So many Zimbabweans are struggling financially – that is the sad reality. It is commonplace for many to not have definitive and consistent income streams. The unemployment rate is so high and the present environment has been crippling for most businesses. This is all that makes many Zimbabweans be price sensitive. Given how virtually all Zimbabweans fit that label it becomes important to consider that in pricing. If you are running a business or a startup you must pay close attention to this. In this article, I share with you tips for dealing with price-sensitive customers or markets.
Figure Out Exactly What They Want And Have That In Stock
Price-sensitive people tend to go for certain brands. In essence, they go for things that are typically cheaper than their counterparts. In most cases, it can even be unpopular brands that might not be top-notch. As a business person, you must factor in that to lure them. If you do not provide exactly what they can afford you will lose them. I have noticed that people are willing to travel even 40 or so kilometres away just to find cheaper options. So your task as a business is to find out the products people prefer the most given their price point. The great thing is that it is easy to figure out all this if you survey sorts. You can find out from your peers, strike conversations with random people, or even tag along and go to places these people flock for cheaper alternatives.
Distinguish Yourself Through The Use Of Price Variations
Once you have done that the next thing is to play around with your pricing. Normally in any catchment, you will find prices of goods or services priced in a standard manner. For example, you will find a crate of eggs going for a particular price across the board e.g. US$4. To impress and lure price-sensitive customers you can reduce it a little. Changing it to US$3.50 can make all the difference and distinguish you from the competition.
I have two buddies who recently started running a supermarket business. They have been using this principle because their target market is extremely price sensitive. For this, to work you have to get smart about where you order your stocks. If you can find stuff at cheaper prices it becomes easier to be flexible in your pricing. Price sensitive people just want something cheaper even if it is US$0.10 or ZWL$10 cheaper.
Use The Principle Of Innumeracy
I have covered this principle before but let me share a bit on it again. Innumeracy is defined as ignorance of mathematics or an inability to manipulate numbers. This is leveraged in what is termed psychology pricing. This is something you should use when dealing with price-sensitive customers. The idea is to trick them into buying what appears cheaper. There are countless in which you can use innumeracy to appeal to price-sensitive customers. Ideally, such customers want more for less – that is what you capitalize on. You come up with packages that make them pay less for more; that is the general approach.
To take it further you make them pay what appears more for less. For example, let us suppose a product cost ZWL$17.95. You can then add another option of buying 4 for ZWL$72. They would think that buying 4 at once is a cheaper bargain whereas it is not. Big supermarkets use this innumeracy principle so do not understand how effective it can be. However, some people can see right through the strategy so it will not work on some customers.
The idea is to throw in some pricing or price packages that entail mathematical considerations. The probability is that a sizeable number of customers will fall for them. Why? This will be based on price-sensitive customers’ quest to pay less for more. At times they are so focused on just that that they even settle for illusions of paying less for more.
Run Promotions And Specials
A price-sensitive customer wants to get more for less – that is their working principle. This means you can appeal to them buying incentivising them to make purchases. You can run promotions that have prospects of winning something. Such customers can even go as far as ignoring pricing simply because they stand to win something. The same goes for specials which can come in several different forms e.g. discounts. If there are segments of customers that are so big on entering promotions, going for specials, and the like it is the price-sensitive ones.
These are some of the tips you can use in dealing with price-sensitive customers. They are an interesting bunch to deal with and so much value can be drawn from them. With such customers, you will realize the importance of being in touch with your customers. You need to always engage them to solicit feedback. They are also easy to turn into free marketing because they have a high susceptibility to tell others. Just as long as you are serving their price-sensitive needs they will spread the word. It is usually the small or little things that count – that holds particularly true with price-sensitive customers.