36 psychological tactics in marketing: How marketing psychology works?

36 psychological tactics in marketing: How marketing psychology works?

by | Dec 1, 2022

Business Tips

36 psychological tactics in marketing: How marketing psychology works?

December 01, 2022

Using psychological tactics in marketing

That companies are using psychological tactics in marketing to win over the audience and boost sales is nothing new. In fact, the use of marketing psychology became even more important in recent years. The globalisation and digitalisation have stiffened competition and the market is more saturated than ever. Hence, companies need to find an effective way to promote their products or services. In other words, having a few psychological marketing tricks up your sleeve makes the difference between thriving and surviving.

Although the term psychological tactics in marketing might sound scammy to some, it’s far from the truth. Marketers only found a way to turn the human brain configuration to their advantage. Leveraging the findings of psychological studies and researches is in no way unethical or immoral.

Curious about the power of marketing psychology ourselves, we embarked on a mission to discover the most effective psychological tactics in marketing. Thanks to more than thirty marketers who offered their insights, we were able to write this comprehensive article. 

Quickly jump to any tip:

 1. Loss aversion marketing

 2. Highlighted CTA as a marketing tool

 3. The power of FOMO

 4. Relative vs absolute terms

 5. On the same side of the table

 6. The Baader-Meinhof phenomenon

 7. Tangible offers with visuals

 8. Rhymes are memorable

 9. Everybody loves getting things for free

 10. Names open doors

 11. The Rule of 3 rules

 12. Price anchoring is king

 13. Creating a sense of urgency

 14. Negative superlatives are more effective

 15. Picture yourself 

 16. Playing with emotions

 17. Color marketing is for real

 18. What’s that smell?

 19. Clustering related functionalities or incentives

 20. Storytelling never gets old

 21. Illogical reasoning works like magic

 22. Discounted prices always work

 23. ELMR framework – what is it?

 24. Playful quizzes to spark up engagement

 25. The foot-in-the-door tactic is the perfect bait

 26. Offering unique value proposition

 27. Maintaining high standards to stand out

 28. The halo effect is a double-edged sword

 29. One-two punch to grab attention

 30. Social competition as a trigger

 31. Offline engagement to avoid the online noise

 32. Keeping up with the Joneses 

 33. The theory of three hawkers

 34. Eye movement and marketing 

 35. Playing with open cards

 36. Giving less choice brings more cash

Loss aversion marketing

If you’ve ever wondered, why on Earth, do companies offer free-trials then you have Nobel-winning psychologist and behavioral economist Daniel Kahneman and his colleagues, to thank. Their research back in 1990 showed that groups of people are more likely to take action when they have something to LOSE rather than to GAIN.

This is called Loss Aversion and therefore once companies such as Netflix offer you their premium service, for free, you become hooked! And as the days draw near towards the end of the trial, you become anxious to leave the platform. And finally, the deadline drives you to finally take out your credit card and become an active member.

Of course, loss aversion is more effective when the product that consumers are using, on a trial basis, actually provides them value. But this much is certain, that a big part of Netflix’s growth can be attributed to the Loss Aversion strategy.

Chris Brenchley, Co-Founder and CEO of Surehand

Incorporate emotive language into the content, to imply that the potential customer already owns the service. Emphasize the losses that the potential customer would incur if they do not take your offer. Offer your potential customers a free trial of your service.

Muhammad Ali Sangi, Digital Marketing Strategist at PureVPN

As the CEO of The Bottom Line Group, I lead a select group of consultants in reviewing current contracts and service statements to help clients save money. In our sales pitches, we always emphasize how a potential client will never learn how to achieve tax liability reductions and increase near-term cash flows when they don’t hire us. It’s because of the principle of loss aversion that makes them realize that our services are indeed needed, especially in this period when a global recession is putting companies’ finances down to the drain.

Michael Hammelburger, CEO at Expense Reduction Group

This may seem counterintuitive because we are always taught to paint a positive picture to our customers. However, psychologists have found that people will generally go to great lengths to avoid pain rather than pursuing pleasure. By highlighting some of the possible negative effects of not getting our product, you actually evoke a greater emotional response in your customers and this will increase your chance of a conversion.

Albert Lee, Founder of Home Living Lab

Highlighted Call-to-Action as a psychological marketing tool

The most effective yet simplest psychological marketing tip is working with CTAs.

A highlighted and bright CTA (Call-to-Action) button always work, so make sure to integrate highlighted CTAs on your website. Also, de-highlight other buttons like Add-to-Wishlist so that the main CTA stands out. Highlighting them, specifically with orange colour, increased my

click-through rate by almost double. People tend to be attracted to orange colour of CTAs more than any other.

Rameez Ghayas Usmani, Digital Marketing Executive at PureVPN 

The power of FOMO

I am a marketing consultant who works specifically with early-stage startups; supporting them in their positioning and go-to-market planning. The one physiological trick I’ve found best for driving early signs ups; is creating a sense of FOMO. 

The first step is to find your ‘lowest hanging fruit’; a subsect of your audience who will embrace being early adopters. Then by using highly targeted media and well-placed content; use ‘invite

only’ and ‘member-get-member’ tactics to draw them in. People love a sense of belonging and ownership; so inviting them to the party and asking for their input is a sure way to get a strong groundswell early on.

Laura Bell, Founder & Marketing Specialist at The Point Consultancy

Relative vs absolute terms

An important principle of psychology which is highly relevant to marketing is the concept of relative vs absolute terms. People tend to think of gains and losses in relative terms, that is as a percentage or other comparison to another figure.

For marketing, this all comes down to framing. People are more likely to view a deal as favorable if it is expressed in relative terms (25% off, 50% off and so on) rather than absolute terms ($25 off). So as part of your sales and marketing, it is best to express savings and other gains for the consumer as a percentage rather than the amount.

Furthermore, this also means that people will respond better to 50% off a smaller figure for example, rather than 30% off a larger figure, even if the dollar value is the same.

William Taylor, Senior Career Advisor at VelvetJobs

On the same side of the table

One of the psychological tactics in marketing I use is actually an in-person tactic: when meeting with a prospect, I’ll often sit on the same side of the table or perpendicular from them rather than across. This plays to the psychology “we’re on the same side” and allows people to put their guard down a little easier. From there, I gather more information on their real versus perceived needs.

Tanya Moush, Founder of Moushi & Co. moushi.co

The Baader-Meinhof phenomenon

We’ve bolstered our marketing efforts by employing the Baader-Meinhof phenomenon. In a nutshell, it explains why cognitive bias occurs when a product that a target market has just noticed online or heard through word-of-mouth marketing suddenly crops up constantly. 

A more consistent presence in different channels makes our brand more trusted. For instance, we’ve invested in multi-channel marketing to get the word out about our website and the bodyboard products that we carry. We then take advantage of social proof through customer reviews and features on our newsletters. Our customers’ testimonials are essential in our brand’s great storytelling approach to leverage confirmation bias.

Finn Cardiff, Founder of Beachgoer

Tangible offers with visuals

Try to make your landing pages more tangible for the target audience. Make sure they can relate to what you are offering. This requires you to customize the product video, content, color scheme, and overall presentation based entirely on your customer’s needs. When you are offering digital products, you need to execute tangibility as much as you can. Therefore, your customers can visualize what it feels like to actually use the product. This is an amazing technique to align your marketing goals.

