Yes…yes they can. I was recently shopping for a new camcorder. The retail value of the one I had in mind was $1,200. My goal was to get it for $500 lightly used. On one site I found my choice, the Canon HV20 for $369…what was my first thought? “Wow, hook me up with that” or “What’s the catch…is it made out of used pinball machine parts?” Sure enough, after a little research this website was famous for selling you something for super cheap and then refusing to ship it unless you were successfully upsold to a variety of different accessories…all with high markups.
Recently, a project of mine was faced with small margins that left it little room for growth. Over the course of many months however, prices for this product soared, leaving me the opportunity to almost double my prices while maintaining the niche I had of being the affordable solution. The result? Order volume stayed level, leaving me with an huge jump in revenue and the ability to put a lot more into marketing and advertising to foster some growth.
The lesson? If I would have kept my prices where they were before, what would have been the thoughts of people doing some comparison shopping? It could have been, “wow, what a great deal”, but at the same time, they could have felt my product was either inferior…or just too good to be true.
