Monday, August 30, 2010

The Value Of A Dollar Is Social

"The value of a dollar is social, as it is created by society."

-- Ralph Waldo Emerson

The value of a dollar is entirely subjective. Pricing is less a science and more a guessing game. What people pay is entirely based on how they perceive the value of the item. The value of an item can be expressed in many ways and it can also be perceived is as many.

I have an online business through eBay selling used books mostly and also music and movies, mostly VHS. It is not a big business but I have over 10,000 items on eBay and at the moment. Some things may be online without a sale for years. I started this business in mid-2004, and by mid-2005 had amassed quite a bit of inventory. Much of it is common, but I have done pretty well with a certain strategy.

There is a series of books I had quite a few of called, the Chicken Soup For The Soul and miscellaneous titles as such. Book dealers trip over themselves to sell these for .75 each, but what's the point of that? So, I listed them for $5.95 plus $3.50 shipping. Well, you know, I've actually done pretty well with that kind of pricing because I had a photo of the actual book and a large selection of things, but I full well knew I was pricing myself out of this market. But, I did nothing and several years later, I still had these books.

One day a couple of weeks ago, I was looking at them in the warehouse and decided to try something. So, I priced them at $3.95 with FREE shipping as a test to see if I could sell one, otherwise I would just take them offline and throw them away as a lost cause. By the way, it's not the value of the books as reading material, it is that there were so many millions printed!

The day after I changed the price one sold. The next day another, then another and another. So, there ya go. I still got a great deal more than those tripping over selling them for 6 bits, and found a price that customers felt value at. Win-win. Shipping cost me about $2.50, so it is all good, and the experiment paid off. I wouldn't call it EUREKA, but it is a positive change.

So, there's a story of value and price in a nutshell. I love the eBay business because it teaches me so much and I get stories to tell to boot. Win-win.

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