It is wise to do testing on the price of your item. I have been surprised a number of times at what a price change did for my sales. Sometimes, it was the exact opposite of what I "thought" would occur. So, don't allow your assumptions to stop you from changing the price. For instance, if you think that raising the price will automatically decrease your sales, that is not always the case. There is a certain type of customer, out there, which will actually be more likely to buy it if the price is higher! Yes, I have found that there are two types of customers: Those that like it cheap and those that like quality. The people that want quality often assume that if the price is higher it is better quality. To me, it doesn't seem logical, as I am other the "like it cheap" category usually. But, to them, it is logical to spend more money to obtain quality, whether or not it is really better quality. Another assumption I have made that was incorrect is that lowering the price too far is risky. If there is enough demand from the "like it cheap" crowd, you can lower the price and see a large increase in orders. I have seen this occur with one of my products.
When doing price testing, do it in a scientific way. What I mean be meticulous with your methodology and analyzation. So, try raising the price a couple dollars, let it go for a week or two and analyze your sales and profit. Did it increase or decrease? If it increased your profit, keep it. Possibly try increasing it a couple more dollars and let it work for a week or two to see if it increases the profit again. If it doesn't, go back to the previous level that was making the most money. If it does, maybe this is indicating a pattern or possibly, you need to increase it again.
NOW, this will mess up your thinking, but just because increasing the price made more profit, does not mean that there is a lower price also that can increase the profit. Think of those curves with two humps you used to see in math class. Imagine your first price was between those two humps and you just went to the right with your price increase and saw the profit go up (one of the humps). But, if you would have went the other way, you would have also seen a profit increase. You don't know that, though, as you haven't tried it yet. It should be noted that this "two hump curve" does not occur too often. Generally it is a one hump curve and if increasing the price increases your profit, most likely the opposite direction will decrease your profit.
The Importance of Having a PayPal Account
When selling on eBay, Yahoo and through Google Adwords, I receive payment generally in two different ways. The first methods would be through the mail (money order, checks, Bidpay.com money orders). This accounts for only about 15% of my revenue. The second and more important method is through my Paypal Account. Now, with classified ads, you will see most of your payments coming through the mail in the form of money orders or checks. But, it is always wise to have a PayPal account for those who goto your website, assuming you would provide this info in your classified ad or on your automated toll free phone number.
As mentioned earlier, it is wise to sign up with a company that provides you with a toll free number and automated call answering. The reason why is because your regular phone would be ringing off the hook otherwise. Unless you intend on selling something or higher value, it would be worth your time to get an automated toll free phone number.
The toll free phone number could be setup to have a menu with options. One of the options describing your various products in detail, such as describing its benefits to the customer enthusiastically. Another option would give detailed instructions on how to order the product. These two options would be most important and necessary for this to work. Other options could be added, like how to personally call you, how to send an email or fax, etc.
SOME TOLL FREE PHONE/AUTOMATION LINKS:
- Business.com - Business Toll Free Categories
- Vonage Broadband Phone - Toll Free Plus
- VirtualPBX Soho Service
- Teligent - Toll-Free Services
- FreedomVOICE Systems - Virtual Office/Voice Mail/Etc