Letting customers set your price sounds crazy. But Radiohead made a $10 million success out of letting customers name their own price to download their album, In Rainbows. Others have experimented with this business model, too. Here is one of the most interesting twists I’ve read: let your loyal customers help you determine the right price point for you next release.
South African BLANKbottle has gone a step further. The boutique winemaker’s founder, Pieter Walser, sent 20 cases of its latest premium white wine Moment of Silenceto loyal customers on consignment, asking them to evaluate the wine and then pay him what they thought it was worth. They paid up to ZAR 90 per bottle (USD 11.80 / EUR 7.50), and the average price came to ZAR 50. Since BLANKbottle aims to exceed customers’ quality vs. price expectations, the wine went on sale to the public at a price of ZAR 40.
Walser, for his part, got a high return on the wine he risked in the venture. In addition to the publicity he garnered, he determined a new product’s price point based on the actual purchasing decisions made by the winery’s best customers. Feedback that’s likely to be more valuable than the opinions volunteered by focus groups or market research experts. And by involving them in such a fundamental business decision, he no doubt increased brand loyalty among the winery’s core customer base. One to try out with your own best customers!
Source: Springwise.
New to SmallBizSurvival.com? Take the Guided Tour. Like what you see? Get our updates.
- In an economic crisis, spend your brainpower before your dollars - November 25, 2020
- Video: How to fill empty car dealership buildings for the holidays - November 6, 2020
- How has 2020 changed the challenges rural small towns face? Tell us here - October 20, 2020
- The Idea Friendly Method to surviving a business crisis - October 6, 2020
- Join me for the Rural Renewal Symposium online Oct 13 - September 26, 2020
- Cheap placemaking idea: instant murals - September 11, 2020
- Refilling the rural business pipeline - July 7, 2020
- Huge vacant buildings: grants to renovate? - June 9, 2020
- Economic self defense for small towns - June 7, 2020
- The best things you can do for local businesses in light of coronavirus - March 27, 2020
What a hoot! I have been thinking about describing what I have to offer, stressing amenities and value, and asking what the next bargain hunter was willing to pay for that room package rather than offering a price for them to reject flat out. I can’t sell a room for less than I pay to heat it but it should be interesting to see what numbers potential guests come up with.
Instead of offering this to the general public, why not take the approach that the winemaker used: involve your most loyal fans.