How To Sell High-Priced Products: 7 Effective Techniques ⭐
Selling a high-priced product can be challenging to most businesses, especially when there are cheaper counterparts around. Thus, oftentimes, when a business wants to sell expensive products, one of the questions they ask is, how to sell high-priced products?
The answer is — negotiate the price that you want for your products.
Quoting an author, Dr. Chester Karass, saying, “In business, you don’t get what you deserve, you get what you negotiate.”
We all know that high-priced items are judged by their looks, value, quality… And when customers are making decisions, there’s a lot of things going through their head. What’s more, customers have different motivations too.
In the end, when people don’t buy a product, they blame the price tag. However, such a reason would only mean that you need to rethink your selling tactics.
To sell high-priced products, focus on value instead of price. Price your products based on their value. No need to offer unnecessary discounts so that your customers don’t object to the price.
However, there are no quick tricks when it comes to selling high-end goods. Thus, in this article, we will discuss the right strategies that could dramatically improve your sales. We will share with you 7 top tips on how to sell high-priced products. Additionally, we will provide you with the challenges of selling expensive products, and of course, some ways on how to overcome them.
We believe that, if your product is priced correctly for what you offer, you don’t have to lower your price. Implementing the right approach to pricing is key to increasing your conversions for expensive products.
7 Effective Tactics on How to Sell High-Priced Products
Price might be the first thing you investigate if your product is not doing well on the market. Usually, though, it’s not the main reason why your goods don’t get off the store shelves.
Here are some clever ways on how to sell high-priced products to market without giving up on the price:
Be open-minded about your potential customers
Don’t assume that prospects are not going to buy expensive products. Remember, even the thriftiest people treat themselves every now and then.
Use the right approach and see how you can turn any potential customer into a profitable sale.
Provide the Benefits/Value of Your Product
People usually buy things that give them the most value. Therefore, list all of the benefits or value that your product offers. So that customers will know what they will get when they buy your product.
Make your customers aware of how much time, effort, and resources went in creating the item. The product becomes more than just an item when you tell your customers what makes it valuable.
Customers really don’t want to pay a high price; however, they also don’t want to give up value even more.
Do not offer discounts
If you’re selling premium products, steer clear from discounts. Why? You’re offering a high-priced product, so that price tag is there for some reason. Take note, products on sale usually have a cheaper vibe, even the high-stake ones.
Certainly, it’s inevitable to have low-cost competitors. For that reason, sales and discounts are some good ways to entice new customers and make the old ones happy. However, when a potential customer you just began negotiating with requests for a discount just because your rival did, do resist the temptation! You provide high-quality goods and the price tag justifies the worth of the product. Offering discounts just because your competition did undermines the quality of your high-priced product.
Nevertheless, if you still want to find some ways to make your customers happy, go ahead and give them a discount. Offer them, for example, free shipping. That’s just one way how to sell a high-priced product without decreasing its price tag. If there is no reason other than competition, provide a good reason then let your customers know about it.
Use product positioning strategy
Oftentimes, it’s hard to imagine how customers will receive your high-priced product once it’s out in the market. A product positioning strategy is planning for how people or your customers in the market will think of your product.
Take note, your product has a life of its own. The only product positioning that counts is the customer’s understanding of the product. Therefore, your high-priced product doesn’t get that position if a customer isn’t even thinking about it.
Using product positioning strategy will help you understand two things: “where your product is today” and “where it would be ideally”. Meaning, product positioning strategy will get your product position from A (where your product is today) to B (where it would be ideally).
Avoid odd pricing
Avoid odd pricing, use round prices instead. Odd pricing or using prices that end in 9 or 5, like, $4.99 instead of $5 make products seem cheaper. Though odd pricing is effective for some products, you might want to avoid it when it comes to selling high-priced products.
Rounded prices provide a feeling of luxury while prices ending with .99 give a sense of a cheaper deal. Notice luxury brands like Burberry, Prada, and Balenciaga, they stick to round pricing.
List products from the costliest to the least expensive (price anchoring)
The most effective strategy is listing your products in order — from the most expensive to the least expensive items. The reason is that when a customer sees the costliest item first, the next less expensive price options would not seem so bad to the customer. However, if you begin with the low-priced items and gradually show high-priced products, the customer will feel like your prices are very expensive by the time they reach the last price.