Sameed Ajax, Content Strategist at PureVPN

Rhymes are memorable

The extraordinary power of rhyme is deeply rooted in our culture. Rhymes are well listened to and easily assimilated, and repetition of a statement makes people think it is more likely true. A good example of effective rhymes is the classic Jaguar Type-E advert, which shows a car drawing and the words Grace…Space…Pace. Rhymes add credibility and are easily absorbed and remember, but you should avoid clichés.

Agnieszka Cejrowska, Content Manager at Profesjonalne Pozycjonowanie

Everybody loves getting things for free

Using the word Free in Ad copy, offline or website has proven quite effective in marketing. Free could be a trial, service, add-on, consultancy, quotation, or items. It’s a human mindset and tendency to get attracted to the word ‘free’

In my experience, I have used the word free quotation in many ad copies and landing pages and it performed better than the copies where the ‘free’ word was not written.

Harshil Bhatnagar, Founder of Staiir Social Media Marketing

It isn’t uncommon for emotions to trump logic when it comes to consumer choices. We advised one of our business customers to leverage irrational consumer behaviour by offering free shipping on select products for an online retailer. The kicker is, they didn’t want to mess with profit margins, so they actually increased the cost of qualifying items to offset the promo. The total purchase expense was the same, yet they were able to increase sales for targeted products by 22% during the month the promo ran. The items not listed for free shipping showed no changes in consumer trends.

Kimberly Smith, Marketing Manager at Clarify Capital

Names open doors

I wouldn’t call it a psychological marketing trick, but sometimes I use mentions when writing cold letters/emails.

For example, my goal is to do interviews with well-known industry representatives. To get my proposal accepted by new people, I’m mentioning in the very first letter the name of another person who has already agreed to participate in the interview. As my practice shows, this approach is fruitful – my new interlocutor is more likely to be agreed to participate too.

Tatiana Gavrilina, Content Marketing Writer at DDI Development

The Rule of 3 rules

In marketing, I use the Rule of 3 all the time. Three is known as the most persuasive number in communication. It is easy to remember, and it’s the smallest number to recognize a pattern in a set. Here are a few examples of how I utilize the rule:

– Breaking down any process into three steps

– Presenting three value propositions on a web page

– Creating a three-point agenda for a webinar/presentation

Do you want to keep people’s attention and be remembered? The Rule of 3 is your best ally.

Karolina Gawron, Head of Marketing at Surfer

Price anchoring is king

I am CEO at a product development company for SaaS startups. We help founders with pricing strategies. And psychological tactics in marketing are in wide use in pricing plans. One of the best is price anchoring.

The price of something is a relative concept of something. And just relativity is a manipulative factor to use price anchoring.

To use this approach, place the most expensive package in a prominent place. There is no guarantee that people will buy it. But the main thing is to give the impression that other options are more accessible.

Then, at the cross-selling or upselling stage, you can repeat this trick in order to move from a more expensive to a more “reasonable” price package.

For example, Mailchimp use such an approach.

Maksym Babych, CEO at SpdLoad

Creating a sense of urgency

During the present pandemic lockdown, commercial transport systems or logistics are operating in a highly irregular fashion. Our promotional campaigns are highlighting this irregularity of logistics. We’re repeatedly telling our audience to pick up things when they’re still in stock. Due to irregular shipments, the next availability of anything is uncertain that runs out of stock now. 

This statutory warning has created an extreme sense of urgency for our audience and customers. Eventually, they are rushing to get our online discount coupons to buy their requirements before stocks last.

Andrei Vasilescu, CEO and Digital Marketing Specialist at DontPayFull 

When consumers see that there is either a countdown timer within an email, or a number of units left/sold on a particular product page, it really helps to create a sense of urgency, psychologically, for the particular product/service that you’re promoting. These types of tactics are not only great psychological tactics in marketing but also a great way to quantify and qualify the demand for that specific product/service for your own knowledge as well.

Carley A. Hanna, Digital Marketing & SEO Lead at Supplement Warehouse

Negative superlatives are more effective

I’ve written a fair amount of blogs, and the best-written blogs don’t always attract many click-throughs. Because the headline isn’t compelling.

So I started researching why some blogs are a click magnet. I realized by implementing a few psychological tricks in the headline of my blog. I can attract more clicks. My favorite is using superlatives words like best, biggest, and greatest. It can be effective in headlines. But it turns out that negative superlatives (like worst) can be even more powerful. We noticed negative superlatives attract more clicks.

Abdulaziz Ali, Content Strategist and Content Writer at Digital Growth Boost

Picture yourself

Use words like imagine or picture yourself at the start of your copy, especially for e-mail marketing and Facebook ads. This works especially for clothing brands because it triggers the imagination of the viewer. For instance, if you sell t-shirts, you can write something like Imagine wearing this cool t-shirt for your next adventure people will imagine themselves wearing it, which increases the chances of impulse buying. 

Ronald D’souza, Digital Marketing Manager at FJackets

Playing with emotions

One effective way is to run emotional ideas. Studies have shown emotional and psychological appeals resonate more with consumers than feature and function appeals. You can also get the emotion of the people by your advertising copy. Demonstrate for them to see how it works or incorporate trendy ideas on copy for posting online. Use memes, trendy statements, and relevant persons to get the attention of the potential buyers.

Tal Shelef, Realtor and Co-Founder of Condo Wizard 

Man on the moon ad

© John Lewis | Man on the Moon, 2015

Color marketing is for real

While we typically advise against psychological marketing tricks (customers tend to see right through them and they don’t engender customer loyalty), we have found that the color theme of your site matters a great deal as a psychological tool. For instance, using blue and green in color themes tend to engender more trustworthiness than more loud colors like reds, yellows and oranges. Dwell time tends to be higher and based on polls, customers tend to trust brands who have a color scheme that reflects this same vein.

Nate Nead, CEO at SEO.co

What’s that smell?

In a controlled test, we pumped the smell of chocolate into a supermarket in the UK. We measured sales of chocolate in the weeks before and after the initiative. When the aroma was present, sales of chocolate increased by 29%. As part of the project, we also interviewed more than 100 shoppers as they left the store. Not a single person recalled smelling chocolate. As a result of this Sensory Marketing initiative, further aroma dispensing activities took place in Australia and India. Both with the same results.

Phillip Adcock, Managing Director at Adcock Solutions

Clustering related functionalities or incentives

You have learned of this psychological marketing tactic if you have ever researched or attempted to improve productivity in the field. Clustering is the process of arranging identical pieces of knowledge so that you can best recall it.

Once the hippocampus enters your long-term memory to recall something, it searches for the related cases. It’s meant to be that it’s a more convenient place to store anything. You wouldn’t place the wrenches together on different shelves so that you can locate the same model when you’re looking at them all.

One research experimented with textual clustering. The investigators provided a random collection of fifteen words to participants and challenged them to recall them. We then offered them a separate set of 15 words but divided them into related topics. In the second study, the results revealed a significant improvement in awareness.

The most successful approach to do this is to bring together related functionality or incentives on your landing pages and things relevant details in the same parts of your posts. Bulleted lists may be a simple route.

