digitalv - 5:03 pm on May 21, 2010 (gmt 0)
On the subject of raising your price, this is where test marketing comes into play. Ever notice you'll see an infomercial and the price is $29.95, then a month later you see it for $19.95, then another month later it's two for $29.95, etc.?
When we shoot a new commercial we make a handful of test price points and air different commercials to different markets before going national to figure out the best price. Obviously you're going to sell more at the lower price, but what we aim to figure out in the test phases is at what point does the loss in the number of customers affect a loss in revenue.
If you sell 1,000 at $10, but only sell 800 at $13, although you had fewer sales you actually made more money.
The trade-off is different for every product, the only way to know it is to test it out.