{"id":18690,"date":"2018-05-21T23:18:25","date_gmt":"2018-05-22T04:18:25","guid":{"rendered":"https:\/\/www.hostgator.com\/blog\/?p=18690"},"modified":"2019-04-30T09:28:16","modified_gmt":"2019-04-30T14:28:16","slug":"online-store-millennial-shoppers-review-pricing","status":"publish","type":"post","link":"https:\/\/www.hostgator.com\/blog\/online-store-millennial-shoppers-review-pricing\/","title":{"rendered":"How Your Online Store Can Reach Millennial Shoppers By Reviewing Your Pricing"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-19187\" src=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/review-online-store-pricing-and-product-mix.png\" alt=\"review online store pricing and product mix\" width=\"1200\" height=\"629\" srcset=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/review-online-store-pricing-and-product-mix.png 1200w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/review-online-store-pricing-and-product-mix-300x157.png 300w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/review-online-store-pricing-and-product-mix-768x403.png 768w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/review-online-store-pricing-and-product-mix-1024x537.png 1024w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><\/p>\n<h2>Why Now Is a Good Time to Review Your Online Store&#8217;s Product Mix and Pricing<\/h2>\n<p>Millennials are upgrading their lifestyles. Is your store ready to help them do it?<\/p>\n<p>Shoppers age 20-36, as we mentioned in our <a href=\"https:\/\/www.hostgator.com\/blog\/ecommerce-future\/\">future of e-commerce<\/a> post, are driving growth in <a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2017-10-24\/gucci-surge-boosts-kering-s-sales-as-luxury-revival-races-ahead\" target=\"_blank\" rel=\"noopener noreferrer\">luxury online retail sales<\/a>. In the US, Europe, and <a href=\"https:\/\/jingdaily.com\/chinas-30s-shoppers-drive-decade-luxury-consumption\/\" target=\"_blank\" rel=\"noopener noreferrer\">China<\/a>, young consumers are spending more freely than before on luxe items-and are expected to do so for years to come.<\/p>\n<p>This means that if you&#8217;ve been holding off on adding more expensive products to your shop, this could be the time to go for it, to keep your customers from leaving you and to see better profit margins.<\/p>\n<p>But before you invest in new products, you&#8217;ll want to do a market analysis, find your break-even point for those products, come up with a plan to market your luxury items to young adult shoppers, and create an online shopping experience they&#8217;ll enjoy and want to experience again.<\/p>\n<p><a href=\"https:\/\/www.hostgator.com\/dedicated-server\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-18320\" src=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2017\/12\/Dedicated.png\" alt=\"best dedicated server hosting\" width=\"470\" height=\"60\" srcset=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2017\/12\/Dedicated.png 470w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2017\/12\/Dedicated-300x38.png 300w\" sizes=\"(max-width: 470px) 100vw, 470px\" \/><\/a><\/p>\n<h2>How Can You Analyze the Market for Your Luxury Items?<\/h2>\n<p>In general, interest in luxury goods is high among young adults. Consultancy Deloitte found that <a href=\"https:\/\/www2.deloitte.com\/content\/dam\/Deloitte\/uk\/Documents\/consumer-business\/deloitte-uk-young-luxury-shopper-2017.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">55% of US Millennials are 'very interested'\u009d in 'high-end fashion or luxury items<\/a>.'\u009d The percentage is even higher in Italy, the UK, and China. But you&#8217;ll want more details before you decide whether to invest in high-end products for retail or develop your own brand of luxe goods.<\/p>\n<p>Let&#8217;s say you sell handmade leather wallets but you&#8217;d like to add handmade shoes, which are a much costlier product. Through a combination of surveying your existing customers, studying demographic data, and <a href=\"https:\/\/www.hostgator.com\/blog\/inexpensive-online-marketing-tools-using\/\">online marketing research tools<\/a>, you&#8217;ll want to answer these questions:<\/p>\n<ul>\n<li>Who are the target customers for your product?<\/li>\n<li>Do they need and\/or want what you&#8217;re planning to offer?<\/li>\n<li>Do you have (or expect to attract) enough of these customers to make your investment in the new product profitable?<\/li>\n<li>How is the competition presenting these products or similar ones?<\/li>\n<li>How can you set your shop apart from competitors selling the same product? (Remember, <a href=\"https:\/\/www.hostgator.com\/blog\/win-competing-value-not-price\/\">competing on price is usually a losing proposition<\/a>.)<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<h2>What&#8217;s Your Break-Even Point?<\/h2>\n<p>Once you know that there are customers who will buy your handmade shoes, you&#8217;ll need to fine-tune how to price them and figure out how many you&#8217;ll have to sell before you break even and start turning a profit.<\/p>\n<p>To find your break-even point for different retail prices, you can use this clever <a href=\"https:\/\/hbr.org\/2014\/07\/a-quick-guide-to-breakeven-analysis\" target=\"_blank\" rel=\"noopener noreferrer\">break-even analysis tool from Harvard Business Review<\/a>.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-18691\" src=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/screen-shot-2014-06-25-at-4-50-04-pm.png\" alt=\"breakeven point analysis for online store\" width=\"360\" height=\"68\" srcset=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/screen-shot-2014-06-25-at-4-50-04-pm.png 360w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/screen-shot-2014-06-25-at-4-50-04-pm-300x57.png 300w\" sizes=\"(max-width: 360px) 100vw, 360px\" \/><\/p>\n<p>You&#8217;ll need to know, or have a good estimate of, your:<\/p>\n<ul>\n<li><strong>Fixed costs<\/strong>, which are the expenses you&#8217;ll rack up in developing your shoes, like design software, shoemaking equipment, and the money you&#8217;re budgeting for general promotions. (If you&#8217;re buying finished products from a supplier, you can substitute the wholesale cost of your initial goods purchase for product development costs). Let&#8217;s say setting up your workshop costs you $10,000.