Lesley Reynolds, Co-Founder of Harley Street Skin Clinic

Storytelling never gets old

Knowing that everybody enjoys a good story, we like to mix our marketing materials up with interesting and entertaining anecdotes. Storytelling elements are weaved seamlessly into our blogs and web pages, encouraging prospective customers to imagine the benefits of using our services. It’s known that the great majority of customers have a preference for story-based

advertisements; with the blend of eye-catching visuals and creative wording having the greatest psychological impact. The sense of emotional connection means that branded stories live long in the memory.

Ryan Pitylak, CMO & Founder of ZenBusiness

Illogical reasoning works like magic

One simple psychological marketing trick is the use of illogical reasoning. This focuses not on what people say but on how they say it. People have been proven to follow suggestions so long as there is a reason for them, even if it doesn’t make sense. We have blind spots when someone uses “because” since it allows us to justify things even when they don’t make complete sense. That’s why it’s important to know which words are powerful when it comes to driving behaviour. One word in your marketing efforts can change how people react to your messages.

Nathan Robinson, Founder of Neighborhood Square

Discounted prices always work

Strike-through pricing was one of the tricks I most commonly used when I was leading marketing in the travel industry. On comparison shopping sites, our price would be consistent with other providers – but it would be shown with a strike-through. This indicated to users that, if they clicked on our listing, a better price could be had. Not only did this serve to get more clicks to our site, it also drove enrollments into our loyalty program as membership was required to get the reduced price.

Brent Bouldin, Co-Founder of New Media Advisors

How you show the price makes a big difference in marketing. If you offer a sale, put the old price in a big, bold font, then cross it out. Put the new price in a smaller font. This makes the new price seem even smaller. 

Similarly, studies show that if you don’t put a comma in the price, prices seem smaller – so $2000 looks less than $2,000. This comes in handy for multi-currency or multilingual websites, as other cultures often use a full stop instead of a comma to separate thousands. No need for either, just remove it completely!

Martin Woods, SEO Director at Indigoextra

ELMR framework – what is it?

Effective marketing psychology strategies are often built upon some variation of the ELMR framework:

– Emotion: Messaging and imagery that connect with an audience

– Logic: Educating a prospect on the details of a product or service helps to make a customer more confident in their decision.

– Motivation: Reducing friction will make it easier to create a sense of need and motivate people to action.

– Reward: Creating a sense of approval and validation of one’s decision.

Using this sequence helps marketers understand and optimize each step of the buyer journey, ultimately leading to more effective marketing campaigns.

Rod Austin, Head of Marketing at 4Degrees.ai

Playful quizzes to spark up engagement

People love to take quizzes. Yet few companies and marketing teams are unable to devise a reliable and valid one. Why? They tend to talk at the (potential) customer rather than share a conversation.

As a psychologist, I develop a quiz for the individual to fail and realize they need the company’s product or service. A healthcare quiz in the practice’s brochure or on its website homepage keeps the reader engaged.

For example, an easy to understand analogy is the Dental Health Quiz:

  1. Do your teeth bleed when you brush?
  2. Are you embarrassed to smile?
  3. Are your teeth sensitive to hot and cold?

….etc.

Scoring: If you answered “Yes” to more than half of these questions, then you need to make an appointment with Dr. Jones.

Dr. Elliott B. Jaffa

The foot-in-the-door tactic is the perfect bait

One psychological marketing trick that I commonly use is what’s called the foot-in-the-door technique. This technique first involves asking for a small commitment up front with the aim of getting the consumer to agree to a larger commitment later. You can see this most commonly with free-trials. The word free is an emotional trigger for many consumers and can be difficult to pass up. It’s also a great way to get consumers to make that small micro-commitment upfront, which will likely lead to them purchasing the entire product later.

Tonya Davis, Marketing Manager at ThoughtLab

Offering unique value proposition

As a psychologist who started a branding/marketing consulting business, I use consumer psychology research to inform our client work. We know when a consumer is faced with multiple options that are all very similar and one option that is markedly different from the rest, human nature is to gravitate toward the one that is different; it is actually more beneficial to promote what makes you unique rather than touting your quality. 

So when we work with commoditized service providers (e.g. real estate agents, mortgage loan officers, insurance agents, etc.), we create a Unique Value Proposition for each client that is truly different from each of their competitors. This increases the likelihood of them being hired by their prospective clients.

Dr. Frank Bevacqua, Owner of Time To Thrive

Maintaining high standards to stand out

Telling prospects why they can’t buy from you is an incredible psychological tactic in marketing. Because they’re used to desperate marketing, when you set the standard high for who qualifies for your offer and who doesn’t, your sales often soar. 

For example, on your landing page, if you’re a consultant, mention that you don’t work with startups, businesses doing less than $10 million, and companies without solid product-market-fit. This begs the question and answer “Why are they so strict on their standards?” It must be because they’re really good and can be strict.

Brian Robben, CEO & Founder of Robben Media

The halo effect is a double-edged sword

There is a psychological phenomenon called the Halo Effect that describes a person’s cognitive bias to prefer a certain company simply because they enjoyed a product or service of theirs in the past. This bias can be used to a company’s advantage in marketing by following up after sales to make sure customers were satisfied and extending additional offers. Happy customers will be highly likely to buy again.

While this kind of brand affinity is great, it does come with the higher risk of negative consequences if a customer has a bad experience because their reaction will be more extreme than towards a company they haven’t built a relationship with.

Jesse Silkoff, Founder of MyRoofingPal 

One-two punch to grab attention

Attention spans have been dwindling over the years due to the internet, texting and 15-second TikTok videos, among other things. I call it a one-two punch. No one has time for (or wants) a third these days.

  1. Get their attention with VISUALS
  2. Tell them what you want them to do (CTA)

Then you can elaborate but keep in mind that the further down in your message, the more people you are losing.

Sara Miranda, Founder & CMO at The Good Camp

Social competition as a trigger

At the end of each blog post, I have a call to action that says Don’t Let the Other Guys Out Dress You. This simple CTA works because it leverages two powerful psychological principles: social competition and FOMO. By implying that other guys are already dressing well, my readers feel like they’re behind their peers, and they needed to sign up for my email and read my advice in order to keep up.

Dave Bowden, Founder of Irreverent Gent

Offline engagement to avoid the online noise

A neuroscience study found physical advertisements appear more real to the brain than digital content, resulting in deeper emotional processing and higher brand recall.

This is why leveraging direct mail or gifts within workflows can be a game-changing tactic. Engaging in the offline with tactile advertisements creates this pattern interrupt and has been able to book us more meetings.

Prospects, leads, and customers are tired of seeing the same templated, automated email…they receive hundreds of others (on a daily basis) that look exactly the same.

Offline engagement creates authentic connections that our brains naturally perceived as more meaningful.

Richie Pusateri, Marketing Associate at Postal

Keeping up with the Joneses

Of all the motivations that drive human beings, none is as common as wanting what someone else has. There is actually something called the Jones Effect, coined from a 1913 comic strip – “keeping up with the Joneses.” In the strip, the McGinnis family strove to keep up with what their next-door neighbors the Joneses had. In marketing, this impulse can be used to sell almost anything. If the target audiences’ ostensible neighbors the Joneses have a new car, we need a newer, better one. If they just put in a new backyard deck, we need a bigger, better one.

