Price Falling or Rising?

I have a website which sells homes, we have specials where we have a

price of a featured home that falls in price a cent a second ($864 per

day) until some one decides to attempt to buy the home, is it best to

do it this way or go to the bottom line and go up?

Which is the most effective and likely to succeed.

Request for Question Clarification bykeystroke-ga

I think you are fighting a double edged sword here.

Both of the stratagies would work, but they have both positive and

negative options.

It is great having a website

www.homesthatarereallycheapprettygoodandilikethemanywaysoidontmindifyoudontpluswehavegreatspecialoffers.com

but if no one knows about the special pricing or that your website

even exists NO ONE is going to use it, see it or take advantage of

your special offer.

The main things I would think about are: Are you getting the prices

that you require to A stay in business, B keep your clients happy

(both selling and purchasing homes).

If you advertise the price of a house starting at your target price +

8640 (never start the house for sale at the target price!) this gives

you 10 days of the price dropping before you start to run the risk of

the house not reaching the value it should be selling at.

The longer people wait (do you have a fixed time that the houses are

on sale for before they are removed?) the cheaper it is so people will

be sitting round hoping no one else gets it before they do, eventually

someone will be the chicken and purchase the house before anyone else

can. As the price is dropping the house becomes available to more and

more people so more and more people will be watching it (perhaps have

a counter displaying the number of people watching the house or have

viewed it in the last hour will help people "make up their minds").

In the alternative option having the price rise will rely on people

seeing it at the start of the listing (GOOD ADVERTISING IS PARAMOUNT

FOR THIS SO PEOPLE GET IN EARLY AND DON'T MISS THE CHEAP PRICE!!), if

people miss the initial start time and the price goes above their

maximum they will never be in contention for the house. As the price

goes up the amount of available clients for each house diminishes.

As you can see from this scenario, price starting high and falling

allows the sale to last longer and word of mouth can bolster your

potential customers.

Starting the price low will NEED a lot of people seriously looking at

purchasing a house ready and waiting for it to go on the market for

them to be in with a chance. To get the message across you are going

to need a good advertisement to get everyone ready, word of mouth

won't give everyone enough time to be online.

My advise is stick with the REDUCING PRICE HOUSE sales. In the long

run I feel it is more adventageous to you and your clients. If you

want to boost site hits or possible sales every month throw a house

out there after a big advertising campaign where a house starts low

and goes high, the first person to buy gets a good deal.

I hope this helps, if it is what you were looking for I will post as the answer.

–Keystroke-ga

Request for Question Clarification bykeystroke-ga

It may also be worth while to draw a graph to outline the advice I gave you.

Graph showing Prices starting high and falling

+ /

Number /

Clients /

/

/

/

– /

+ Price –

From this you can see that as the price falls the number of clients

available to purchase the house increases. (Everyone can afford a

house that costs nothing, but no one can afford a house that costs 60

trillion dollars).

Graph showing prices starting low and rising

+

Number

Clients

– Price +

This graph shows you that as the price increases the number of clients

who can afford or who want to purchase a house at an ever increasing

price diminishes.

As these sales are dependant upon time it may be in your interest to

catch the casual browser with the falling house price than it would be

to try and saturate a local market with an increasing price selling

model.

–Keystroke-ga



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