As affiliates we rarely have the opportunity to set pricing for the products we sell. However, many affiliates have other businesses such as ecommerce sites or informational products. One type of optimization I have made a lot of money with over time is pricing optimization, particularly using bulk pricing discounts.
Let’s say you are at a concert of your favorite band. You go over to the merchandise area and see 2 shirts you really like. They are priced at $25 per shirt. Most people are going to decide on one shirt or the other. If they buy, the merchandise booth will make $25.
Let’s re-set up the scenario.
Let’s say you are at a concert of your favorite band. You go over to the merchandise area and see 2 shirts you really like. There is a sign that says “All T-Shirts – 2 For $40.” The average consumer will now think differently. They may think, “I like 2 shirts and it’s only $40 bucks for 2 of them, I’ll get both!” or they may ask “How much is 1?” Either way, a much larger percentage of the consumers are going to end up dropping $40 at this T-Shirt booth then they would have with the $25 per shirt pricing. Trust me, i’ve tested this.
One little tweak in pricing can change something from profitable to super profitable.
The obvious question is how does this help online?
If you own a product and you control the pricing of it, I suggest trying 2 types of pricing structures:
- 2 For $xx
- Buy 2 Get 1 Free
These pricing structures work if product you are selling is a high margin/low cost item.
This one tweak can change your profit margins dramatically. Have you tried this?