Pricing strategies are determined by factors like market conditions, consumer demand, and your cost of goods sold

Example: A boutique clothing store sells women’s sundresses at a high price during the summer and then puts them on clearance once autumn arrives.

4. Premium pricing

Premium pricing occurs when prices are set higher than the rest of the market to create perceived value, quality, or luxury. Customers are willing to pay a premium price when they know the brand name and have a positive brend perception . Companies that sell luxury, high-tech, or exclusive products—like businesses within the fashion or tech industry—often use the premium pricing technique.
Pro: Profit margins are higher since you can charge much more than your production costs.
Con: This type of pricing strategy only works if customers perceive your product as premium.
Example: A beauty salon builds up credibility within its market and offers its services for 30% higher than its competitors.

5. Psychological pricing

Psychological pricing strategies play on the psychology of consumers. In a way, you are luring in customers by slightly altering price, product placement, or product packaging. Some psychological pricing techniques include setting the price to $9.99 rather than $10, or offering a “buy one, get one free” deal. For example, 90% of retail price end with either “9” or “5.” Nearly any type of business can use this strategy, but retail and restaurant businesses most commonly employ this method.