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Tara Chester

How to price an item

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Beside those all-know rules like price category, supply and demand and "99", does anyone care to share some trade secrets and advices on this topic? Customers opinions are also welcome.Thanks.

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The average inworld purchase (as reported by the Lindens) is, as I recall, about 318L$.

You can price an item too high. You can also price an item too low. If the price seems too good to be true, people often will assume it's either worthless, or stolen.

49, 99, 149, etc.. isn't really all that effective in SL. People in SL really do seem to appreciate simple, round numbers. 500 is as good as 499... maybe even better, cause it doesn't look like you're trying to trick them.

demos may be 0L, or 1L. no more.

Textures, generally speaking, should cost about 10-30L$ each. (I really won't pay more than that). "low" framed art (movie posters and such) should be 10L, no more. (any more, and the customer realizes they could just find the same image on the web, and upload it themselves). Prefabricated sculpts are all over the map in terms of pricing, but most "packs" seem to settle into the 500-1000L$ price range.

AO's top out at 1000L$.. and do extremely well at much lower amounts. One of the most popular animation sellers these days is Oracul in Kuso.. and their AO's generally go for 150-300L$, with animations selling individually quite cheap.

Generally speaking.. look at what other people sell similar items for. Check the "big name" stores especially. Then compare your products honestly to theirs.. what are your product's strengths and weaknesses? then adjust the prices accordingly. Try to keep your prices competetive, and remember that you don't need to make back all your time and effort in the first sale. A good, accessible price can get your more money in the long term than a high price that only a few can afford.

Oh, and print your prices on your vendors. Please.

 

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A consumer's viewpoint:

If it's a purchase of convenience and the product was easy to find and receive delivery, I don't mind paying extra. Yes, that same box of mega prims is free at about 5,000 inworld locations but my friend was afk for less than a minute and we were able to continue working.

I have purchased some Art work. The price is usually whatever the Artist wants. Only after a person tries to arrange furniture or texture walls might they realize that it is a skill.

I think reasonable profit is the ability to work at what you love in exchange for the type and quantity of wealth you desire, to allow for the progression of a common goal, be it linear or nonlinear.

Statements in a Merchants profile can discourage potential sales.

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I always try to price competatively and it seems to work.

I usually compare the item to others that are already for sale that are similar and make note of the features and differences and price according to that.

You are free to price any item at any price, but my formula enables me to live from what i make.

 

Cait

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Winter Ventura wrote:

"49, 99, 149, etc.. isn't really all that effective in SL. People in SL really do seem to appreciate simple, round numbers. 500 is as good as 499... maybe even better, cause it doesn't look like you're trying to trick them.

demos may be 0L, or 1L. no more."


It can come across as odd or a trick, but, I'd expect the person selling at a n9 price to offer a demo at 1L to round off the complete transaction process (149 + 1). In doing so if I check a demo or two and end up purchacing a number of products above the number of demos I'd actually end up saving additional 1L's for further demos either there or elsewhere.

Occasionally what seems a trick turns out to be blessing.

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I used to look at others, see what they put for similar items, but one asks way more than another, simply cos one doesn't have an inworld store and the other does.

Now I just look at what my item features, if it has many features I'll ask more than for a more simple structure.

Also I prefer to keep my stuff affordable for everyone, when I was new to SL I couldn't afford anything but freebies, it would take ages before I gathered enough Lindens to get some decent clothes, etc.

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Also take into account your own overhead costs: uploading fees, for example, and your tier/rent for your shop.  You want to be making enough per sale that you don't have to make a couple thousand sales every week just to keep the roof over your head.

If the item you sell has copy permissions, bear in mind that when someone buys this object, they'll only be buying one of this object.  So it may be prudent to price it higher than a non-copy item.  This does not, however, apply to clothing.  Clothing should always be copy anyway.

Speaking as a consumer: please don't call something "free" when it's not.  One linden is not free.  Ten lindens is not free.  It's not that I mind paying that amount for an item; it's that there's a misrepresentation in being told something is free when it isn't.

Don't fall into the trap of offering your item at a cut rate, to undersell your competitors.  As was mentioned by someone else before, if you price your item too low, it devalues the item itself.  People expect cut-rate quality when they see a cut-rate price.  And, like I said at the beginning, if you price your item too low you'll have to sell lots more of it just to make your ends meet.

