Originally Posted by Dani
All of the above are correct.
You should charge that correct market value of your products. If you undervalue your products you are showing a lack of respect to yourself and your products.
More people might be able to buy them, but those people will probably receive less benefit from it beause they themselves value it less.
You would take a lot more care of a car that costs $50,000 than you would of one thats costs $500.
So by reducing your costs you aren't actually doing anyone any favours. The best thing a person can do for society is to become the best they can be, and fulfill as much of their potential as they can.
If you undervalue yourself and your products, you are reducing your own potential.
Plus you are reducing the potential of others by making it easier for them to aquire.
Exactly. My ex-wife is a dog trainer and she quickly found that she was charging too little and raised her prices for personal lessons. Not only does it make her more money, but clients take their lessons much more seriously when they're paying a premium for them. I've talked to others in similar service businesses that suggest her experience isn't unique.
The technical term for this is "perceived value". There's a lot that goes into pricing a product or service. It may seem strange, but with many products charging a higher price can be a very good strategy: for example, if I go to the liquor store to buy a bottle of wine I'd be very unlikely to buy one that cost less than $10. I know that there's a number of good wines that cost less than $10, but there's also this subconscious perception that a lower priced wine is for drinking while you sleep on a sidewalk heating grate. I'm also a cigar enthusiast and there's been several quality cigar brands that launched with lower than market average prices and they couldn't give them away even though they were very good. When they raised the prices a couple of dollars they started to fly off the shelves. IMO, it was a case where the market they were seeking had a predisposed opinion that a cigar costing under $3.00 a stick just couldn't be any good and they wouldn't even try it. Logic would suggest that if you sell a product of comparable quality at a lower price point to others in the market that the world will beat a path to your door but it just isn't always the case.