Mobile Ecommerce Pricing Strategies

I analyzed nine top app's pricing across nine major countries. Here's what I found. 💡 Guidance based on Calm, Strava, Duolingo, Spotify, and 5 others: 1️⃣ 🇺🇸 Start with your US price point that converts well 2️⃣ 🇬🇧 Price Eurozone* and UK at about 80-90% of the US price (after conversion) 3️⃣ 🇨🇦 Canada: 1:1 w/ US price after conversion rate 4️⃣ 🇦🇺 Australia: set at 80-90% of the US price 5️⃣ 🇮🇳 India: set at 20-50% of US price 6️⃣ 🇧🇷 Brazil: set at 40-55% of US price 7️⃣ 🇲🇽 Mexico: set at 60-70% of US price *Some companies price Germany higher than other Eurozone countries because of higher purchasing power. I created a price index using a "basket of apps." ▪️ I put all app prices into a spreadsheet for all countries ▪️ Converted them to USD to "normalize" data ▪️ Found the percentage difference to the US market 🍔 You may have heard of the Big Mac index. Digital goods are different, so Netflix is also used as a global price index. Looking at your global competitors or specific local competitors is better to understand willingness to pay. For example, Duolingo is more expensive in Europe than the US. Why? Because learning English can get you a higher-paying job. In the US, people learn a language to go on vacation. The value of your product changes on the specifics of the market and the type of product. If you’re converting well, but your price doesn’t match the guidance above, that’s fine! If it ain't broke, don't fix it. Changing prices is tricky. Start first with markets that aren’t converting or have a large amount of free users, but few paying. 📊 Do the math - what’s your highest converting country? If you lower prices, can you break even if your conversion rate increases to that amount? It’s unlikely a lower-converting country will all of a sudden convert better than your best-converting market. Don’t blindly make pricing changes. Get all the data you can, and then test with a smaller market to limit risk. 🇮🇳 India may be the largest opportunity for a lot of apps to optimize pricing. Huge English-speaking market but has lower purchasing power. India will often rank in the top 5 markets for new users, but waaay lower for actual paying users. ℹ️ Want more? Check out Retention . Blog: ▪️ I detail the methodology ▪️ How you can replicate this research for any app or country ▪️ What else to consider when pricing ▪️ And I’ll include my master price comparison sheet which includes price points for annual and monthly for Calm, Strava, Duolingo, MyFitnessPal, Babbel, Impulse, BetterSleep, Headway, and Spotify for 9 different countries. If you made it this far, but don't like newsletters, you can also connect with me, like the post, and comment "Price research" and I'll send you the full spreadsheet and methodology.

Competitive pricing isn't just about matching or undercutting competitors—it's a foundational, phase 2 pricing capability that, when used effectively with advanced analytics, can serve as the basis for dynamic pricing models, new product introduction strategies, and long-term pricing strategies. It's about smart positioning to boost market share, enhance profit margins, and drive sustainable growth. How can competitive pricing fuel your business success? • Penetration Pricing: Want to disrupt the market? Set prices lower than competitors to capture market share rapidly. This approach is particularly effective for emerging brands looking to make an immediate impact. Brands like Netflix and Xiaomi have successfully used penetration pricing to gain market share by offering lower prices initially. Competitors can use consumer research and advanced analytics-based insights to understand price competitiveness versus perceived value and determine the optimal pricing strategy for new product introductions. • Price Skimming: Aiming to maximize early profits? Start with a higher price to target early adopters, then gradually lower it to reach broader audiences. Advanced analytics help forecast demand curves and determine the ideal timing for price adjustments. Brands like Apple and Sony frequently use price skimming when launching new products, such as smartphones or gaming consoles, to maximize early profits from loyal customers. • Premium Pricing: Ready to command a premium? Create a perception of superior quality or exclusivity. Use data to understand customer willingness to pay and to segment markets effectively, allowing your brand's value to justify higher prices. Luxury brands like Rolex, Gucci, and Lululemon use premium pricing to position their products as high-quality or exclusive, justifying higher price points. • Intelligent Price Indexing: Want to stay competitive without sparking a price war? Use smart price indexing to strategically align specific product and customer segments with competitor prices while setting others slightly higher or lower based on segmentation, price elasticity insights, and optimal competitor price gaps. This approach allows you to selectively take the price off the table—indexing higher on certain items while knowing that only a certain percentage of customers will react to price differences. This self-segmentation helps drive profitability while maintaining competitiveness. Analytics can reveal where you can stand out—whether through customer experience, product features, or added services. Crafting an effective competitive pricing strategy goes beyond choosing a tactic. It requires understanding market dynamics and competitor behavior and clearly defining your value proposition. Using advanced analytics empowers smarter pricing decisions and drives growth. Check out our latest article on effectively using competitor pricing intelligence to drive profitable growth in your business.

One of my most rewarding projects involved a client who was struggling to increase sales despite having a strong product offering. After a thorough analysis of their pricing strategy, I identified a few key areas for improvement. Firstly, the client was offering too many discounts and promotions, which diluted the perceived value of their products. To address this, I recommended reducing the frequency of discounts and focusing on creating a more premium perception. Secondly, the pricing structure was overly complex, making it difficult for customers to compare products and make informed decisions. We simplified the pricing tiers and introduced a clear value proposition for each option. Finally, we adjusted the pricing based on market research and customer feedback. By understanding the competitive landscape and the customers' willingness to pay, we were able to optimize the prices to maximize revenue. These changes resulted in a significant increase in sales, with a 40% boost in revenue within the first quarter. The client was thrilled with the results and has continued to see positive growth. How have you been able to optimize your pricing strategy to increase sales? What factors do you consider when making pricing decisions?

