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Hello everyone. Welcome to this special training program of Learn Vern, where we are learning “How to sell effectively on E-Commerce?”
Well, Today’s topic is “Setting up the winning price for a product as per market and customer”.
So come let’s move ahead with today’s session and understand this in detail.
“Winning price for product”. I cleared this at the start of this session that “It is one of the most focused and crucial tasks because the product’s sale depends on it”. Well yes, the sale of the product depends on the pricing.
If you remember I previously told you about one more thing which is the marketing mix where I focused mainly on the price because suppose let’s say you go to a mall, someone is offering 10% off, while the others are offering 20% and 50% off. Now, where would you prefer to go? The answer is very obvious, the shop that is offering 50% off. Why? Because my budget is that much only or the 50%off is attracting me towards it. Well yes, such offers attract the customers. So, pricing has the strength to attract the consumer or the customer towards it.
Friends, in the supply chain, when the cycle starts back after the consumer’s demands to again the “supplier, manufacturer, distributor and retailer”, so after the consumer’s demands, you will see a lot of change in the supply chain.
Let me give you a good example of this. When you look at the history of Coca-Cola, you will notice that it was not sold in bottles before, but after the demands of the customers, they changed the whole strategy and supply and started selling in bottles. And today, It is one of the most profitable businesses in the world.
Well yes, friends. There are so many other profitable businesses where they focused on customers’ demands and made some changes in their supply chain. As a result, they are amongst the top businesses in the world.
Name any top 10 businesses in your city. (Repeat). You will notice that they have understood and fulfilled the customers’ demands very well and accordingly they changed their supply.
Well, friends, demand and supply are directly proportional to each other. Let’s understand it in this session.
Now here it is important for you to understand one thing which is “Maslow’s hierarchy of needs”. This is a very famous theory of human motivation. Friends, Maslow explained to us in the form of a pyramid structure that there are certain needs where human needs are divided into certain different levels.
One is “physiological needs” which include air, water, food, shelter, sleep, clothing, and reproduction”. Then “safety needs” like “personal security, employment, resources, health, and property”. Then “love and belongings”, “esteem”, and lastly “self-actualization”.
So, a human’s psychology, a human’s demand, and a human’s need change depending on the stage he is in. Which stage of need is the human in? If a person has already fulfilled the physiological needs, then his demands may rise to safety needs. Then the demand changes to love and belonging which further changes into esteem and lastly into self-actualization.
Yes, friends, this is the theory of human motivation which was given by “Maslow’s hierarchy of needs”. If you try to understand this, you will realize how human psychology, needs, and demands change as soon as they understand a new need. (Are you getting it?).
Well, all the profitable businesses understand this theory pretty well that as soon as the demand increases, they have to increase the supply too. Because “There is a relationship between the quantity of a commodity that producers wish to sell at previous prices to the quantity the consumers wish to buy”.
04:56
Yes, friends. There is a relationship between the two, where supply is directly proportional to demand. If you manage to balance this properly, then you can pitch the proper price of your product. And if your pitch is proper, then there is no doubt that you will also be able to run a profitable business. (Clear?).
Let me explain one more thing which is “How to analyze the demand?” Well, this is a concerning question. How can we analyze the demand? Sir, you told us to maintain the balance of demand and supply equally. But, how do I analyze the customer’s demand? Friends, I am going to share some good tips here. (Pay attention here).
First and foremost, start “asking your customers”. Yes, “Ask your customers”. “Engage with your customers and ask them for feedback”. Ask your customers to provide feedback on your website. You will have the customer’s contact info and e-mail id as well, so call them or text or mail them and ask them to fill up the customer satisfaction form. Please tell us how satisfied are you with our product or service. Or you can request them to provide a review on your website.
Yes, guys, you might have seen many E-Commerce websites such as “Amazon”, “Flipkart” etcetera. What do they do? They provide a service or a product and ask for your feedback. Was the delivery successful and pleasant? Have you got the same product that you ordered? How satisfied are you with this product or service?
There are many more questions that you can ask your customers. You can directly ask this question to your customer if they liked your product or service? Do tell us. How will you benefit? You will get an idea to analyze the customer’s demand. Then you will have a new task to “Sort the data”. Yes, you will get an idea of how to analyze and sort the data through which you can organize the data, analyze it and visualize that okay, this is the demand of the consumer that we have to fulfill. Or during delivery, the delivery guy did not wear the company’s attire or you can say that you should plan this service. With this at least you will get an idea. (I hope you are following)
“So, you have collected customer feedback”. Now what? Now, you have to analyze that data. After you analyze you will have to “Align the feedback data of product or service” to make your customer happy.
To make your customer happy, “A customer needs analysis, examines if your business is meeting customer’s needs, and shows opportunities to improve your product or service”.
Look, friends. When is the customer actually satisfied? They are satisfied when you listen to their complaints and act on them. What happens when you don’t take any action for the customer’s problem? Well, the customers might leave your site and prefer to go there where their demands are valued. As a result, you will suffer a great loss.
So, to keep your customer happy, you can provide some add-on services or free gifts. Sometimes you can offer a discount as well to impress more customers.
Let me give you a good example of this. This does not belong directly to E-commerce, but it is a very good example. Therefore, I want to share this with you.
There were 2 petrol pumps in the city. Both the petrol pumps were just a square block away from each other. Now, on 1 petrol pump, they were simply adding the fuel and sending the customer away. But on the 2nd petrol pump, they were providing a free car wash as well. They had a dedicated platform for washing where the customer goes to add the fuel into their car and they were getting a complimentary service of a car wash. Now you tell me. Where would you prefer to go? The one that is offering a complimentary car wash or the one that is offering normal petrol with no extra service.
The answer is very obvious again, you will prefer to go where you are getting some extra service. (Right?). In the same way, if you understand this example well, then you will surely succeed in keeping your customers happy. A happy customer will never leave you. Trust me when I say that the customer will never leave you if you understand the customer’s demand properly and supply accordingly. And managing the best price within the competition while keeping the customers demand in mind.
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If you manage to fulfill all these conditions then trust me when I say that you just did it. You have managed to win in the right way. If you have understood the product, the demand as well as the market, then you are ready to analyze the market and set the best price for your product. (I hope everything is clear till this point).
Come, let’s summarize this module.
We learned the importance of “Finding a primary competitor”. Well, this is a very important module where we will finalize the pricing and for that, it is important to find the competitor because after analyzing them we have to make some changes in our market.
Then we discussed the importance of “Understanding the market niche” through which we learned how to mold our price.
Then we explored the game of “demand” and “supply”. As the demand increases, the supply will also increase and when there is more demand, there will be more supply. So, our pricing is also affected by the demand and supply of a product.
And through that, we learned how we can “make a price plan”. We can give a tough challenge to all our competitors with a pricing plan and we can also gain a good profit.
If you have any queries or comments, click the discussion button below the video and post there. This way, you will be able to connect to fellow learners and discuss the course. Also, Our Team will try to solve your query.
So, see you in the next video with a new topic.
Thank you very much.
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