Search
Related Links

 

 

Informative Articles

11 Success Tips to Home Based Internet Business
Let's face it everyone wants to succeed with their home based internet business ? But what does it takes to really succeed in cyberspace ? 1. Your first ultimate start must include written goals and plans. Formulate a plan of weekly...
Autoresponders = Automatic Internet Marketing Success
What if you could send out all the information that your potential customers have requested without checking your email or answering a phone? While this may seem impossible, it is becoming more and more popular among the most successful Internet...
Home Internet Business...How Do I Start?
Working from home and especially on the internet is fast becoming the preferred choice for many people worldwide, no longer are we tied down to our office desks and facing that daily Monday to Friday routine of rising early to beat the early morning...
How To Start An Internet Business – Site Layout
This step of how to start an Internet business involves the layout of your site. When organizing it, two audiences must be considered. Obviously, visitors to the site are the first audience. You must also keep in mind the second audience, search...
The Most Overlooked Internet Marketing Strategy
Avoid selfishness. It causes problems everywhere, and the e-biz world is no exception. To succeed, you must know your audience, care about them, and go the extra mile to meet them where they're at. Maybe you're brainstorming a new website: "My...
 
Is the Price Right? Pricing Strategies for Internet Businesses


You may have the greatest product/service in the world, but you won't get anywhere if it isn't priced properly. In this article, we'll explore various pricing strategies so that you can find the one that is best for your business.

Generally speaking, there are three primary pricing strategies Internet firms employ: POPS, CAPS, and VAPS. Each strategy is explored below. If properly implemented, these strategies can help firms under price their competitors while being just as profitable.

Physical Object Pricing Strategy (POPS). This pricing model works well if you are selling a physical good that needs to be shipped to your customer. For instance, merchants like Amazon.com and Wal-Mart fall into this category.

In order for such firms to determine their prices, they need to start with a base level of what it costs them to produce and deliver one additional unit (this number is known as the marginal cost). For instance, Wal-Mart sells microwave ovens. What does it cost them to produce an additional microwave oven? What does it cost them to buy it from their supplier, put it in their store, get the customer to come to the store, and execute a transaction with their customer?

To determine their final price, firms should add a percentage increase to the marginal cost. This percentage increase is known as the operating profit margin. To find out what percent they should use, they should look for similar firms, and try to price accordingly. Amazon, for instance, has an operating profit margin of 6% at the time of this writing. Competing retailers should look to have a similar operating profit margin -- preferably lower if they are able to.

KEY IDEA: Firms that can develop the most efficient business processes will be able to minimize their cost, which in turn will allow them to keep prices low while still retaining attractive margins. This will allow them to offer lower prices but still enjoy the same level of profitability.

Cost of Acquisition Pricing Strategy (CAPS). POPS works very well if your primary cost is the cost of the actual good that you are delivering. But firms that are selling a product/service where the primary cost is marketing-based --


meaning the costs associated with getting visitors to your site -- may benefit from utilizing CAPS to determine their final price. CAPS involves firms answering two key questions:

1. What will cost it to get people to my site?

2. What percentage of my site visitors will make a purchase?

The answer to question #1, divided by the answer to question #2, tells the firm its cost per acquisition. The operating profit margin can then be added to determine the final price.

Example: A retailer may find that on average it costs $0.10 to get a visitor to the site, and the percentage of site visitors that make a purchase is 1%. From there, we simply do the math: .10 / .01 = $10. With a cost per acquisition of $10 and assuming competitors have an operating profit margin of 20%, the final price should be set to $12.

KEY IDEA: The key here is obviously to minimize the cost per acquisition. To do this, firms need to place a high priority on increasing the percentage of visitors that make a purchase. The site's conversion rate is the most important metric.

Value Added Pricing Strategy (VAPS). For businesses in which the marginal cost is zero -- for instance, the sale of digital products like ebooks and online courses -- or businesses in which there is not much of an established precedent, VAPS can be an excellent pricing strategy. This is simply a more ad hoc strategy in which the good is priced based on how much value it offers to the consumer. There is no real formula to this strategy, which can be comforting or disturbing, depending on your preference.

KEY IDEA: VAPS works best when you can create a business model that allows you to charge a different price to different clients. For instance, if you are selling consultation services or customized products, you can offer your client a quote based on how much the product is worth to them.

