Pricing Policy:

It is totally opposite of the premium pricing policy and the brands that opt for economy pricing policy usually opt for affordable and cost-effective packaging solutions like custom kraft boxes. In this pricing policy, you have to consider your target audience's needs earlier before setting the final price as your target audience wants to save money by purchasing affordable products. Costco and Walmart are the top leading examples that follow the economy pricing policy.

5. Bundle Pricing:

In this type of pricing, you can pair various products in one bundle and sell the whole bundle at lower prices rather than selling them individually at higher prices. By doing so, you can sell your products in less time and you will get higher profits within no time. With this pricing, different businesses get the benefit of skyrocketing their sales and getting a competitive advantage over their competitors. Also, this would help you mitigate the overall business risks.

Final Words:

The right pricing policies not only help you set the right prices for your product but also help you get a competitive advantage over competitors. The factors that typically affect pricing consist of inclinations of the target audience, seasonal demands, and brand requirements. For example, if your target audience has a higher purchasing power, it indicates that you need to go for a premium pricing policy and if your target audience is those who want to save more, you need to go for an economy pricing model.