You may think that lower prices are always a good thing. After all, aren’t your customers looking for a deal? If you can offer them the cheapest drinks, doesn’t it follow that you’ll have customers to flocking to your bar?
Not necessarily! The truth is, lower prices aren’t always better for business. In fact, you might find that you can absolutely charge higher prices without turning away any customers. But how? Read on to find out about the strategies some bars are using to increase prices—and then you might want to do the same thing!
Focus on quality.
Yes, there will always be customers who are just after the cheapest beer you can sell them. But, when you focus on high quality, you’ll be able to raise prices and your customers won’t even blink. For example, restaurants in the fast-casual category are able to raise prices because customers expect to receive high quality meals. If you can deliver drinks that are better than your competitors’, a price increase is probably justified.
Price increases might make you nervous. If so, try adding some value by bundling items together and raising the price overall. For example, you might offer a beer and an appetizer together for a set price that’s slightly higher than your old one.
Include some alternatives.
If you increase the price of your burger, you might be worried that it will seem too expensive to customers. However, if you put a much more expensive menu item right next to it (say, a steak), that burger no longer seems quite so expensive. A little bit of comparison might just convince customers to take the plunge.
Try out the number 9.
It sounds crazy, but studies have shown that ending prices with the number 9 can increase sales. In fact, one study showed that a $39 item of clothing was able to outsell a $34 article of clothing by 24%! Whatever power the number 9 has, it can convince some customers to spend more money.
Think about positioning.
Sure, lower prices can attract lots of customers—but what types of customers are you getting? When you raise prices (and focus on quality), you’ll be bringing in customers who are able to spend more…and these customers can help your sales a lot more in the long run. It’s important to consider your image and your desired clientele when you’re raising prices.
Throw out what you think you know about pricing—cheaper isn’t always better! Try out a few of these tactics for raising prices and see if your sales increase!