About the Author

Simit Patel is the Managing Director of The ActoNetwork, a company devoted to helping small businesses succeed on the web. The ActoNetwork publishes a free 102 page Internet Marketing eBook and has a free Internet Marketing Workshop for online entrepreneurs available at http://www.actonetwork.com

 

Internet Marketing Center®
Tips and strategies for promoting a business online.
www.marketingtips.com
 
Best Selling Internet Marketing Course to explode your Profits ...
Internet Marketing Course. Finally, the world's Top Internet Marketer reveals exact strategies that will boost your online sales and explode your profits!
www.marketingtips.com
 
AddMe, Search Engine Optimization Submission Free Site Promotion ...
Increase site Traffic and sales BuyaWebsiteTraffic.com. Internet Marketing DM Confidential: serving online marketing industry. Promotion & Marketing ...
www.addme.com
 
Web Marketing Today -- E-Commerce, E-Mail, Internet Marketing, and ...
Articles, tips and advice on e-commerce and effective Internet marketing strategies.
www.wilsonweb.com
 
ClickZ Internet Marketing Solutions for Marketers
Includes columns with commentary and analysis on a wide variety of internet marketing subjects ranging from B2B marketing to search engine marketing.
www.clickz.com
 
Internet Marketing, Search Engine Marketing: Website Promotion ...
Internet Marketing and Search Engine Marketing; Website promotion and internet advertising services, Internet marketing services International marketing web ...
www.majon.com
 
KnowThis: For Marketing, Market Research, Internet Marketing ...
A virtual library containing information, resources, and reference for professionals, academics and students in traditional and internet marketing, ...
www.knowthis.com
 
Online Behavioral Contextual Advertising and Marketing.
An advertising network offers content targeted advertising service on CPC/PPC basis.
www.clicksor.com
 
Internet marketing - Wikipedia, the free encyclopedia
Internet marketing is also useful for companies that wish to expand their ... When Internet marketing first began, the B2C model was first to emerge. ...
en.wikipedia.org
 
Internet marketing - Wikipedia, the free encyclopedia
Internet marketing is the use of the Internet to advertise and sell goods and services. ... Internet marketing is a component of electronic commerce. ...
en.wikipedia.org
 
Marketing Terms.com - Internet Marketing Reference
Marketing and internet marketing terms, acronyms, course syllabi, and recommended links.
www.marketingterms.com
 
Internet Marketing Dictionary
The Internet marketing dictionary at Marketing Terms.com.
www.marketingterms.com
 
International Internet Marketing Association (IIMA)
Non-profit professional association serving Internet marketing professionals and business strategists.
www.iimaonline.org
 
Internet marketing and website marketing promotion services ...
Free Internet marketing eCourse, marketing articles, advice and internet marketing services from Magnet4web. The site includes reviews of leading internet ...
www.magnet4web.com
 
Internet Marketing - Craig Upton
Weblinx Limited delivers various internet marketing solutions that will enable a web site to carry out online marketing promotions.
www.weblinx.biz
 
Internet Marketing News from JDD Publishing's BizWeb eGazette
Free Internet marketing help and web site promotion tips for small and home based businesses.
www.bizweb2000.com
 
Search Engine Optimization, Website Submission and Free ...
Offers Free Website URL Registration in major search engines. Search Engine submission services and optimization tips for higher ranking.
www.addpro.com
 
Zeus 1000 Internet Marketing Robot
Zeus internet marketing robot generates thousands of reciprocal link trades by automatically finding web sites you train him to find.
www.cyber-robotics.com
 
Serious Internet Marketing Services. Link Building, Web Content ...
We are an Internet marketing services and link popularity company offering search engine optimization (SEO) services. If you are seeking link building ...
www.webuildpages.com
 
Marketing & SEO Blogs - Blog Top Sites
Business and Internet Marketing from a Montreal, Quebec, Canada perspective ... View Details for Gather Success - The Internet Marketing Blog ...
www.blogtopsites.com
 
 

 
Content Menu
  • 11 success tips to home based internet business

  • 1 best selling internet marketing course online

  • 3 business models for creating wealth on the internet

  • 3 easy money making internet business models

  • 3 internet home based businesses anyone can do

  • 3 simple ways to start your home based internet business right now

  • 5 concepts that you need to understand to successfully make money on the internet

