Letting your customer set your prices. Sounds crazy, right? Some businesses find that it works.
Pay What You Want (PWYW) is a pricing system where buyers pay any desired amount for a given commodity, sometimes including zero. In some cases, a minimum (floor) price may be set, and/or a suggested price may be indicated as guidance for the buyer. The buyer can also select an amount higher than the standard price for the commodity.
Giving buyers the freedom to pay what you want may seem to not make much sense for a seller, but in some situations it can be very successful. This is because it eliminates many disadvantages of conventional pricing. It is obviously attractive to buyers to be able to pay whatever they want, for reasons that include eliminating fear of whether a product is worthwhile at a given set price and the related risk of disappointment or “buyer's remorse”. For sellers it obviates the challenging and sometimes costly task of setting the “right” price (which may vary for different market segments). For both, it changes an adversarial conflict into a friendly exchange, and addresses the fact that value perceptions and price sensitivities can vary widely among buyers.
In the book Smart Pricing (p. 29), it is suggested that successful pay what you want programs are characterized by:
A product with low marginal cost
A fair-minded customer
A product that can be sold credibly at a wide range of prices
A strong relationship between buyer and seller
A very competitive marketplace.
While most uses of pay what you want have been at the margins of the economy, or for special promotions, there are emerging efforts to expand its utility to broader and more regular use, as noted in the Enhanced Forms section below.
Variant terms include "pay what you wish", "pay what you like", "pay as you want", "pay as you wish", "pay as you like", "pay what you will", "pay as you will". "Pay what you can" is sometimes used synonymously, but is often more oriented to charity or social uses, based more on ability to pay, while pay what you want is often more broadly oriented to perceived value in combination with willingness and ability to pay.
So as the weather warms up make sure your business is ready to warm up with it. Call MI Printing at 623.582.1302 and see how we can help you communicate with your warm market.