EP 8. Should I Price Low When Starting on Etsy to Get Sales? | Etsy Tips for Beginners

WYW 4: In this episode I'm answering the Etsy question "Should I Price Low When Starting on Etsy to Get Sales?" I'll walk you through why low prices can actually work against you on Etsy and how to think about pricing from day one. Have a question you'd like me to answer on a future episode? Submit it at melissacarroll.co/question

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Transcript

SPEAKER_00 0:04

Hey there, welcome to the Modern Etsy Seller Podcast and What You're Wondering. This segment where I answer one specific Etsy question in under five minutes. I'm Melissa, a busy working mom with two profitable Etsy shops, and I'm here to help you build yours. Let's get to the question. So today I'm answering the question: should I price my products low when I'm just starting on Etsy to get my first sales? Some will say otherwise, but I say no, at least not in a drastic way. A lot of new sellers assume that if they're cheaper, people will choose them. And I see a lot of sellers starting out priced so low that they're barely breaking even and even losing money. You don't have to do that to get sales. And it doesn't match how buyers behave, especially on Etsy. People aren't looking for the cheapest option. They're looking for something that feels like the right purchase. There's something known as the price quality heuristic, and it simply means that people tend to use price as a signal for quality. So a higher price means better quality, and a lower price means it's a lesser quality. So when your product is priced way below everybody else, it doesn't always look like a better deal. Sometimes it raises questions about the quality. So if you price way below everyone else, buyers might not even consider you as an option. And that's not what you want. Another strike against pricing too low at the start is the type of customer you attract. Research and consumer behavior shows that pricing too low can attract the wrong kind of buyer. Someone who shops purely on price tends to be more demanding, more likely to leave a negative review, and less likely to be a repeat customer. You want buyers who value what you made, not buyers who picked you because you were the cheapest option. And remember, if you're in the gifting game, when someone is buying a gift, they're not trying to spend the least amount. They're trying to get it right. That doesn't mean you need to be the most expensive option though, either. When people are comparing options, they usually gravitate somewhere in the middle. So keeping your price somewhere in the middle is a nice safe choice. Now, can you be slightly competitive when you're starting out? Of course. But there's a big difference between being slightly under the market and dramatically cheaper. And one last thing I want to leave you with. When you price too low, you're not just undervaluing your product, you're undervaluing your time. Every listing you create and every product you design and every order you fulfill represents time and effort that you spent. Price from day one, like that time matters, because it absolutely does. Okay, if you have a question you'd like me to answer on a future episode of What You're Wondering, head on over to melissacarol.co slash question. Or you can click the link in the show notes. Thanks for spending time with me today. I'll see you next week.