When an inventor/businessman has translated an idea into a product. One of the most valuable questions is: “What should my price be?”.
There are many ways to answer this question:
- Price competitively relative to competition.
- Maximize growth with zero margin.
- Set a random margin.
- Price / Test / RePrice and repeat.
- Email/Coupon based polling.
Each of these methods has flaws in that the price is never set to methodically maximize profit given all the available information. By definition, only the optimal price can do this.
I will discuss each of these methods in future posts.