  • 5 great benefits to writing articles on the internet

  • 5 hot internet businesses for 2005

  • 5 new internet marketing opportunities through rss

  • 5 reasons why you should choose an internet home based business

  • 5 things every internet marketer must learn from mail order to increase their profits now

  • 5 ways al quaeda is using internet marketing

  • 6 biggest internet marketing myths

  • 6 proven steps to internet marketing success

  • 7 lessons i learnt whilst losing thousands internet marketing

  • 7 questions to ask a potential internet merchant account provider

  • 7 quick tips for a more profitable internet business

  • 8 things i have learned as an internet marketer

  • 8 top tips for rapidly building a golden opt in list the key to internet riches

  • 9 great reasons to help an internet marketing newbie

  • a1 technology launches its independent seo division a 1 internetdesign

  • abcs for beginning internet business builders

  • adding profit to your work from home internet business

  • advantages disadvantages of internet marketing the good the bad and the ugly

  • affiliate marketing an excellent choice for your first home internet business

  • affiliate marketing diary posts of a budding internet entrepreneur

  • affiliate marketing programs make internet success a cinch

  • affiliate programs can be very beneficial to internet

  • affiliate program mastery learning how to build internet capital goods for free

  • affiliate program mastery learn how to build internet capital goods for free

  • after fifteen years or more of frustration with internet marketing i think ive found it

  • alexa toolbar the ultimate internet tool

  • all internet marketers how to get my business

  • an internet business is the business of the free

  • an internet marketing secret using tie downs to increase sales

  • an internet success story

  • are you considering an affiliate internet marketing program

  • are you profitable as an internet marketer

  • are you stuck in your internet mlm business

  • are you the next internet millionaire

  • arrgh those stupid internet marketing cliches are true

  • articles and internet branding 5 steps to success

  • article publishing is a key component of internet marketing

  • article writing seo expert authors and the dumbification of the internet

  • at home internet jobs who said it was easy

  • at last the real secret of internet marketing

  • automate your internet business for passive revenue in 5 easy steps

  • automatic internet marketing and business success on a 25 00 budget

  • autoresponders automatic internet marketing success

  • autoresponders the life blood of internet marketing success

  • a business guide for the very new internet entrepreneur

  • a few things ive learned about doing business on the internet

  • a internet marketing plan is crucial

  • a letter to santa from an internet marketer

  • become an internet marketing guru

  • before you do an internet business start up answer these 4 questions

  • begin an internet empire

  • believe that you can become a millionaire with your internet home business

  • best internet marketing solutions without overspending

  • blogging free internet marketing method

  • building a home internet business

  • build an internet parthenon part 1

  • build an internet parthenon part 2

  • business center on the internet

  • busted the real truth behind todays top 4 internet marketing myths

  • cash in on the internet quick or slow

  • comparison shopping and starting an internet business

  • confession of an internet marketing expert

  • consultants writing articles for the internet blankets the world with your expertise and style

  • creating your internet marketing plan

  • deadly effective ezine advertising for internet network marketing

  • developing your export import business using internet part i

  • did you ever wonder how the big boys in internet marketing build lists fast

  • dont be anonymous anymore 7 ways to use orange snowflakes to increase traffic and internet profits

  • dont get ripped off on the internet five tips for newbies

  • dont you sometimes wish it was easier to find quality free internet marketing tools

  • dos and donts for the internet marketing newbie part 1

  • dos and donts for the internet marketing newbie part 2

  • do it a guide to starting an internet business

  • do you know the reason why so many fail in internet business

  • dr robert anthony reveals how to use quantum physics to supercharge your internet marketing success

  • earn money online the best home based business on the internet

  • ecommerce communications and the global internet community

  • effective internet marketing strategy writing and submitting original articles

  • effective or irritating the use of pop windows in internet marketing

  • effective ways to build your mlm on the internet

  • email marketing affordable internet marketing technique

  • email marketing is still king of the internet

  • email marketing your internet business lifeline

  • empathy not internet traffic key to home based business success

  • experience the benefits of an internet business

  • fighting back with counter hypnotic internet marketing

  • finding the right internet marketing technique for you

  • five proven methods for internet marketing success

  • five tested and proven methods for internet success

  • five things to do to earn money on the internet

  • for internet success ignore these important principles at your peril

  • four models of successful internet business sites

  • four steps to eliminate frustration and turn your online failure into internet success

