Do you know your price point in your market?

Our guest blog this week is from Barrie Tynemouth.

Earlier this week I went to the local barbers which had opened about 7 years previously, run by two local lads one of whose Italian grandfather had originally owned and worked in the barber shop many years before. Chatting with the chap cutting your hair, as you do, about the state of the universe, I asked casually how business was; he said that things were ok, but his business partner was scared about losing customers by putting their prices up, even though the prices were the same as they had been since they opened the shop 7 years ago.

So, being the curious pricing type I am, I asked:

Did they know how much the barbers / hairdressers in the area charged? – No.

Did they know why their regular customers kept coming to them? – No.

Had they asked their customers about why they had changed from other barbers / hairdressers? – No.

Who did they think their main competitor was? – Not sure, but possibly the shop they had both left when they set up their own business.

They didn’t, but did they know which salons offered coffees/teas and biscuits with a haircut? – No.

I suggested that maybe answering some of these questions may help in the decision on whether to raise prices or not, otherwise they were totally blind and his business partner was right to be scared of losing customers! Also as they had their customer in the chair they were ideally placed with a captive audience to perform some cutting edge primary market research!

I did let them know the reason I went there was because I am lazy and have been going there since they opened as they are the closest barbers to our house, they hadn’t messed up my hair, provided some good local football banter and as I didn’t  know the prices at the salons around the corner on the High St either, I guess I am not in the price sensitive segment.

I’ll probably find out how successful my “off the cuff” suggestions were if I come back next time from the barbers with a post-apocalyptic purple punk Mohican!

So:

Do you know

  • if your products are priced correctly for your market?
  • what are your competitors are charging and for what offering?
  • why your customers value the services you provide?

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