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Dangerous advise as you may end up painting yourself into a corner. There are lots and lots of cases where competitors have been in a niche for a long time and
by eps 10y ago
Dangerous advise as you may end up painting yourself into a corner.
There are lots and lots of cases where competitors have been in a niche for a long time and they now use aggressive discounting to experiment with (what's left of) customer acquisition. You price below them, you will die starving. Also, it is dramatically harder to raise prices than to lower them, so starting low and then increasing is a very painful thing to do.
- gingerlime 10y ago> Also, it is dramatically harder to raise prices than to lower them, so starting low and then increasing is a very painful thing to do. It depends on your perspective. When you're small and growing it's actually the opposite. If you grandfather your existing customers (ideally, indefinitely), then it's quite easy to raise prices. Assuming there is still demand at a higher price range, which in many cases there will be, since your product gains traction and improves over time (so you can also justify charging more). As your customer base grows, it's also harder to lower prices. Would you cut the cost of all your existing customer base? That immediately cuts into your recurring revenue, and you don't know if it's going to bring more customers to balance out over time.
- pbreit 10y agoIncumbents tend to spend the rest of their lives raising prices.