Our most underestimated pricing strategy? Subscription models. It’s tempting to think pricing is just about one-time sales, but subscription models are rewriting the rules. They’re more than a trend—they’re a strategy for sustained growth and loyalty. Here’s why subscription models matter: → Predictable Revenue Steady, recurring income helps businesses plan better and weather market fluctuations. → Stronger Customer Bonds Subscriptions aren’t just transactions—they build relationships. Convenience, value, and personalization create loyalty. → Tiered Flexibility Different customers, different needs. Tiered plans let businesses cater to everyone—from budget-conscious shoppers to premium buyers. What about dynamic pricing? It’s another game-changer. Static pricing is out. Real-time adjustments are in. → Real-Time Adjustments Dynamic pricing powered by AI reacts to market shifts, competitor moves, and customer demand instantly. → Data-Powered Decisions AI sifts through trends, behaviors, and sales data to find optimal price points—no guesswork required. → Market Responsiveness Inflation or demand spikes? Proactive price changes keep you competitive without alienating customers. So, how do you stay ahead? 👉 Leverage Technology: Adopt AI tools to fine-tune your pricing and uncover opportunities. 👉 Stay Flexible: Pricing isn’t static—test, learn, and adapt as markets evolve. 👉 Prioritize Value: Show customers why your pricing reflects the value you provide. Subscription models and dynamic pricing aren’t just innovations—they’re the future of profitability and customer loyalty. What’s your strategy for embracing these trends? Let’s dive into it!

$100 and $99.99 are not the same. And it's not about cents. You might set your price logically. But your customer reads it emotionally... Is this premium or mass-market? Trusted or thrown together? Intentional or cheap? These details shape trust before anyone clicks 'Add to cart'. Because pricing is narrative as well as numbers. Here are four pricing nuances that matter more than you think: 1. Charm Pricing ↳ $49 vs. $50 ↳ The odd number feels lighter. Even a dollar changes the emotional load. 2. Prestige Pricing ↳ $100 vs. $99.99 ↳ Whole numbers signal confidence. They feel established. 3. Anchoring ↳ Add a $150 version to make $90 feel like a deal. ↳ Your most expensive item is sometimes meant to position rather than sell. 4. Bundling + Free Shipping ↳ "Bundle 3 for $99", "Free shipping at $75" ↳ Strategic grouping and thresholds can boost AOV without harming perception. Once, we helped a client (a wellness brand) shift from $39 to $42. Not a big jump at all. But over one quarter, that tiny shift added six figures in margin. The lesson? Value is perceived, not calculated. Which of these tactics have you tried before? ♻️ Share this to help others approach pricing more intentionally. Follow me, Francesco Gatti, for more on ecommerce growth.

💡Helping a Mentee Navigate Pricing Strategies 💡 When it comes to answering pricing questions and crafting a robust pricing strategy, it's all about understanding the product's positioning, goals, and target market. Here's how I recently guided a mentee navigate the pricing strategy conversation with confidence. Here's a peek: 1. The Big Picture: Positioning & Goal * Mass vs. Luxury? Begin by understanding if the aim is to make the product universally accessible or cater to a niche luxury market. This sets the foundation for your pricing approach. * Revenue Split: If applicable, delve into whether there's a revenue split involved, which can influence pricing decisions significantly. * Market Saturation: How crowded is the space? Consider the competitive landscape. * Next Best Alternative (NBA): What’s the price of the next best alternative that exists today and how does your product add unique value? 2. Unveiling Value: Cost & Perception * Cost-Based Pricing: Understand your production costs to set a healthy baseline. * Perceived Value: What's the worth your product holds in the customer's eyes? * Behavioral Pricing Strategies: Explore behavioral pricing techniques and conduct price testing to optimize pricing for maximum profitability. * Adapting to Product Lifecycle and Market Conditions: Understand how pricing may need to adapt based on changes in the product lifecycle or market dynamics. * User Willingness to Pay: Gauge customer spending power to ensure a fair price. 3. Unveiling the Pricing Toolbox * Versioning: Offer tiers with varying features at different price points. * Bundling: Combine products to create attractive value packages. * Multi-User Licenses: Cater to teams with volume discounts. * Consumption-Based Pricing: Charge for what's used, ideal for variable usage. * Subscription Model: Provides recurring revenue for predictable usage patterns. 4. The Power of Choice: Subscription vs. Pay-Per-Use: * Subscription: Ideal for predictable usage and fosters long-term customer relationships. Factors to consider: CAC (Customer Acquisition Cost), LTV (Lifetime Value), upsell opportunities, and ecosystem value. * Pay-Per-Use and and Replacement Units: Perfect for customers with fluctuating needs. Consider purchase frequency and replacement cycles. Remember, pricing is a strategic journey, not a destination. By understanding these factors and exploring various models, you can craft a pricing strategy that converts and fuels growth! #pricingstrategy #productmanagement