If you decide your item is at least as good as the competition-- or if your item as yet has no competition-- and you charge a reasonably high price, be sure you tell the customer what it is that makes your item the better choice.  Customers don't mind paying more, so long as they're confident that they're getting what they pay for.

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Apart from what you mentioned the most important factor we take in consideration while pricing is the time it took us to make the item. An item that only took four hours to make has a lower price then an item that took 20 hours. (In general my time spend on an item is more like 20 hours then like 4 hours.)

I also listen to customers what they have to say about our pricing. I have heard a few times that people think our items are expensive. And a few times I heard: cheap for the quality you deliver. But the most heard comment on this subject is: affordable, fair priced, good priced, the quality you make is really worth the money.

These comments reflect what we have in mind for our brand: high quality for a fair price. So actually we don't look anymore at how competitors in the same branche price their items. But when releasing new products we measure our time and compare it to the time it took to make the products we already have, and price it accordingly.

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When i price my items i look at other items by other creators. Usually they make nicer things, with better sculpty work and textures, so i try to be objective about it because i'm new at building sl content. It's a delicate line of trying to be humble but also not underpricing. Your work, time and love you put into the product has value. I also take into account the noobs who, like me, are usually broke and have to spend sad nights playing freeplay zyngo to get some lindens... I put myself in their shoes and think how i would feel paying X qty of lindens and receiving Y box. Thinking from the customers perspective is the way forward imho. Now, if your stuff is pro quality, then price according to the competition. Like the joker said, if you're good at something don't do it for free. If it's expensive, but really good quality, not even the noobs will shed a tear when they receive the box. Unless it's happy tears :)

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When I started selling my creations I priced them according to what I would be prepared to pay. I was a resident and customer in SL for a long time before I became a seller, and back then I always cringed when I saw anything that cost over L$1000. I thought really hard before buying so I could keep my hobby as inexpensive as possible. I know what it feels like to want something and see it as being too expensive so I price my items relatively low and always charge under L$1000.

I'm doing reasonably well,  so in my case customers don't think cheap = low value. Most of my customers see my items displayed somewhere in SL (I get told this all the time) and they click it to find creator then probably do a search in market or find my inworld store in my profile. When they find the item of interest it probably is a pleasant surprise to see it is very affordable.

I don't know how much better I'd be doing if I had priced my items higher, but I suspect not much better because higher prices also could mean less sales.

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You could look at what fellow merchants are doing but that won't help you understand the / your market. Tagging your items is all about the level of quality of your items and how exclusive you want your items to be.

For me, I am very expensive, my most expensive item is a castle and it will cost you 100K. I only want to sell to people who actually care about quality and uniqueness. I rather sell 5 houses a week for 15 K each then 50 houses for 1500 each. I want my customers to feel special and privileged.

Ami

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REALLY SO JUST FOR THE SAKE OF ARGUMENT HOW MANY OF THESE ONE HUNDRFED THOUSAND LINDEN HOUSES HAVE YOU SOLD *SNICKERS* QUALITY IS QUALITY AT ANY PRICE THEN AGAIN THERE IS SUCH A THING AS BEING STRAIGHT RIPPED OFF!! I WOULD ARGUABLY SAY FOUR HUNDRED AMERICAN DOLLARS IS A GOOD PORTION OR MOST OF PEOPLES RENT!

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@ Foxy...

If you make really good stuff here don't sell yourself too cheap :)

Something I've discovered over the years...there's lots of people roaming these sims who make 6 figure incomes...I'm not going to work for 2 dollars an hour for them !   Unfortunately, many have expected this because it's 'just a game'.

Of course many do not make in excess of 100,000 real dollars a year I know...pricing is not an easy thing to figure out.

I don't just consider time spent on each item...I consider the time it took me to develop my skills and/or purchase my software too.  Kind of like with a doctor...you don't pay them X amount for their labor for a 40 minute surgery....you pay them a lot for that 40 minutes because they know where to cut.

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So, when I put a 3 weeks of valuable work in a castle that I sell for 100K I am ripping p[eople off? Let me give you something to think about; Let's say I have put 200 hours into texturing and building the castle. Then there is all the hours that a merchant needs to spent marketing, designing, writing descriptions, managing blogs, managing sims, updating catalogs on the Marketplace and Hippo servers, etc.

Uhm, how many hours do you think a merchant needs per week? I can tell you, a lot! So, I would not talk that easy about people ripping other people off. Btw, it is the customer that buys who is in charge and decides if he or she is ripped off. None of my customers think that is the case. Strange huh?

Ami

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