The Placebo Effect … on Pricing
OK, so here's an interesting dilemma for many businesses out there, including us here at IPOWER.
I just read this fascinating article from The Washington Post on "The Price-Placebo Effect." Most people understand the Placebo Effect as it pertains to medication studies: "control" participants are blindly administered a sugar pill instead of actual medication, and yet still experience improved symptoms, probably as a result of their belief that they have received real medication.
The Price-Placebo Effect takes the same tack, but instead of medication being the agent of change, price is strangely the culprit. The Price-Placebo Effect, according to the article, is basically the notion that people experience more pleasure (i.e. larger activation in their medial orbitofrontal cortex) when they consume a product that they pay a higher price for, compared to those who pay a less-expensive price.
While the article leads off referencing the uncomfortable Eliot Spitzer scandal, the more relevant story revolves around a study in which two groups of participants were asked to drink some wine: one group from a bottle priced at $90, and the other group from a bottle priced at $10. The participants who drank the $90 bottle not only indicated an overall higher level of enjoyment (as to be expected), but they also had experienced more activity medial orbitofrontal cortex than those who drank the $10 bottle. The catch? They drank the exact same wine.
So what does this tell us about pricing our products? Well, for one thing, Apple's got it right. The price of their notebooks is significantly higher than it needs to be, and yet they don't have much trouble (a) selling them like hotcakes or (b) cultivating a dedicated (some might say fanatic?) userbase. In fact, it wasn't until the end of last year that they even contemplated releasing a notebook under $1000. So what's the story here? Great products justifying expensive prices? People paying for the "brand"? Or is there something actually physiological going on?
It's tough to say, but notions like these definitely make us think about our strategies. The webhosting industry is a complicated one--commodization is driving prices down and requiring hosts to underprice their services. Two years ago it was ludicrous to advertise a price under $6/month. Now that price is considered expensive. And yet does our catering to the competitive nature of the hosting market mean our product is any less valuable to consumers than it was two years ago? In fact, no--our product is constantly improving and evolving and a hosting plan now is "worth" more than ever. It would be great to price our plans to invoke the "Price-Placebo Effect," but unfortunately, the likely result would be potential customers hammering the "Back" button as soon as the images start to load on IPOWER.com.
So how do we tap into this pricing enigma? Have you tapped into it?
Online Sales Down So Far this Year? Don’t Fret
comScore released a report today indicating that up until Cyber Monday (which was this past Monday, Dec. 1st), e-commerce sales had been down by about 2% compared to November last year. However, probably due to holiday sale prices many online retailers tout during the post-Thanksgiving shopping frenzy, Monday yielded a 15% jump over last year's Cyber Monday sales.
Additional key findings from the report include:
* Overall, retailers appear to be giving more aggressive discounts this year in an effort to encourage consumer spending; 51% of consumers surveyed indicated that the number of discounts and promotions seem higher this year than last year (compared to 12% who thought discounts were fewer).
* 39% of those surveyed indicated they felt the crowds at retail stores were fewer this year than last year, whereas 7% felt the number had increased.
Of course this is great news for our e-commerce customers here at IPOWERWEB. We truly hope your online sales end up following the post-Thanksgiving trend reported by comScore! Check out today's press release for more details on the report.
And at the risk of irritating some of our readers with an upsell, if you haven't already, it might be a good time to take advantage of a couple of the discounts *we're* offering for e-commerce-izing your site .... If this annoys you, feel free to skip the following bullets 
* CM4all E-commerce is available for 1/2 price off your first term (month, quarter, year) through Dec. 18.
* Existing ShopSite customers can take advantage of 1/2 price off their first quarter or year for ShopSite Manager or Pro (call us for details: 888-511-4678).
* PowerPay (our preferred credit card processing partner) is now offering the Authorize.Net Fraud Detection Suite--included with your payment gateway solution.
Okay--you can open your eyes again.
Want to Improve Search Engine Visibility? 15 Tips
If you use your website to get noticed--whether on a business-related or personal level--then chances are you're looking to increase your search engine visibility. I came across an article today in my Google Reader that outlines 15 solid tips for doing just that.
Written by social media marketer Mike Fruchter, this article is immensely helpful in outlining some key methods to getting search engines to "like" your site. And if you like what you read, I highly recommend following Mike's blog (or perhaps Louis Gray's, where the article was written) for more tips on social media marketing, or tech stuff in general.
