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Old 25th January 2011, 10:38 AM   #1
Humerus
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Default Debating On Lowering My Price

HELLO!

I'm brand new and I just found this forum... I have been looking for a place I can bounce business ideas off people who are not partial to me! So if you will forgive me I will jump right in with a question that has been on my mind for quite some time.

I operate a small company that sells reusable travel mugs and those clear acrylic insulated tumblers with a straw (Starbucks sells them too, but they are always sold out). I do mine with funny sayings about coffee (Coffee addict, morning without coffee is like sleep, a coffee ransom note) and some pop culture themes like from Twilight (Team Jacob & Edward), Princess Bride, Captain Jack Sparrow, etc.

My cups sell really well... in person. Online? Not one single sale. I've been trying to market them online for a few months now and I'm getting hits but no sales. But then my hubby packed off another cup this morning for yet another co-worker who saw his and just HAD to have one.

So I am considering lowering my price. I'm priced at where my competition is, roughly, but I guess the main issue is that the cups cost about another $5 to ship which is about 30% of the price itself! I'm getting hits to the store, I've been able to increase my followers on Facebook, and just today announced the winners of a giveaway that I decided to do. I think it was a success... but I still haven't sold any online.

I'm sorry about the BOOK I am writing! Just really trying to debate this.

Anyway so here's the numbers. Because I'm a startup, my costs per cup are relatively high because I do not yet purchase in volume. My overhead costs are very minimal since I run it out of my office in my home, though.

The cups are priced at $12.99 right now, and again cost about $20 to ship. My main competitor is Vessel Drinkware and theirs are priced at $13.99, and Starbucks prices theirs at $12.95 but they are almost always out of stock and people are selling them on eBay for up to $20 apiece.

So, what do you think? I get hits but no buyers on my website. My website is at http://humeruswares.com.

I really think that the shipping cost is the killer here - $5 to ship a $13 product is a lot. People snatch them up at shows, but I really hate doing shows and my family hates when I do them, so I really would like to get more online sales. I could potentially lower the price to $9.99, and I am thinking about doing that temporarily, but then there's the perceived value - these cups are very high quality and I don't want people to see them as "cheap."

Or, as opposed to lowering the price to $9.99, I guess I could keep the price the same and offer $1 shipping or something? That would essentially be the same since my out of pocket cost for the shipping would bring the profit level down to $9.99 per cup.

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Old 25th January 2011, 01:13 PM   #2
David Jackson
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Your prices are competitive. Do not lower your prices. The main problem I see is the design of your website. Your site is very poorly designed. If you're selling reuseable travel mugs, then that's the first thing people should see when they land on your website...big, bold, beautiful color pictures of your product. Everything else is secondary.

Here's an example of what I'm talking about. It's a simple design, but it works.

Another problem I see is your cost to obtain the product. I just don't see how you can make any real money, unless you lower your costs to obtain the product. That means having the ability to buy in bulk.

And last but not least, you really need to learn how to market your product. You need to be able to effectively explain to people why they should buy your product over your competitors.

Unless you can come up with some kind of unique slant or angle, you will not be successful. In that regard, I highly recommend you read Street Smart Internet Marketing by Justin Michie.

You can pick it up on Amazon for about $10.

David Jackson

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Last edited by David Jackson; 25th January 2011 at 01:17 PM.
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Old 25th January 2011, 02:54 PM   #3
Humerus
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David - you made me sigh... this is exactly the sort of feedback I need.

My online store itself is hosted at ecrater, and then the .com site is a separate site. I don't like having it that way, but I don't have the cash to pay a designer $500+ for a site. I've been considering a Shopify store which I think might be nicer... do you have thoughts on those?

As far as the product cost, there's not a whole lot I can do... I had the choice when investing in the inventory whether I should go for variety or get a better per-item price by doing larger orders but only one or two designs.

I opted with taking a profit margin hit initially by doing minimum piece orders of multiple designs, which was confirmed as a good thing at some of the shows I've done. I'm still making profit, and would actually still make profit if I only sold them for $10 but I still think that's underpricing myself as far as what market standard is for these items.

You are absolutely right though I think one of my biggest problems is I don't know which marketing angle is best. On one hand, I could take the eco-friendly cup angle, and on the other hand I could market them sort of individually based on the design itself. One way has more competition but more buyers... other has less competition but less buyers also. I've gone back and forth on it quite a bit.

Word of mouth has been doing phenomenally for me so I know people love what I have... but I can't figure out how to get the word out online. People are willing to pay ridiculous ebay prices for the sold-out Starbucks versions of these cups, but they aren't thinking that these cups are available anywhere else so there isn't much search volume for this particular type of cup.

I think I'll pick up that book... my birthday is coming up in a couple weeks...

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