Pricing Strategies

Pricing is always a difficult decision. Often a price that is too low makes people perceive your program as being inconsequential and not worth the trouble of purchasing (for you or them). On the other hand, a price set too high can also be negative for your rate of payments. Generally, a good way to judge what you should charge is to evaluate what programs like yours are selling for. However, that is only a starting point ...

There are several other variables involved with pricing. Generally, individual customers are more price sensitive than business customers (within reason, of course). If you have a tool that can save an organization time or otherwise make them more efficient, you could probably charge $98 just as easy as $48 (that' just an example -- your own program may be worth more or less). The key thing to note is that with a business of any size at all, either price is likely inconsequential to their budget. If the difference between your program and one like it is in the neighborhood of $10-$100 and one has to spend several more hours downloading, installing, entering data, and generally learning to use a program, they've probably lost money worrying about such an inconsequential price difference. Granted, some people in businesses probably shop around for equivalent programs: try a lot of them, then, if all things are the same (same features and general ease-of-use), they go for the lower-priced item (though that might not even be true because some people sort of feel they "get what they pay for" in a psychological sense and may even perceive a higher-priced item as being better). However, I think most busy people will try a program and if it fits their needs and has a reasonable price, they'll buy it and get back to business. If that's true, an important thing is to offer all the features they want, and try to get them to evaluate your product first -- and a lot of business products may actually be underpriced. If you have the choice of lowering the price or adding features to generate more income, the later would probably be better (though admittedly harder) if other things are equal.

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