Michael Nemeroff, Founder and Former CEO of RushOrderTees 

The theory of three hawkers

Our best tried, and successful tip for marketing based on psychology will be, ‘Theory of 3 Hawkers!’ It is based on local folklore that there are three types of hawkers:

  1. Who exaggerates on their product to lure customers
  2. Who markets how their products are to maintain clarity
  3. Who understates their product to appear humble and noble

Providing an innovative digital and automated management consultancy service to small and medium enterprises, we follow the (2) one. In B2B, clients are wise enough to assume the real value of services they are demanding, so we find it effective to market with clarity, honesty, and transparency.

Jash Wadhwa, Content Writer at Value Growth Audit

What eye movement and marketing have in common?

Location, Location, Location! Focus on the upper right area of your ad space. Research studies have traced human eye movement and found that upon first glance, our eyes are drawn to the upper right corner of screens or advertisements. For example, whenever I create social media content, I try to place the key takeaway in the upper right corner of a post. It’s a simple, useful way to tell your audience what you want to tell them.

Dakota Kalbacher, Owner of Kota Marketing

Playing with open cards

In college, running a booth at the local farmers market got me interested in finance and payment processing. The produce was cheap so margins were slim but volume made up for it. The problem was credit card fees eating all the profit. One day I made a sign that said, “Keep Your Money Local! Pay With Cash So I Can Spend It Here Instead Of Paying Credit Card Fees. Thank You!”. It worked! People appreciated the honesty and local angle. Credit card processing solutions are better now but appealing to what matters to customers is still a winning strategy.

Chris Waltenbaugh, Payment Processing Expert at Payment Depot

Giving less choice brings more cash

You might think giving consumers lots of choices is a way to increase your chance of getting them to buy your product or service but in fact, less is more. There is a psychological phenomenon of over choice which occurs when many equivalent choices are available making a decision overwhelming due to the many potential outcomes and risks that may result from making the wrong choice. Choosing between too many options can cause decision fatigue where more choices make us less likely to buy, and to be less satisfied with our eventual decision.

Paige Arnof-Fenn, Founder & CEO Mavens & Moguls

Conclusion

There’s a whole science behind marketing psychology; it’s not about playing cheap mind tricks. The consumer’s brain has evolved to recognise when marketers try to trick them, so be careful. Don’t exaggerate with the use of  psychological tactics in marketing or they can easily backfire. Play it smart!

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Improving remote team collaboration: 5 steps to get you started

Improving remote team collaboration: 5 steps to get you started

by | Dec 1, 2022

Business Tips

Improving remote team collaboration: 5 steps to get you started

December 01, 2022

Tips for improving remote team collaboration

What started as a necessity, remote work has now become the norm for most companies – big or small. However, with the sudden shift to remote communication, managers and employees alike are struggling to keep up with optimal collaboration. 

5 strategies for improving remote team collaboration

If you’re trying to manage your remote team and want to improve overall collaboration, this post shares five tips to try out. Keep on reading to learn more.  

Establish workplace norms

Every remote team has its own way of achieving its goals. Thus, you need to work with your team to define and establish communication and collaboration norms before they start working. 

For instance, what are their core working hours? A remote team can’t be online from 9 AM to 6 PM local time every day, particularly if you have international members. You should work with your team to define when they’ll be online and available for a meeting.

In addition, you may have specific language such as acronyms known only by your team. So, make sure to clearly define what these acronyms are and document them for easy reference. 

Also, you need to consider how your team will communicate and on which channels. Clarifying which tools remote teams will use and when it’s appropriate to use these channels is necessary to ensure productivity and improved collaboration. Lastly, you should set rules for each channel such as using cameras or muting themselves if not speaking on a video call.

Provide the right tools

Speaking of tools, your remote team can’t collaborate effectively without the proper tools. So, make sure to equip your team with the right tech stack for remote work. This should include tools for:

  • Video conferencing;
  • Project management;
  • Chat;
  • Brainstorming;
  • Real-time collaboration; and so on. 

Another great idea would be to incorporate AI into the workflow. Such tools as an AI Meeting Assistant, AI Project Planner, AI Task Tracker, etc. However, providing your remote teams with the right tools is not enough. In addition, you should teach and train them how to effectively use these tools. So, establish guidelines for your team on how to properly use these tools.

Create time for bonding

Your employees may not be near each other as in an in-person workplace, yet their closeness can impact how well they communicate and collaborate together. Thus, you want to use virtual team-building activities to help your remote employees feel more connected and less isolated. It can boost their engagement, participation, and overall productivity too. 

You can try common social opportunities such as Coffee Hours or online escape rooms or try some unusual indoor team-building activities such as scavenger hunts or comedy shows. There are hundreds of ideas on the internet, or you can ask your teams for their suggestions and ideas. 

Hosting fun activities every now and then can help your team better connect, build team bonding and keep communication strong. As teams get closer, collaborations become more natural and easier.

Implement asynchronous communications

In the traditional workplace, synchronous communication is the standard by which employees need to respond to messages as soon as they received them. Nonetheless, in a remote workplace, asynchronous communication is a more suitable option, allowing employees to reply promptly when it’s productive or convenient for them to do so. 

With this communication model, you give your remote team space to work. This way, they can focus and avoid breaking their productivity or the flow of work by replaying a distracting message. For managers, this can help them avoid micromanaging. 

That said, you don’t want to wait days for employees to reply. Hence, you want to implement clear guidelines on an expected response time for all kinds of communication. For instance, you can set a 5-hour response window for messages or revision requests. This ensures that your team can respond at their most convenient time without slowing down others or delaying a project.

Optimize virtual meetings

Meetings are a necessary evil for team brainstorming. Sadly, they often become a waste of time if not managed properly. Henceforth, make sure to optimize your meetings for more effective collaboration. 

For one, make sure that any recurring meetings are as short as possible, preferably 15-30 minutes long. This way, your team has more time to do actual work. Further, it’s important to create an agenda before the meeting. Invite only the necessary people to the meeting and encourage notes taking. Make sure to assign the next steps before the meeting ends as well. 

Lastly, try to minimize the scheduling of video meetings as possible. Though virtual meetings have their place and time, you shouldn’t make them the norm. This is because they’re a big productivity killer. Online meeting fatigue is real. If possible, you can convey things you need to know using messaging apps or project management tools.

Conclusion

Remote work has become an expectation in today’s modern workplace. That said, even the most seasoned leaders still find it difficult to manage their remote teams. Due to the lack of face-to-face meetings, digital communications may lead to gaps in understanding and result in poor collaboration. But by implementing the above-mentioned tips, you can overcome hurdles to collaboration productivity.

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Customer appreciation ideas: 26 ways to express gratitude

Customer appreciation ideas: 26 ways to express gratitude

by | Nov 30, 2022

Business Tips

Customer appreciation ideas: 26 ways to express gratitude

November 30, 2022

customer appreciation ideas

Small businesses shouldn’t wait for Customer Appreciation Day to say ‘thank you’ to their loyal customers. We have talked about customer focus previously and how important it is for the growth of any business, So, spending time to think through some ideas about how you can show your appreciation for you customers can be a excellent investment.