So, without further ado:
http://www.louisgray.com/live/2008/11/15-tips-on-improving-search-engine.html
Have a Message That Sticks
We all have heard songs that just can’t leave our head. You know what we are talking about, that chorus that just sticks with us for hours (maybe even days). Such songs may seem annoying, but they do a wonderful job in getting a certain thing stuck in your head. When marketing your business and web site you should think the same way. You should work to spread your message and get your story stuck to the minds of your potential users. Great marketing and ideas are able to stick in the heads of consumers, don’t forget this. Next time you are strategizing your marketing initiatives – make sure what you do sticks.
Make Money Via Your Web Site
Making money over the Internet may be easy for some people and difficult for others. If you have a web site, you can actually make money without doing anything. All that you need to know is setup a Google AdSense account and allow Google to run ads on your web site. Every time a user clicks on your ads, you will receive money from AdSense. The more people that click on your ads - the more money you make. In theory this means that if you are able to drive tons of traffic to your web site you should be able to get tons of clicks, which will lead to lots of money. Google AdSense is a great program to earn money via your web site and if you own a web site, definitely consider it. You control where the ads go and can stop serving Google ads at any time.
Target the Right People
In many cases it is not best to have a marketing campaign that is intended for all people of the world regardless of age, sex, religion, and color. Rather than trying to get the attention of every single person, you as an Internet marketer should try to tailor your marketing campaigns to reach those who actually would consider your product/service. For example, it does not make sense to market foods for infants to 12 year old boys (at least in most cases). Instead a marketing campaign for a company that sells food for infants should be targeted to the people who actually purchase the food, parents. This may seem quite obvious but when marketing your web site, you should never forget this. Too many people try to be the perfect company for every person in the world and in most cases this model fails. Therefore next time you discuss and implement your next marketing campaign, make sure to target the right people. Always remember that the more people you reach the more likely you are to reach the wrong people.
Best Marketing: Word of Mouth
A company can spend millions on advertising and not do as well as a company that virtually spends zero money on advertising. Rather the successful company focuses on operating the best company possible and in turn if its users are satisfied, the users will do the marketing for the company. If you are hosting your web site with an excellent web hosting provider, in many cases you will recommend that hosting provider to people you know who are searching for a new host.
Give Stuff For Free
We are all consumers and we know one thing for sure: People love to get things for free.
If you own a business and are thinking of ways to spread your message or have people test your new or improved products, free giveaways are always great. Not only do more people get to use your product and experience it but free giveaways create buzz and buzz is good. People love free and you should never forget this. Having giveaways, coupons, trial versions, etc. make people happy - Take Advantage of This.
First Is Not Always Best
May people assume that the first company to offer some sort of product of service will generally always be more successful when compared to similar companies that will follow. You must remember one thing, being first is not always best. You can still be very successful (in many cases even more successful than the first) if you build off what other companies do and make it "better". When thinking of a new idea or product you wish to launch, don't be scared of a certian business because other people already do it. There is always room for a new company and hopefully in your case, an even better company. As we always say, hard work will bring success.
If you find a certain product or service that needs some help and you feel you can make it better, do it. Just because there are other companies out there it doesn't mean the opportunity for you to grow is not existent.
The point is, if you feel that something is missing - introduce it to the world. The Internet will allow you to reach people all over the globe. Your unique product along with your outstanding web site hosted by IPOWERWEB will make you a force to be reckoned with.
When trying to be innovative, don't forget to think about how you can improve products and services people use on a regular basis. A wonderful example of this is Google. Google was surely not the first search engine on the Internet, although we can surely say that Google is the best out there by far. Along with Google, another company that was not first but has grown to become one of the best is IPOWERWEB. We were not the first web hosting company on the Internet, although we have grown to become one of the best. We realized that getting your web site on the Internet was not affordable and the market was filled with companies not focused on customer service.
In 2001, IPOWERWEB entered the web hosting industry and web hosting has never been the same. In a little over than 6 years in business IPOWERWEB hosts over 700,000 web sites and we highly value every one of our users. Our dedication to our users along with wonderful products at an affordable price has helped us succeed and change the web hosting industry forever. Remember, first is not always best.
The Importance of Weekdays
If you own a web business you may have noticed something odd since your first day in business, most traffic and business comes on weekdays rather than weekends. Traditionally many of us think that weekends are the days to make money over the Internet because most people are off from work and have time to do their shopping.