The price for a month of Disney+ streaming changed from $10.99 to $13.99, on October 12, 2023 (source).
That’s an increase of almost 40%, in one go!
Disney’s announcement came after Netflix announced a smaller increase, so their decision did not happen in a vacuum.
That begs the question – how do you decide the price of your product or service?
Here are some things to consider as you finalize your pricing strategy:
- Market research: Talk with potential end users of your product or service to find out if they think your proposed price is reasonable
- Supply vs. demand: If supply is short, you can charge more. If the market is flooded, you have to charge less.
- Positioning: Look at where your offering is compared to your competition. Are you at the high or low end of the market?
- Pricing: What do your competitors charge for a similar product or service?
- Differentiation: What is your unique selling proposition that sets you apart from your competition?
- Service offerings: Be sure to factor in your hourly rate.
- Product offerings: Factor in your end-to-end production costs.
- Varying market demand: Demand will vary, so cover your costs enough to make up for the low times.
- Intangibles: Factor in the amounts you pay for rent, utilities, insurance, legal fees, and so on.
- Amortization: Figure out how long it will take to pay the development costs.
- Cover your assets: Include possible legal fees needed to protect your product or service, including intellectual property and copyright fees.
Value is important. But people will only pay what they think something is worth.
Let us know if you’d like help to strategize the best price for your product or service. We’d love to assist!