Saying ‘thank you’ to your customers can be done in many different ways. However, what matters is that the gesture is done with honest intentions. There are a great deal of customer appreciation examples whose only purpose is to grow sales, and trust me, customers can see through that.

Jump To 

 1. Scented ‘thank you’ cards

 2. Virtual Happy Hours

 3. Shout out on social media

 4. Cross-appreciation for effectiveness

 5. Let them eat cookies!

 6. Treat customers as winners

 7. Customer appreciation funnel

 8. Starbucks coffee – lasting impression

 9. When customer appreciation backfires

 10. Snail mail is better than email

 11. Actions speak louder than words

 12. Who’s up for backyard makeover?

 13. Sending love for their birthday

 14. Yummy snacks make everything better

 15. One chance for a first impression

 16. Here’s your money back!

 17. Listen carefully before you speak

 18. Netflix and chill

 19. Show your altruistic side of business

 20. A little party never hurt nobody

 21. Break the rules

 22. Trick or treat for the adults

 23. The Devil is in the details

 24. Following up after a review

 25. Inviting them to fun events

25 creative customer appreciation ideas to express gratitude

While there’s nothing wrong with traditional customer appreciation ideas, we believe that going the extra mile and doing something unique will gain you bonus points with your customers. Of course, you don’t have to buy them cars but a set of winter tyres is not a bad idea as you can see below.

The good thing about these customer appreciation ideas is that you’re not supposed to copy-paste them. Instead, use them for inspiration and come up with ideas that will suit your business model and brand.

Scented ‘thank you’ cards

One thing we have experimented with engaging customer loyalty. We send a handwritten thank you card to each customer that completes 3 transactions.

We also spray them with a scent that smells like freshly cut grass. This engages the strongest sense we have: the sense of smell.

Right now, we have approx 200,500 customers, and we are measuring the impact on these efforts, however, it’s still too early to tell. If we see it has a lasting impact we are going to figure out a way to scale it, possibly with one of the services that send out handwritten cards.

Bryan Clayton, CEO of GreenPal

Give them a shout out on social media

Quoted retweets and sharing the experiences of your consumers through social media channels can be the perfect way to show consumers you are taking the time to read what they are saying, and really appreciating their input. 

It allows consumers to feel a real part of your community and make them invested in your business because you are taking the time to interact and comment and their personal experiences and adventures with you, your product, or your service.

Adam Korbl, Founder & CEO of iFax

Cross-appreciation for maximum effectiveness

Everybody sends holiday gift baskets and game tickets, but we take it to another level.  We appreciate our customers by doing something that we call cross-appreciation. 

For example, one of our clients is a well-known tire shop in Toronto. During the wintertime, instead of sending a holiday gift basket, we offer our top clients free winter tires. The tire shop appreciates us giving them business and offers us a huge discount while the other clients appreciate our concern for the safety of them and their family. 

But it doesn’t just stop at winter tires, we do the same thing every 1 – 2 months. Sometimes offering clients free exotic car rentals, to weekend resort stays. Using our own client’s services to appreciate other clients has benefited us greatly.

Safeer Qureshi, CEO of SPG Media

Let them eat cookies!

At Studio Simpatico (a design studio in NYC), we primarily engage our clients in company rebrand or website redesign projects. During the course of the project, we’ll engage with numerous stakeholders within the organization. When a project wraps up, to express our thanks, we’ll often send a batch of Insomnia Cookies so everyone can enjoy the gift. (If you’re unfamiliar, Insomnia Cookies are quintessentially New York, and infinitely more delicious and less expensive than a boring fruit basket.) As a bonus, we’ve heard that oftentimes the delivery will lead to an ad hoc cookie consumption extravaganza and brand/website launch celebration!

Tamara Olson and Sinan Imre, Co-Founders of Studio Simpatico

Treat customers as winners

I aim to make my clients feel like winners. So I found a vendor who can create copies of Olympic medals with my clients’ names and faces.

In 2019, for each client who worked with me 6 months or more, I create such a personalized gold-plated medal and sent it to their address.

Their surprise and gratitude are extraordinary. Those moments are the deep reason why I am in business.

Abdulaziz M Alhamdan, M.Sc. Positioning Expert at StoryBonding.com

Customer appreciation funnel

Clarafy UX works with high-value clients that we absolutely love, so we have built a funnel just for customer appreciation.

Once a client signs up with us we immediately send them a handwritten ‘thank you’ note with a small gift. We repeat the process every month the client works with us, and through the holiday season for 5 years after our clients complete their contracts.

This simple strategy has helped us retain and re-contract with almost every client we have ever worked with.

Clara Fairbanks, Lead Designer at Clarafy UX UI

Starbucks coffee to leave a lasting impression

One way to express appreciation for my clients is mailing a handwritten thank you note with a small Starbucks gift card. In a world of the digital age, we often forget how to make a meaningful and personable connection with our clients. 

For me, I often do not see agents in person. They book appointments on my website, give access to homes for photographs and everything is delivered digitally. With this, I felt like I was easily forgotten because I never got to make an impression so I started mailing handwritten thank you cards and have had an overwhelmingly positive response and in doing this it has allowed me to grow my business.

Ashley Askew, Owner of Shutter Club

When customer appreciation backfires

I have to be honest, customer appreciation almost backfired on me. 

In the initial days of my business, I tried giving a courtesy call to the parents who referred me to their friends and relatives, only to come across as needy and borderline pushy. They misconstrued my courtesy as a nudge to enrol their kid again, and needless to say, that never happened. 

But I get it that customer appreciation is an important part of any enterprise, and even after its initial debacle, I now do it more discreetly and strategically. I give exceptional service during the time of a student’s stay with me, thinking in my mind that outstanding work in itself is the deepest kind of appreciation and a gesture of gratitude to anyone. This is something taught in great detail in customer service training Melbourne programs. 

Shipra Batra, Founder of Shipra’s SAT and Creative Writing classes

Snail mail is better than email

We are a small retail jewelry business with a store and online website. We set up an automated system that sends out postcards to our customers two weeks after they place an order with us. We thank them for becoming a customer and the owner and his wife sign it. 

We do this because people these days are bombarded with emails and sending a postcard gets it right in front of them and shows that we are going the extra mile to thank them. We have received a ton of positive feedback from customers that they were very surprised to receive something like this from a company.

Jeff Moriarty, Marketing Manager at Moriarty’s Gem Art

Personal handwritten thank you notes showed our customers that we cared enough and appreciated their business to take the time. Appreciation comes in all forms and where budgets can be tight for a business you need to be creative. We sent personal thank you notes from the most relevant staff member to thank our customers. Our customers said it was a novelty and a nice surprise to receive something in the post rather than a bulk sent thank you email.

Shayne Sherman, CEO of Techloris

Actions speak louder than words

To show our appreciation for our loyal customers, we have used this moment to give back to the community on their behalf. At our company, we have long maintained a charitable program whereby we donate 15% of our profits to non-profit groups. It’s the right thing to do, and it has the effect of showing our customers that we value their loyalty, care about our community and are focused on much more than the bottom line. It also has the effect of creating increased customer loyalty, especially among those customers that are community-minded. 

