Rise in US Consumer Prices: A Chance for a Smart Online Business Owner?

by | Apr 13, 2018 | Business Feature

As the latest reports state, consumer prices in the US have increased by 2.4% in March 2018 compared to the March 2017. The inflation rate in the country is highest in a year, which is not a very good situation for the consumer. However, this can be a chance for a clever online business owner to increase their customer base. With the price changes in many industries unfavorable to the buyer, one can try to increase their sales using various methods that will enable them to offer competitively low prices.

If one considers taking this chance, now is the time to do it as according to predictions from Statista, the US inflation rate will decline overall in 2018. However, due to the current trading deals with China as well as complex economic and political tensions on both federal and international levels, those predictions can’t be trusted. This lack of stability is another good motivator for using every opportunity for extra-profit available now.

How Can a Business Lower Its Prices in 2018?

It’s true that the inflation affects businesses the same way it does consumers. This makes finding ways to lower one’s prices extremely difficult as suppliers increase their rates and employees’ salaries also need to rise in response to inflation.

An online business owner is facing a more complex situation still. On one hand, these companies have fewer employees and expenses. On the other hand, they already operate at minimal prices as it’s one of their main attractions for the consumers. These business owners have to be clever and look for unorthodox solutions in order to keep their rates competitive and low.

It’s essential to understand that lowering the price itself isn’t the only option in this matter. What one needs is to aim for is increasing the value delivered for a competitive price. Here are some ways an online business can achieve this:

1.      Run limited special deals

Sometimes dropping the price irresistibly low is the best thing to do. This will raise the awareness of one’s business and delivering great service can motivate buyers to return even when the offer runs out. This is the beauty of the method as everyone is going into the deal with eyes wide open. Meaning, the buyer understands that the low price is an exception and a chance to grab while it’s there.

From then on, it’s up to the business owner who must ensure the customers are 100% satisfied. Leading web hosting providers use this method all the time offering low initial signup prices and fantastic discounts. The customers are aware that the renewal rates will be higher, but they cannot pass up the great offer and usually stay due to the excellent service delivered during the initial run.

The deals and discount coupons are published and promoted by websites featuring the latest web hosting news. This is an important point to consider for a business planning to use this method. They should get the information spread to the widest audience they can, so guest posting and placing press releases on all major news portals are necessary steps.

2.      Offer better shipment terms/extra services

When lowering prices directly isn’t possible, one should do their best to increase the value of their proposition. For an online business dealing with deliveries of any kind, increasing the speed and reducing the cost of this service will be a major boon. 87% of online shoppers state that the speed of delivery affects their decision about the purchase, which makes shipping one of the most effective elements for adding value.

Another method is to include some service or small free goods. The latter can be an excellent plan for launching a new product as one can add samples to the order. For a business owner, free gifts like this also offer a chance to ‘deal’ with the surplus of some goods. In some cases, such giveaways might be a better option in the long-run than running a price-dropping promotion for the items in question.

3.      Create custom offers

A savvy online business owner should put their data analytics software to good use and rely on the customer behavior information not only for their marketing campaign. This data can also be used to generate personalized deals. Unlike the time-limited special discounts, these offers have two important benefits:

  • They are personalized and therefore have a better chance of attracting a customer by ‘pushing all the right buttons’.
  • They show a personalized approach and give the customer a sense of being cared for and respected. This particular benefit is an increase in value that boosts not only sales but customer loyalty.
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