9 Ways to Stand Out Among Lower Cost Competitors (Without Lowering Prices)

culled from:http://smallbiztrends.com

There are two things we know about how the majority of consumers make their purchasing decisions. It’s no secret that most people want to be getting the appropriate value for what they are paying. And many potential customers make their purchasing decisions before even leaving the house by comparing products or services through an online search.
This makes it difficult for companies that are intentionally undercut by their competitors on price. But that doesn’t necessarily mean you should cut your costs. We asked nine entrepreneurs from the Young Entrepreneur Council (YEC):

“What is one tip for dealing with competitors that are intentionally undercutting you on price?”

Here’s what YEC community members had to say:

1. Be Explicit

“Find areas where you compete favorably and put up a comparison chart on your website. Be explicit — assume that your customers know about your competitors.” ~ John Rood, Next Step Test Preparation

2. Provide Value and Customer Service

“When prices can’t be lowered, focus on the ways you’re ahead of your competitors in terms of quality. Clients care about price, but they care more about the quality of what they’re getting for their money. Customer service is also a key point. This, in many cases, is more important, and clients are willing to pay higher prices to have a partner, not a just a hired gun, working for them.” ~ Simon Casuto, eLearning Mind

3. Raise Your Prices

“As our market becomes more competitive, we increased prices to help us tell the story of how we are different. When our prices were lower, it was harder to tell a compelling story. As the difference in price points became greater, we had the opportunity to tell a better story and we did. Our prices have increased as more and more low-cost competitors jump into the market.” ~ Andrew Angus, Switch Video

4. Don’t Play the Game

“Our competitors went free recently. There’s always buzz when people make sales or drop prices, but it eventually dies down, and the one with the better product or service returns to the winning position.” ~ Ioannis Verdelis, Fleksy

5. Only Engage If You Must

“Competition is the ugly truth of business and sometimes it can get nasty. If a competitor is undercutting your price, then you need to react by further positioning your offerings as more valuable than others in the market. It is all about keeping your company on its own path. Racing to the bottom against someone setting the pace can easily end up with your business crashing and burning.” ~ Brian Honigman, BrianHonigman.com

6. Stress Your Core Differentiator

“In these situations, companies have to clearly communicate what differentiates them. Apple did not panic and reduce all their prices as smartphone companies undercut them on price, because they differentiated themselves. When we think of Apple, we all think of high quality products and great innovation.” ~ Randy Rayess, VenturePact

7. Stay Firm on Prices and Offer More Free Content

“Engaging in a price war only harms your niche in the long term because it drives down profit margins for everybody. Stay firm on your prices and focus on adding value by creating more free content on your website and on social. Make help videos, write lots of great guest blog posts and share on social. Consumers will increasingly see you as a trusted authority which will justify your prices.” ~ Dave Nevogt, Hubstaff.com

8. Separate Yourself as the Premium Offer

“If you cannot lower your prices to compete, then separate yourself as the premium offer in the market. Invest in your branding and customer service to make it stick. If the market allows, then you may end up with the higher-end clients and higher margins than your competitor.” ~ Faraz Khan, Khan Investments

9. Uphold the Value of Your Brand

“If you focus on price alone, you’ll never win the war. Focus on the value your product will bring your customers and why your product is what they need to become more profitable. This is worth far more than shaving off a few dollars for the initial investment. Remain true to the pricing structure you’ve set in place and uphold the real value of your brand!” ~ Kelsey Recht, VenueBook