Price Your Merchandise Right

Is the Price Right?

Welcome, my fellow enterprising home décor reseller, to an invaluable lesson in business strategy and marketing. It all begins with a collection of rabbits. Not just any rabbits, but a carefully curated selection. Each one has a story to tell, a role to play in your business journey. So, why are we here? What can we learn from these rabbits?

It starts with a simple concept: Choice. When we venture into the marketplace, we often find ourselves drawn to multiple options. We say, “We want this, we want that, we want it all!” But hold on, don’t rush ahead just yet.

The first step is to consider Quantity. How many of each rabbit do you really want to sell? It’s a crucial question. Because it directly affects your bottom-line. As store owners, we must always keep a keen eye on that all-important Margin – the holy grail of profitability that fuels growth.

Now, let’s focus on another a game-changer: the Power of Positioning. You see, how you present your products can make all the difference in the world. It’s like a stage where each item has its role to play.

Imagine the three rabbits mentioned before. One, the humble resin rabbit, is your “value” rabbit – affordable, playful, and undeniably cute. It’s not a luxury item, but it has its charm.

Next, we have the middle-of-the-road rabbits. They’re the compromise between price and quality, appealing to a broader audience.

Lastly, we have the pièce de résistance, the luxury rabbit. It’s a bit pricier, but it oozes elegance and sophistication.

Here’s the Key Takeaway: most consumers, when presented with three choices, gravitate toward the one in the middle. It’s like it’s programmed into  our DNA or magnetic north. You can influence this choice by the price

 you set. Let’s throw some numbers into the mix. The “value” rabbit sits at a comfortable $20. The middle-of-the-road rabbits? Just a tad higher at $22 – not a significant jump, but enough to make a difference. Now, the luxury rabbit, it commands a respectable $30.

Here’s the magic trick: when you create a pricing structure like this, with a noticeable gap between the third price and the rest, consumers tend to choose the middle option. It’s like a psychological sweet spot.

So think trifecta when it comes to Quantity, Quality, and Pricing. Consider how many “value” rabbits, “middle-of-the-road” rabbits, and “luxury” rabbits you need to bring in.

In conclusion my fellow home décor aficionados always keep these lessons in mind: the Power of Choice, the Art of Positioning, and the Magic of Pricing. With a strategic approach, you can maximize your profits and guide your customers to make the decisions that boost your businesses bottom-line.

Now, the challenge: sit down with a latte and take a hard look at your current pricing structures to see whether you’re currently leveraging the upsell appropriately or leaving money on the table.