What's the best pricing strategy?

[Arwyn Quandry]

I recently listed my first item for sale on MP and had to have a good think over how to price it. I knew the price point I wanted, but had wiggle room within it. Did I set it at 100? 99? 90? I kept thinking over what the most compelling price would be on a psychological level. IRL, businesses will often price at points like 6.95 or 6.99, because it's nearly to the next dollar without giving customers the ick feeling of seeing that dollar place number change to a 7.

Do you think the same principle applies in SL, where price points like $499 or 495 are the most compelling for customers, or do you see more success with round numbers like 250 or 100, or another price?

[Polenth Yue]

The 99 instead of 100 thing isn't as common in Second Life. I personally find it annoying, so I don't price things that way.

[Flea Yatsenko]

The most important thing is finding the range for optimal income. If it's priced too low, you'll sell a lot and not make a lot of L$. Priced too high and you won't sell a lot and you won't make as much as you could either. I don't think the 99 or 95 or 00 thing matters nearly as much as finding the sweet spot. But it takes time, it usually takes a month or so for a product to work its way through search and be discovered if I don't do any advertising.

Prices of products can range wildly from completely out of control to being given away basically for free. The SLMP economy is very unique compared to the RL one. Some people value their time making products and want to charge a fair price, some think their time is worth more than it is, and some think it isn't worth enough. I've seen a general rule and it's about L$250 per hour or work assuming you are working at a pretty good pace. I always end up way below that though.

[Blush Bravin]

Taking a look at my shop, apparently I have no rhyme or reason for how I price things. But I've been having a shop for so long that I'm not even sure how I picked 195L for some products while 200L for others. The one thing I do do though, is ask myself how much would I be happy to pay for this product. I've never asked how much do I want to make on this product or calculate the cost to me to make a product. It's always been if I were standing here looking at my product what price would make me say .. oh that's a good price, I can't pass that up. And it's because I set my prices as such to begin with that I never have markdown sales.