How did you decide to buy your last car? When the writer was young, she did not like skoda made cars at all as she had a reputation in the market that her product breaks down. He also rejected Volvo because of its middle aged, family friendly image. Such ideas show how important branding is, and if you want to make your business successful, then you also have to do branding very carefully. Many people think that a brand is called what people see in the contact of their business, such as the logo, design, look of the store or the uniform of the staff. But branding is much more than that. Business experts often liken branding to an ice-berg, only one part of it is visible on the top but a lot goes on inside. The logo and the customer’s uniform is the surface of your brand, under this surface many components work like customer service, customer reviews on social media, etc. If there is no connection between the things above the surface and below the surface, then your business will suffer. For example, if the slogan of a brand is “Feel safe with us” and its delivery driver is driving very poorly, then there will be a difference in the words and deeds of this business, which the potential customer will not like at all. Its branding is very weak.
In the age of social media, it becomes even more important that people engage with your brand positively. Earlier, a destitute customer could tell about your business to only 5 people. But today with the help of social media, if the experience of a customer is not good with you, then he can tell it to 5000 people. Base your branding on the core values you want your business to be recognized for. For example, if an artist and entrepreneur makes mosaics. She wants her product to be affordable and of high quality. The sooner she is able to identify these values, the sooner she will be able to brand her business. Once you have decided on what values you want to build a name for your business, whether it is an affordable luxury like Mosaic or a Volvo car that has become a liability for a family friend, you will become an authentic brand.
No matter how big is the reason behind starting your business, still you have to earn profit. One advantage of being in the 40s is that you will have some understanding of finance, even if you have handled the household budget. Yet for many entrepreneurs, deciding the price of the product is the most difficult phase of launching a business. The good thing is that if you think a little bit about your finances, it will last a long time. For example, if you use an effective phishing strategy, you will not charge more than your customers even if you make a profit. One such strategy that businesses use a lot is called cost plus pricing, first decide the price of a service and product on the basis of what is its basic cost to you, then add some percentage of your profit to it. . But before that, make sure that your price matches your industry as the price varies in each sector. For example, if you are opening a premium clothing store, then you will have to put a little extra percentage on it because at the end of the season, these clothes go out of fashion, and you have to sell the remaining clothes at a discount. If your markup i.e. percentage of profit is high, then your cost will be covered even if you sell clothes at a discount later.
The second option is competition pricing, this is a strategy in which you look at the prices of your competition and then try to keep your prices much lower than them. Competition pricing can be a good way, but when you are working on a lot of profit, then there is a need to be a little careful. It is very important to keep your prices under control, if you do not do this then you will not be able to earn even the slightest profit. Ask yourself the question whether you can have tight control over your finances, and if not, then you should not go for competition pricing.
And finally comes the value driven pricing strategy. Instead of matching the price of your competition, you justify your high price with your offerings like service and product quality. For example, a hair dresser might justify their high pricing by adding a head massager to every haircut. Value based pricing is very effective, especially when your added offer is cheap for you but desirable to the customers meaning they like it.