When you are mapping out your company’s marketing strategy one of the largest factors to predicting its success is the pricing model that you’ve committed to and ensuring that this pricing is sustainable and efficient for your brand. When your company is just starting out, pricing may fluctuate and change before you get it just right, but before you jump into the low price competition and create a marketing plan to reflect that, there are some things you must know.

It is very challenging to compete in the low price pool so you will need to analyze your business product or service to be sure it is even a real possibility for your brand. To do this you will need to focus on various things such as the buyer’s journey to purchase your product or service, your cost advantage over the competition, your ability to grow fast, your company culture and the ability to be efficient and consistent with the product quality.

Marketing Strategy and Pricing Strategy

Buyer’s Journey

The pricing strategy depends a lot on the way in which a consumer goes through the process of purchasing your product. If this process requires a long decision and research period then it will be more difficult for your company to be successful with a marketing strategy that solely focuses on low prices. The consumers need more information to help them make a decision, which is when native advertising or content marketing should be a key part of your marketing strategy. Certain examples that will require a long research and decision process are if your product has a very high price point, fixes a very critical problem, has a long contract or permanency, etc. If your consumer does not need much time or research to come to a decision then a low price strategy is a possibility for your brand and it’s marketing strategy must place a large focus on this.

Cost Advantage

This is when it is important to do extensive research on your competition, getting to know all of their prices and advantages over you. If the majority of your competition already has extremely sustainable low prices then the last thing you want to do is enter yourself into a price war. This only ends in one way – frustrated and without high profits. If your prices can compete with that of the competition, and you are able to sustain these prices long term then your marketing strategy needs to reflect this in every campaign. Focus your marketing messages on the biggest advantage that you have – your low price!

Grow Fast with Consistent Quality

If your company has decided on a low price strategy then it needs to be prepared to scale quickly and bring in a large quantity of customers. Once you start launching your marketing campaigns focused on low price then you need to be ready to move fast with precision and quality when the customers start buying. If you’re not ready to scale quickly while maintaining this consistent quality then it’s key to ensure your marketing doesn’t bring in more customers than you can handle. The results can be worse when you bring in too many clients than when you don’t bring in enough. This starts to build a reputation that your brand isn’t reliable, can’t satisfy customer needs and should not be trusted. The same result is produced if you don’t keep the quality bar high and consistent with each and every customer.

In today’s technology and social network driven society one unhappy customer can very swiftly turn a group of happy customers against you and lead prospects toward the competition’s doorstep. Don’t let this happen to you; plan for long-term production and growth before driving sales and marketing teams at full force.

Efficiency and Culture

This is one aspect of your company that you must be absolutely certain about before deciding on your pricing strategy. Every team needs to be efficient but a team with a low pricing model must be on a whole new level of efficiency both in terms of processes and cost. You need to ensure that your processes are extremely efficient and every cost that your company must take on is completely necessary and unable to be lowered. One of the best ways to make sure you are efficient with your costs is by being very tough, yet fair, with supplier terms and supplier prices. You also need to make sure that the production process is completely optimized and every employee is adding measurable value to the company.

You can keep track of your team’s added value by using a system that marks goals and then tracks all of the metrics related to these goals. Meet with your team at least once a week to go over the progress obtained and make sure each person has enough support to meet their goals and add value to the entire team and company. A low price model doesn’t have wiggle room when it comes to budget, you simply cannot let employees fall through the cracks and become inefficient or unproductive. In addition to setting measurable goals and continually following up there needs to a culture set in place that naturally enhances motivation and increases productivity. This can include, allowing for a work/life balance, fun activities to build the team spirit, group rewards for achieving goals, sharing of ideas and taking them into account, team retreats, etc.

When you’re putting together your marketing strategy, look to your pricing, make sure it is the perfect model for your company, and then make sure all of your marketing campaigns reflect this model. This article from Harvard Business Review helps to determine the possibilities of success with a low price model if you are unsure. If a low price model isn’t for you then native advertising and content marketing are two great ways to help educate your customers and guide them along the buyer’s journey to the final decision of purchasing with your company. On the other hand, if the low price model works best for your brand then marketing campaigns displaying the low prices are without a doubt the best route to success!