Rebecca White, CEO of Prana Brush

Who’s up for some backyard makeover?

We like to offer our customers value as regularly as we’re able. Many times this is in the free content we produce, but we also have specials that offer discounts and other bonuses. These are all standard things, though.

Last year we hosted a contest for our customers to get a full backyard makeover with an entertainment area, fire pit, etc. We plan to do this again once it gets a little bit later in fall. It was very popular last year.

Dan Bailey, President of WikiLawn

Sending love for their birthday

My number one customer appreciation idea for a small business is to give your customers a surprise phone call on their birthday.

Imagine your customer’s surprise when they hear from you without you trying to sell them anything. Instead, you are simply calling to wish them a happy birthday!

Many of the people we help are ages 50-85 years old, lonely, and they may not even get a birthday call of card from anyone. Our phone call may be the only phone call they get that day from someone who cares about them.

Customers love knowing you REALLY care about them. A happy customer is also more likely to give you referrals and additional business in the future. These referrals often end up being our highest converting leads!

Randy VanderVaate, President and Owner of Funeral Funds

Yummy snacks make everything better

We create and send homemade Snack Packs to our customers and vendors, but not during the traditional holiday season. We share when the gesture is more impactful. The client may be experiencing an internal win with a new contract, a tough time with an unforeseen weather event, long hours, loss of a key leader, etc. 

The snack pack features brownies, fudge, candied pecans and jerky – a little something for everyone. Nothing is store-bought. We want our customers to know that we think about them outside of the workday and that they are appreciated.

Leanne E. King, CEO & President of SeeKing HR

There’s only one chance to leave a lasting first impression

When helping our clients create high-touch experiences for their customers, we always start with creating an exceptional onboarding. You only get one chance at a first impression, right?

As a simple example, in working with private health clubs, they’re often fighting an uphill battle as many consumers are sceptical and untrusting of gyms’ billing practices. To help overcome this, we like to create a personalized, caring experience in the first interaction.

When a prospect walks into the club, we get the staff to immediately engage the individual and find out their goals. If the person is interested in losing weight, for example, then they’ll offer a free low-calorie smoothie from the cafe. This simple act creates a bond with the prospect and sets the expectation that the club is here to listen and help them with their personal needs and goals.

Joe Kerns, Co-Founder of MAJiK Marketing

Here’s your money back!

I thank my loyal customers by returning money to them. When they internally refer colleagues and themselves are repeat customers, I give them a regular corporate/organizational discount. When they externally refer others to me, I extend that same discount to the new customers on their first order. 

This lets me show how much I value my regular customers. I return their loyalty with my gratitude and the best possible service, on an ongoing basis. It also gives their referrals a chance to benefit from the same reciprocally beneficial relationship. Win–win!

Adam Goulston, Owner of Tsujiru

Listen carefully before you speak

On my safaris, I engage with guests and find out what they like and what other destinations they would like to travel to. I then will, during the offseason, put together some specials that would appeal to my guests and market it to them via a personalised email campaign. These specials are catered specifically to the conversations we had, everything down to the kind of linen they like. 

Not only does that offer more business for me, but it caters for my guests’ needs and shows them that their needs are cared about and those casual conversations are remembered. I think it always comes down to those small things that make a big impact and make them a customer for life.

Shaun Taylor, Owner of Moriti Safaris

Netflix and chill

As businesses, we need to show our appreciation to our customers. We need to show them that our brand really cares for them and that we value the loyalty and business that they give us. 

And as for my dating company, a way for us to show our appreciation to our customers is giving them year-long subscriptions to media service providers like Netflix, Hulu, or Amazon. And

they can even choose which subscription they want to avail of. This is a way for us to let our customers enjoy themselves by watching movies with their families and friends. Plus of course, they’d always tell their family and friends that our brand gave them the subscription so it also serves as a marketing campaign for our company.

Sonya Schwartz, Founder of Her Norm

Show your altruistic side of business

We sent handmade masks from a local company to our customers with a thank you note for their support during these challenging times. I hand-signed each one and wrote personal letters to our oldest customers to show our gratitude. The ‘thank you’ note let our customers know that we are going 100% paperless, offering a rewards program for them, and that we now donate $1 every time you purchase, to one of our charities that you select.

Zeshan Jeewanjee, CEO of One Day Event

A little party never hurt nobody

Our office, Parkside Lane, is a co-working space for some of the best event companies here in town. Every year we bring in roughly 50 event planners for a Pamper the Planner event at the office. Music from a DJ or band helps them relax as they are treated to a Mimosa & Bloody Mary Bar, a manicure, makeup, a masseuse and catered appetizers. Pictures and video

are taken for their social media during the event. Moreover, when they leave, a goodie bag with all our information and small gifts is handed out. It’s one of our favourite events.

Dave Forman, Pour Masters Bartending Services

Break the rules

An unpopular tip that will go miles toward cementing customer loyalty and even advocacy for a small business is occasionally bending the rules for good customers. A reasonable degree of latitude for regular patrons; staying open an extra few minutes if they should come running in at night’s end in an emergency, or some other similar extension of out of the ordinary leeway, can show an appreciation for the money that customer spends, make them feel special and valued and spur them to continue to patronize the company.

Haris Bacic, Co-founder of Pricelisto.com

Trick or treat for the adults

My niece, a realtor who launched her own company a few years ago in Greenville, South Carolina, started a great annual tradition for customer appreciation: Halloween Open House. 

The weather is still mild enough to hold the event outside, and she goes all out: hay bales, spider webs, pumpkins to take home, treat-or-treat bags, hot dogs, snow cones, kids’ activity area. It’s clever customer service as her staff mans the booths, and she gets to touch base with clients to thank them again for their business, myself included, staying on their radar for their repeat business and their word-of-mouth recommendations leading to new business.

Karen Condor, Insurance and Real Estate Specialist at USInsuranceAgents.com

The Devil is in the details

We offer customer service depending on customer needs. Us, designers/owners , make deliveries to clients home, write dedicated notes, help them at the store, consequently have a special relationship with many of them. We know about their lives and they know about us, ultimately we become friends. Also, from time to time we host events at the store for customers, so we can connect and get to know them more. We genuinely enjoy all of this. Most of our successful customer relationships are born because of our personalized service.

Bianca and Paola Muns, Co-Founders of  MUNS

Following up after a review

I like to follow up with a personal email or note to everyone that leaves a review on the site. It’s a way to connect and build a rapport with your client base so that they know another human is directly affected by your feedback and kind words. It’s time-consuming, but so, so worth it.

Emily McNabb Butler, Owner of The Good Hippie

Inviting them to fun events

One thing that is always appreciated and more so now than ever before, is making a charitable donation on behalf of your customer. Not only is this an awesome gesture to your own customers, but you are also helping out people who are making this world a better place. Some organizations run on donations and if your company has the ability to help, then why not?

Your customers’ dollars are going twice as far with their purchase of goods or services from you and a portion of that money being allocated to a good cause. They are able to get what they want and help who they want without much thought. This is simply the best of both worlds and your customers will be more than happy to return again.

Edwin Rubio, VP of Sales for VaporEmpire.com

Making the world a better place for everyone

One way for small businesses to show their appreciation to customers is through organizing meetups. GoShare has launched its on-demand delivery service in over 30 markets nationwide, and we are currently expanding to many other cities across the United States. 

