Questions

I'm planning to launch an ecommerce site selling art prints on fine art paper, canvas, tech and fashion accessories. But whereas bigger websites work with thousands of artists, I'll focus on a very specific niche of artists. Because of the size of my business (small, self-financed and bootstrapped), I'm not able to have production costs as low as the bigger sites. Is the fact that I'm niche enough to justify the higher prices? What else could I do to bring more value to my offering without lowering the prices?

Being a niche is not enough to justify your prices. You need to also consider the follow:
1. Are you niche enough? Sometimes we think we have a niche, but we really don't.
2. Who is your perfect customer? Some experts refer to this as your avatar. Remember, one main characteristic of your perfect customer is he/she is willing and able to pay your prices.
3. Are you giving you customers what they want? If you are just doing what the big companies are already doing, but on a smaller scale, they don't need to go to you because what they want is already being offered by the big companies, AND at a cheaper price. What do your customers want that the big companies are not providing?
4. What are they paying for? What is it about your prints that distinguish them from the ones produced by other companies, and, thus, justify the higher price point?

Don't get too wrapped up in being small and bootstrapped. That is not the clients' problem, and will not be a reason a client will go to you. That is like saying I am charging more because my rental costs are high. This may be true, but it is not a justification, at least, in your customer's mind, to pay more. After all, why should they pay for your rent?

Therefore, you need to go over the questions I posed above, and be a detailed as possible with your analysis.

Over all, you must have a clear understanding of the value of your products because, in reality, clients may not really know what that is. They just know you offer prints, and Co. Biggy offers prints-now who has the cheapest price?

You may know that comparing you and Co, Biggy is like comparing apples and oranges. So, it is up to you to make sure you have clear answers to the above questions, and you are able to point out the value (again, the value is not that you are small and bootstrapped and need the money!) of your product that justifies the price.

I hope this was helpful.


Answered 8 years ago

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