  • freedom through internet business

  • free internet advertising unwritten rules of internet forums

  • free internet business course 295 value

  • free internet marketing

  • free internet marketing methods that will save your internet business

  • free internet marketing part ii

  • free internet secrets that will instantly drive up your traffic and sales

  • from ordinary to extraordinary through internet networking

  • gas air and spark how internet marketing is like a cars engine

  • george bushs secret to successful internet marketing

  • getting a solid internet marketing foundation

  • get more than just a presence on the internet

  • grassroots internet marketing campaign

  • guide to internet business concept and opportunities

  • hitch a lift on an internet virus

  • home business opportunity abounds on the internet

  • home internet business how do i start

  • how direct marketing helps your internet business to prosper

  • how do i get my business on the internet

  • how do you live the internet dream automate automate automate

  • how internet marketeres can create their own powerful nicheeven in an over crowded industry

  • how i submitted my internet marketing articles to only 20 sites but within no time 16 000 other high traffic websites had also posted them

  • how my new internet business achieved truly explosive growth from a standing start in less than 6 weeks

  • how to avoid the top 5 time wasting activities in your internet mlm home business

  • how to become a top internet marketer

  • how to be an internet marketing champion

  • how to choose an internet marketing company

  • how to choose an internet marketing niche and quickly dominate it

  • how to choose an internet marketing strategy on a shoestring budget

  • how to design a website if youre a novice on the internet

  • how to find hot non internet marketing topics for your ebooks

  • how to find the best products on the internet

  • how to get the best shopping deals over the internet

  • how to guarantee your success in internet marketing

  • how to join the 5 of internet business real money making pros regardless of the products you sell

  • how to leverage the internet in mlm

  • how to make money from internet auctions

  • how to make money with your own internet business

  • how to make use of cheap internet banner advertising

  • how to start an internet business content content conten

  • how to start an internet business meta tags and keyword density

  • how to start an internet business site layout

  • how to start an internet business the first step

  • how to start a successful import business using the internet

  • how to use a podcast for internet marketing

  • how to use free articles to explode your internet business

  • how to use internet marketing promotion and advertising to build your business

  • if youre an internet marketer you should be blogging

  • implementing and opt in list to optimize your internet marketing success

  • implementing an opt in list to optimise your internet marketing success

  • implementing an opt in list to optimize your internet marketing success

  • index

  • internet and network marketing

  • internet and network marketing works

  • internet based network marketing success

  • internet business a common sense approach to succeed in internet business

  • internet business branding co branded

  • internet directories can help capture business for professionals

  • internet directory submission sure way to link popularity

  • internet direct mail is different 14 things to remember

  • internet freebies and cheapies to help you grow your business

  • internet marketers how to solve any problem in three minutes flat

  • internet marketing 10 little known upsell strategies that will magnify your profits

  • internet marketing and public speaking seven steps to a successful murder board