When we launch a new market, we love to express our gratitude to customers and contractors by inviting them to events where we are able to connect with them in person. In 2019, we were able to post a series of community meetups at Nascar events, bringing contractors and early supporters of our business onto the track to meet drivers and see the cars up close. By creating new relationships and developing existing ones with customers, small businesses can greatly improve customer retention and enhance their brand affinity.

Shaun Savage,  CEO and Founder of GoShare

Conclusion

Whenever you run out of customer appreciation ideas turn to this article and remember that there’s no such thing as a bad ‘thank you’. Your customers will appreciate even the smallest gestures.

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Domain name branding: A quick guide (2025)

Domain name branding: A quick guide (2025)

by | Nov 22, 2022

Business Insights

Domain name branding: A quick guide (2025)

November 22, 2022

Importance of domain name branding

One of the most important parts of building a website is choosing the right domain name that perfectly suits your goals, products, and services. If you fail to do this properly, you might damage your brand’s reputation.

A domain name is technically an address of a website. It’s a part of the Domain Name System (DNS) that allows internet users to enter a series of words rather than a set of numbers. Also, it functions not just as an address but as a first impression visitors will have about your brand.

This is especially true regardless of your field of expertise, whether you’re a small business owner, a corporation, a freelance writer, or a professional service provider. That’s why the right domain name is as important as your brand logo and company name. You can visit VentraIP’s official site and other reliable online resources to learn how domain name branding can help you increase visibility and build trust.

5 tips on choosing the best domain name for your brand

Now that you know how important domain name branding is, it’s time to go over some useful tips that may help you do that properly.

Choose an extension carefully

A domain extension is the last URL segment after the domain name. The most popular extensions are .com, .net, .co, and .org. Among these options, .com is the most popular.

But what if .com is already taken by someone else? Is it the end of your website? Not at all. As mentioned earlier, there are other popular extensions you can use aside from .com. On top of that, other extensions such as .xyz, .shop, .art, .inc, .online, and .club, are becoming more common. Also, some extensions may help you become more relevant in the industry you belong to, such as .technology and .marketing.

Country code extensions are on the rise as well such as .us (for the United States), .ca (for Canada), .au (for Australia), .uk (for the United Kingdom), and .sg (for Singapore). Regardless of these types of extensions, you want one that’s cohesive, relevant, and shows credibility.

Use targeted keywords

Keywords aren’t only for content but also for domain name branding. Search engines analyze domain names to understand your website and help them determine your site’s rankings. That’s why it’s important to add your keywords as much as possible.

However, be careful when choosing a keyword. You want to make sure the keyword you’ll use is relevant to your brand and targets the right audience. If you’re having difficulty choosing the right one, you may use a keyword search tool online. This tool can help you explore thousands of keywords based on different factors to determine the terms people often use when browsing the internet.

Make the domain name easy to pronounce

When choosing a domain name, make sure it’s something people will remember easily. If you try to come up with words only you can understand, people will get confused, even if you use the .com extension.

Although word-of-mouth is a powerful marketing method, it’ll be useful if people can remember and pronounce your domain properly. This can increase the chances of people passing and visiting your website. So, what should you do?

When choosing your company name and eventually your domain name, use words familiar to your target audience. If you’re planning to sell fishing tackles, you may try domain names like ustackles.com, fishandtackle.com, or tacklesandreels.com. As you can see, these are simple and easy to remember rather than pointless cute invented names.

Don’t use hyphens

Hyphens can make your domain name look stylish and creative. Also, they’re popular in most European countries such as the United Kingdom and the Netherlands. However, they’re hard to express verbally. Imagine yourself saying the word ‘hyphen’ or ‘dash’ out loud when advertising your website’s URL. It looks awkward and might be misunderstood by many people as a whole word included in your domain name instead of punctuation.

Not just that, hyphens also make it more difficult to type a website’s domain name, resulting in a poor user experience. This means people who want to visit your site may end up not visiting it because of a hard domain name, leaving them no choice but to go to other websites.

Keep the domain name short

Short domains work much better than long ones. The reasons are quite obvious: they’re easy to type and remember, resulting in positive user experiences.

Today, short domain names are becoming more and more important as the number of mobile users continues to increase. That’s because they fit the small screens compared to long ones, making it easy for mobile users to remember the site they visit. Also, long URLs often scare site visitors. If you make your domain names unnecessarily complicated, your audience might raise suspicions about you.

Conclusion

Domain name branding is a crucial step when building a website. You want your domain name to be as simple as possible so people can easily recognize and remember it. Furthermore, you can use the tips above to make a winning domain name that can boost your site’s traffic and ranking.

Today, short domain names are becoming more and more important as the number of mobile users continues to increase. That’s because they fit the small screens compared to long ones, making it easy for mobile users to remember the site they visit. Also, long URLs often scare site visitors. If you make your domain names unnecessarily complicated, your audience might raise suspicions about you.

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27 pricing strategies to help you set the prices for your products

27 pricing strategies to help you set the prices for your products

by | Nov 4, 2022

Business Tips

27 pricing strategies to help you set the prices for your products

November 04, 2022

Calculating pricing strategies

Why are pricing strategies so important that we decided to dedicate a whole in-depth article to them you ask?

For starters, pricing strategies are directly responsible for increasing the sales volume or decreasing it and they also influence online sales. Why? Because they are essentially intertwined with the sales strategy plan. Not to mention that the way you price your product or service is a reflection of your brand’s reputation. And that’s just the beginning.

Therefore, without a smart pricing strategy in place, you will find yourself and your business in entrepreneurial limbo.

The Holy Trinity of product pricing strategies

All of these examples of different pricing strategies are especially helpful in unique business situations. If you are in a situation where you’re searching for ways how to finance your small businessor even when starting a new eCommerce business, you must first know how to price a product or service in order to make a profit out of it.


Knowing the in’s and out’s of the mystery that is the pricing strategy is a must, not only for new businesses but also for already established businesses that are looking for ways to enhance their efficiency and for small businesses looking for ways to become more profitable.

Competition pricing or market based pricing

If you want your company to be a leader in your industry, you must have extensive knowledge of your competitors and how they run their businesses. Just ask the entrepreneurs whose companies skyrocketed this year.

An analysis of the way in which your competitors price their products leads to you understanding their pricing strategies and making a pricing decision on your own based on that. This is why competition is really good for business. This may be lower, the same or higher than the competition, depending on how you want to differentiate and position your product. In broad terms, the elasticity of demand means that lower prices should lead to higher sales volumes; however, you will have to sell more products, which will, in turn, increase your costs.

Cost-plus pricing 

This is a pricing strategy whereby you work out the production costs and add a fixed percentage markup in order to discover the selling price. For example, if a product costs £100 to manufacture and the markup is 25% then the selling price will be £125. This pricing strategy is often used in manufacturing companies.

Other product pricing strategies

OGOF: Buy One Get One Free. This pricing strategy is much loved by supermarkets all over the world and will definitely get your product in stores and keep it there. It is a variant of Bundled pricing. Everyone likes to get something for free and BOGOF can be used by most organisations including B2B enterprises.