<\/li>\n<li><strong>Variable costs per product unit<\/strong>, which include the cost of materials and your time to make each pair. Variable costs can also include pay-per-impression digital marketing campaigns. Let&#8217;s put your materials, labor, and digital marketing costs at $200 per pair.<\/li>\n<li><strong>Revenue per unit<\/strong>, which is your retail price. Small-brand handmade shoes are typically priced around $300 per pair.<\/li>\n<li><strong>Unit margin<\/strong>, or how much money you&#8217;ll get to keep after each pair sells. &nbsp;In this case, it&#8217;s $100 per pair.<\/li>\n<\/ul>\n<p>Plugging these numbers into HBR&#8217;s calculator (or using their equation) yields a break-even point of 100 pairs of shoes sold at $300 per pair. Raise your retail price to $350, and your unit margin rises to $150 while your break-even point drops to 67 pairs, although it may take you longer to reach your break-even point at the higher retail price.<\/p>\n<p>&nbsp;<\/p>\n<h2>How Can You Market Your Luxury Items to Millennials?<\/h2>\n<p>With your shoes ready to go, your price set, and your break-even point calculated, it&#8217;s time to let luxury shoppers know you&#8217;ve got the goods.<\/p>\n<p>How can you do that? <a href=\"https:\/\/www.hostgator.com\/blog\/what-to-do-with-email-list\/\">Start with your email list<\/a> and social media followers. (If your shop doesn&#8217;t have an <a href=\"https:\/\/www.hostgator.com\/blog\/instagram-advertising-guide-business\/\">Instagram<\/a>, know that it&#8217;s a popular channel for major<a href=\"https:\/\/www.cnbc.com\/2018\/01\/09\/how-luxury-fashion-brands-are-using-instagram-to-win-over-millennials.html\" target=\"_blank\" rel=\"noopener noreferrer\"> luxury brands trying to reach Millennials.<\/a>)<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-18692\" src=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/Screen-Shot-2018-02-16-at-11.31.38-AM-1024x551.png\" alt=\"millennials find luxury items online on brand websites and social media\" width=\"490\" height=\"264\" srcset=\"https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/Screen-Shot-2018-02-16-at-11.31.38-AM-1024x551.png 1024w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/Screen-Shot-2018-02-16-at-11.31.38-AM-300x161.png 300w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/Screen-Shot-2018-02-16-at-11.31.38-AM-768x413.png 768w, https:\/\/www.hostgator.com\/blog\/wp-content\/uploads\/2018\/02\/Screen-Shot-2018-02-16-at-11.31.38-AM.png 1212w\" sizes=\"(max-width: 490px) 100vw, 490px\" \/><\/p>\n<p>In your messaging, you&#8217;ll want to include great, share-worthy photos and text that emphasize the 'quality and uniqueness'\u009d of your items. That&#8217;s because Deloitte found those two things <a href=\"https:\/\/www2.deloitte.com\/content\/dam\/Deloitte\/uk\/Documents\/consumer-business\/deloitte-uk-young-luxury-shopper-2017.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">matter more to the under-35 luxury shopper<\/a> than legacy brand names do. Promote your company&#8217;s ethics and sustainable practices, too-89% of US Millennial luxury shoppers in Deloitte&#8217;s study said they always or sometimes make sure a luxury brand is ethical and sustainable before buying.<\/p>\n<p>&nbsp;<\/p>\n<h2>How Can You Create a Luxury Customer Experience?<\/h2>\n<p>There are two basic elements that can take a basic online shopping experience to luxurious new heights: product details and excellent customer service.<\/p>\n<p>Deloitte found that a slight majority of young luxury shoppers in the US prefer shopping online to buying in-store. However, these Millennials also said that being able to try products and get a sense of how they feel are important benefits to in-store shopping. If you&#8217;re selling your handmade shoes online only, how can you give customers a clear sense of what your goods are like? <a href=\"https:\/\/www.hostgator.com\/blog\/need-professional-photos-business-website\/\">Invest in high quality product photography<\/a>, add product videos, and write brief but detailed descriptions of each luxury item you sell.<\/p>\n<p>To further encourage new customers to try your products, you&#8217;ll want to highlight your fair and reasonable return policies, free shipping and expedited shipping options, and guarantees on what you sell. If you&#8217;re doing double duty as chief shoemaker and customer service rep, remember to make each interaction with your customers as positive as possible. Answer questions about products as quickly as you can, and when people do buy from you, make sure the packaging is impressive, too.<\/p>\n<p>If your first foray into upscale products goes well, you may want to expand your offerings to include more high-end, high-margin items. In each case, remember to do your market research first so you can get the most return on your luxury-goods efforts.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why Now Is a Good Time to Review Your Online Store&#8217;s Product Mix and Pricing Millennials are upgrading their lifestyles&#8230;.<\/p>\n","protected":false},"author":162,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[98],"tags":[],"class_list":["post-18690","post","type-post","status-publish","format-standard","hentry","category-startup-small-business"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.2 (Yoast SEO v23.2) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Attracting Milennial Shoppers to Your Online Store | HostGator<\/title>\n<meta name=\"description\" content=\"Millennials are upgrading their lifestyles. Is your online store ready to help them do it? 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