  • internet marketing and public speaking ten tips for when the twain shall meet

  • internet marketing and public speaking the murder board practice

  • internet marketing and your home based business

  • internet marketing a winning attitude and perseverance pays off

  • internet marketing basics what worked years ago still works today

  • internet marketing for frugal site owners

  • internet marketing for sales leads

  • internet marketing is dead

  • internet marketing is easy when you break down those defences

  • internet marketing is one huge oxymoron

  • internet marketing long term strategy

  • internet marketing on a budget

  • internet marketing reality check

  • internet marketing simplified 2 pillars for achieving massive results

  • internet marketing strategies setting up your affiliate program

  • internet marketing surviving the first year

  • internet marketing the importance of team work

  • internet marketing the most powerful lead generating device

  • internet marketing tips from a 10 year old

  • internet marketing with google post jagger methods

  • internet nostalgia remember this dumb little ad

  • internet partnerships dont throw away your business

  • internet promotion advantages and disadvantages

  • internet searching hits close to home

  • interview with corey rudl the secrets of an internet millionaire

  • is it still possible to make money on the internet

  • is the price right pricing strategies for internet businesses

  • is your online business internet law compliant

  • it really is only early days in the internet gold rush

  • keys to targeting your internet advertising

  • killer internet marketing errors how to avoid them

  • lead generation how to 10 tips on generating more internet sales leads

  • let site build it be your internet solution

  • looking for an affiliate internet marketing tip

  • low cost advertising and scams on the internet

  • low cost internet advertising solution versus conventional advertising

  • make internet marketing work for you via rss

  • making a living in south africa from the internet

  • marketing on the internet legal rules of the road

  • marketing your internet site 5 easy ways to drive traffic to your site

  • network marketing internet business basics

  • new ways to have success on the internet

  • one of the golden rules of internet marketing

  • online s tipped as internet marketing strategy for 2006

  • optimize your internet marketing success with an opt in list

  • optimizing your internet sales

  • paying too much for pro internet marketing tools

  • pixel advertisements redefine internet marketing to provide free traffic

  • practical information products for the internet

  • product marketing for internet based home businesses

  • publishing articles can be a very important part of an internet marketing program

  • read about ads all about internet advertising methods

  • relieving the internet marketing anxieties

  • reminisces of an aspiring internet marketer

  • residual income the secret to long term internet income

  • re evaluating internet marketing costs

  • rotator

  • save your cash avoid internet fast money scams

  • secrets of internet millionaires

  • secrets to business success on the internet

  • sell anything to anyone on the internet with hypnotic writing

  • seo a part of internet marketing strategy

  • so you want to advertise on the internet

  • speakers and trainers the internet is your biggest megaphone

  • starting an internet business is not for everyone

  • strategic internet marketing

  • strategic internet marketing is planning

  • strategic internet marketing using joint ventures

  • successful internet business panning for gold or selling shovels

  • successful internet marketing

  • summers internet traffic jam

  • ten steps towards a succesfull home business on the internet

  • the benefits of internet marketing

  • the best kept secret on the internet

  • the chicken or the egg and the internet marketer or site designer

  • the deadliest killer of an internet business and how to tackle it

  • the facts you should know about internet marketing

  • the internet and customer care aid or anarchy

  • the internet cash machine

  • the internet is great for home business

  • the internet marketing numbers game a myth

  • the key to a winning internet marketing strategy is to master one technique first

  • the most important step to gaining internet network marketing success

  • the most overlooked internet marketing strategy

  • the most successful internet marketing model start with free tools spend money later

  • the only traffic secret youll ever need for your internet marketing business

  • the quickest way to have a product to sell on the internet

  • the realistic way to start an internet business

  • the right internet marketing articles strategy is a game of links

  • the rss promise for internet users

  • the single most important aspect of internet marketing you must implement to succeed online

  • the struggling internet marketer

  • the upgrading power of internet marketing

  • three steps to internet success

  • time management the key to effective internet marketing

  • title home based internet business researching for niche markets

  • tool talk all about internet marketing tools

  • too many internet marketing experts

  • top 5 questions herbalife distributors should ask when buying internet leads

  • top internet marketing guru gives mini site creator rave review

  • top selling items on the internet

  • top ten basics on internet article writing to promote your book

  • top three internet marketing two tier affiliate programs

  • to all internet marketers how to get my business

  • tracking bears and internet marketing

  • trials of an internet entrepreneur a humorous beginning

  • two internet entrepreneurs launch new program that demystifies how to make money online

  • using internet direct mail to increase your companys profits

  • using internet marketing e books helps with business issues

  • warning five things every newbie in the internet marketing business should know

  • website ranking with an internet marketing specialist

  • weird sells get noticed on the internet

  • whats new on the internet scene

  • what a billionaire balloonist taught me about internet marketing

  • what can make you a fantastic internet marketeer

  • what do you really need to go into business on the internet

  • what internet etiquette net etiquette

  • what is internet marketing

  • what is the most profitable internet application

  • what i have learnt as a beginner in internet online business

  • what the internet owes me

  • what to sell on the internet

  • what you must know as an internet marketer

  • when internet marketing gurus sell their souls

  • who is making money on the internet

  • why is everybody but me making money on the internet

  • why post in forums to promote an internet business

  • why you can not afford to be shy on the internet

  • why you should care about internet marketing

  • why you should do business on the internet

  • writing articles as an affordable internet marketing method

  • your internet success system

  • you gotta think strategic internet marketing

  • you just created your own turnkey internet business now what

  • you know internet marketing is for you when