Bundle pricing: Two or more products are bundled together and sold at a single price. “If you buy this, I will throw in that.”

Deadline pricing: “If you buy by the end of the month it will be £X; after that, it will be £Y.”

Dynamic pricing: Enterprises set flexible prices based on market demand.

Decoy pricing: Offer at least 3 products – 2 of which have a similar or equal price. The 2 products with similar prices are the most expensive. One of these is less attractive than the other one. Customers compare the options with similar prices. Sales of the more attractive high-priced item go up.

Freemium pricing: This is not just a pricing option, it is a business model in its own right. The way you make freemium work is by promoting a free version of a product, i.e. a smaller version or one with fewer features. The objective is to convert a proportion of the users into paying customers, who then receive the full product. Examples being MailChimp plugins and Spotify music streaming.

Geographic pricing: Different prices are offered to customers depending on where they live or happen to be. (Petrol prices!)

High-low pricing: Products are priced higher than competitors. However, promotions offer lower prices on some products, in order to gain new customers (think mortgage rates).

Loss leader pricing: A pricing strategy that attracts new customers and increases market share. The product or service is sold at or below production cost, or the cost of buying it in.

Options pricing: An extensive range of optional features are offered to a basic product. Beloved by the car manufacturing industry (…“the engine is an added extra.”)

Pay what you want pricing: The customer is allowed to pay whatever they feel is reasonable for the product or service. A ‘floor’ price may be set, or it may not be. This pricing strategy has been tried within the music industry. It can attract considerable publicity.

Payment options. Pay by cash or card? Lease the product or purchase it outright? For example, these days there are many different B2B payment solutions that small businesses can offer.

Penetration pricing: The enterprise chooses low pricing in order to boost sales and market share. If sufficient market share is attained, they may choose to increase prices. However, penetration pricing can start a price war.

Premium pricing: A high price is set in order to reflect brand exclusivity and product quality. Think Rolls Royce and Rolex watches. Interestingly, it is not just the physical product that attracts buyers (think buying experience, service and all sorts of additional touches).

Price skimming: An enterprise starts with a high price and then gradually lowers the price, in order to increase market share. The result is that profits are ‘skimmed’ from the market, over time. Usually employed when there is a clear picture of the product’s life cycle (i.e. within the software industry).

Product line pricing: Each product line (or product category) is given its own pricing. For example, budget, standard and premium product ranges.

Psychological pricing (AKA Optical pricing): This strategy just might be one of the most effective psychological marketing tactics. For example, selling a product at £4.97 or £4.99 rather than £5.00. A small change in price can make a significant difference in turnover.

Self-liquidating pricing (SLP): The objective here is to recover your costs and gain publicity and market share.

Value-based pricing: Often used by high-end software companies, the idea is to pitch the price around the products’ value to the customer, in terms of benefits received.

Yield management pricing: Yield management entails variable pricing used by airlines and hotels where they have to sell the seat in the plane / the hotel room on any given day or that opportunity has gone forever. The challenge is that two airline travelers can be sitting next to each other on a flight and discover that they have paid different prices. How would this make you feel if you had paid the higher price? (This is known as price discrimination, by the way).

Service pricing strategies

If you are wondering how to price your services, then you are in need of a service pricing strategy. A service pricing strategy can be closely related to, but not the same as all of the other pricing strategies about products. Simply put, there is a great difference in how to price your product and how to price your services.

For this purpose, we went ahead and asked other professionals to explain the best ways of how to charge customers for services.

Let’s take a look at these proven service pricing strategies.

Standard strategy

There’s a standard formula for how to price your services. Overhead and labor costs + profit you wish to earn then divide that to the total work hours. For example, you’re offering cleaning services. Add the costs of the supplies, equipment, and workforce salary. Then add the profit you would want from the different kinds of services you will offer. Then, divide the total time the service will be done. 

You’ll get the hourly rate that you’d want to ask for your services. If you’ll be asking for a one-time payment for the service, just do the same thing. But this time, you’ll divide the sum by the total work hours to determine if the hourly rate is reasonable. And that’s it, now you know how to charge customers for services.

Michael Humphreys, Founder & CEO of Z Grills Australia

A step-by-step strategy

Effective pricing strategy has to start with the basics. Here are the steps and information we need to gather before determining any adjustments we do on our pricing strategy:

Market Research – You need to understand how customers perceive your business. Don’t ask yourself how much should I charge for my services until you figure out that. You won’t make money if customers are not willing to pay. There are many market research methods for small businesses, but also other resources and tools that can help your business no matter its size.

Benefits – Identify the benefits your service offers customers.

Demand – Determine the demand for your product/service.

Costing – Identify the costs for producing, distributing, and selling your product/service.

Competition – Check your competitor’s pricing and based on that make certain changes on how to charge customers for services. If you charge more than your competition, show customers the value of the unique experience your company offers.

Fair Pricing – If you quote too low, however, you risk missing out on profits, or you may even have to sacrifice the quality of work you do to meet your price. If you quote too high, there is the chance of losing a contract or client. Don’t sell yourself short and be afraid to ask for what you think you deserve.

Chris Von Wilpert, Founder of Content Mavericks

Hourly rate strategy

When working out how to charge customers for services, always look at how much you want to be earning, monthly or yearly. Say you want to earn 200k a year, that’s an average of $16,700/mth. Then break down how many hours you want to work. If you want no more than 20 hours a week, 80 a month, your hourly rate starts at $210. From there you can craft your package to reach your goals. Make sure to ask your customers upfront if the price is alright with them because you don’t want to end up with a client who refuses to pay.

But my best advice would be to always make sure you’re confident in the rate you’re asking for. If you looked at this and thought, that’s too low, raise it. If you’re not confident asking for your rate, it’ll show and you’ll struggle to sell.

Felly Day, CEO of Felly Day VA

The 10 price level strategy

I’m assuming your service resource is you, and hence your capacity is limited. Also, I think that you don’t have a considerable variable cost per sale. You could try the following three simple steps to figure out how to price your services accurately:

  1. Create ten price levels (bands) from the lowest (level 1) to the highest (grade 10.) Push both limits to the extreme.

     

  2. Decide on a suitable booking period, depending on how long your service takes to fulfill. You could take an average service and multiply it by 30, meaning that if your service typically takes a day to perform, your booking period becomes one month.

     

  3. Start by offering your service at price level 3, and closely monitor your capacity utilization (percentage of booking period booked.) Once utilization breaks 40%, start selling at level 4. When it fails 50%, start selling at level 5 and so on. If, after a while, you find you never get higher than level 5 or 6, then you could start selling at level 1 or 2. If you find yourself often sold out, start your booking period price at level 5 or higher.

This way, you maximize revenues and profit, similar to how airlines and hotels do. If you prefer not to keep changing the price, you could fix your price at the level which on average yields the highest revenue per available service period.

Danny Bluestone, CEO of Cyber-Duck

Conclusion

We think that by now you figured out by yourself that the pricing strategy is a key element to your Business Plan. You may offer the most exquisite service or have the best product in the market, a stellar team by your side or/and a delicately put together digital marketing strategy but at the end of the day if don’t manage to price your product/service effectively – your sales will plummet and with them, your business will too.

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