Offer upsells or add-on options
You can increase the total sale if you offer upsells or a number of add-on options (even when selling medium-range products).
Accessories, for example, are a no-brainer. Related products can yield additional profits.
The challenges of selling high-priced products (and how to overcome them)
For businesses that sell high-priced items worth hundreds of dollars or products priced at a daunting four-figures, companies have several obstacles to overcome before they can convince customers to buy an expensive item.
Brands face three major dilemmas when selling a high-priced product. Let’s discuss the three main challenges and some solutions that will make selling high-end products easier:
The dismay of a high price (sticker shock)
Most of the time, customers back away when they see a price that is beyond their normal comfort zone. For some shoppers, it is easy to let go of a product based on price alone. Most people will tell themselves upon seeing an expensive item: “I can’t afford it” or “It’s too expensive… it’s way beyond my budget.”
You’ll quickly lose customers’ interest and attention if you don’t have a strong, compelling offer. Therefore, brands should use selective and strategic discounting. Companies should not reduce prices in a manner that harms the integrity of their brand.
Customer acquisition costs are high
Many assume that more expensive products have higher margins that lead to better marketing budgets. Regretfully, competition in the luxury goods market is fierce and your competitors are well-prepared and will gladly spend more on direct marketing in order to get a larger market share.
What should you do? Well, invest a significant portion of your budget in building an engaged and viable audience. By doing so, it will bring out compounding results, compared to one-off transactions.
Smart techniques for cultivating a constantly growing audience involve content and email marketing. For example, Burberry (a luxury brand) leveraged user-generated content to turn frequent customers into active and vocal advocates. In the long-term, with real voices talking about your product, it will generate more ROI compared to the humble profit from a quick straight response conversion.
An unknown brand name
You need to over-communicate your product’s benefits, the unique advantages you offer and the business’ values in order to help customers justify the high price tag.
For some customers, seeing is believing (literally). The reason why videos of products work perfectly for e-commerce sites. For some, social proof may help boost your brand’s image. Thus, good customer reviews and feedback make appreciating your high-priced product a lot easier.
Finally, customers feel good when you offer guarantees for your products. For example, the availability of full refunds based on customer satisfaction. Also, total care product warranties provide customers peace of mind, as they are aware that they won’t be stuck with a faulty product and a hefty bill.
Selling high-priced products is all about trying what works and what doesn’t. Observe what other luxury brands are doing – for instance, how they price and use visuals in product descriptions. Maybe you’ll find something useful that you can also utilise in your product marketing.
Remember – selling and pricing techniques that work for a business that sells perfumes may not work for a business that sells home appliances. Same with the target market at play. The bottom line is, know who your customers are.
Prioritise on focusing on value, brand second. Some businesses think that the reputation of their brand merits a higher price tag. While it’s true that the reputation of your brand may hold power; however, when it comes to negotiations on price, the value that your brand offers to meet the explicit and implicit needs of your customer holds more power. When possible, ask potential customers the value they got from your product or are expecting to get from your product versus your rivals.
One of the most common questions we are asked is how to sell high-priced products when it looks like that the only thing that matters to your competition is a low price. However, your company’s success is based on your ability to prove to your counterpart that the value you provide to your product is worth the higher price.
Always have your customer in mind, therefore, experimenting is important. You’re launching expensive products and you do not know yet how your customers will react to them. Maybe they’ll love them – maybe they won’t. Maybe they will need a little bit of convincing to appreciate your products.
Selling is a cooperative endeavour where you help customers find the solution that will solve their problems/needs and make them happy.
Being more costly always helps, even if you’re just 2-3 per cent more expensive than your rival, it provides you with the upper hand. Thus, in some way, always make your products more expensive, even by a little bit.
- marketing strategy (7)
- Organisational Design (14)
- Pricing Capability (64)
- Pricing Career Advice (11)
- Pricing Recruitment (15)
- Pricing Strategy (47)
- Pricing Team Skills (11)
- Pricing Teams & Culture (15)
- Pricing Transformation (17)
- Revenue Model (6)
- Sales Effectiveness (8)
- Talent Management (6)
- Technical Pricing Skills (33)