11 eCommerce Pricing Strategies Every Seller Should Know in 2024

Updated   |  12 min read
Key Takeaways
  • Pricing, when coupled with convenience and trust, is the primary reason people purchase from one website over another.
  • You don't have to choose just one eCommerce pricing strategy, but which ones to choose should be based on the analyzed actions of your existing customers and the customers you want to draw in.
  • Your pricing strategy helps ensure you make a profit, but which strategies you use can affect how customers view your business—both positively and negatively.
Market-based pricing can offer a unique selling proposition.

Online shopping has become one of the most popular ways to purchase goods and services, with an estimated 2.14 billion digital buyers worldwide. While it's vital for every business to engage in positive customer relationships and reasonable shipping costs, pricing is still a primary factor for eCommerce startups to be successful in a competitive environment. Entrepreneurs must pay attention to pricing strategies in order to gain an edge over their competitors.

To guarantee success in any industry and stay ahead of the competition, businesses should research their target audience and adjust their pricing strategy accordingly. Sure, it’s important to review the prices of other market players regularly, but there are many ways to alter the price of products that aren't necessarily affected by the actions of your competitors. Keep reading to find out more about which eCommerce pricing strategy is best for your business.

An e commerce pricing strategy helps draw specific customers in.

Why Do You Need a Pricing Strategy?

In order to maximize success with strategic pricing, there are a few key aspects to consider. First, understanding the pricing strategy of competitors and the market conditions is essential. This helps businesses stay ahead by reacting quickly to changing trends, allowing them to adjust prices accordingly and remain competitive. Also, customer segmentation should be taken into account when it comes to setting prices—different customers will have different needs, so offering a variety of strategies and deals can be beneficial for everyone purchasing from your eCommerce website.

A person visiting an eCommerce website

Achieving success with strategic pricing also requires businesses to be aware of current economic conditions and customer demand. Each eCommerce business should take into account things such as seasonality, discounts, and promotions when determining their flexible pricing. Offering discounts or other incentives during certain times can help bring more customers in while promoting loyalty among existing ones.

Such strategies shouldn't be blindly attempted. Businesses should use data-driven insights to inform their decisions regarding eCommerce pricing strategies. Leveraging analytics tools such as A/B testing and predictive models can provide valuable insights into how customers perceive prices for different products or services.

A person at a computer investigating consumer-based pricing

How to Pick the Best eCommerce Pricing Strategy

We're about to hit you with a list of the eleven most common eCommerce pricing strategies around. Considering you won't be using them all, you now have to ask yourself: Which strategies are best for my business?

We can't answer that question for you, which is why you'll probably want to look at the third point below about hiring a pricing analyst. But before you do, consider the following.

Establish Clear Objectives

Yes, you want to make more money. But what pricing methods are most likely to make that happen? Are you more interested in increasing profits per item, or on average order value (AOV)? Are you focused on keeping your current customers, or are you experimenting with flexible prices to make as many impressions as possible on new customers (even though new customers might be less likely to buy)? Maybe you want to have a sale to clear out inventory so that you don't have to rent more warehouse space.

Objectives and the right pricing strategy will change over time—even week to week—but starting with a clear objective and how you will present your business to the world will help determine the most effective eCommerce pricing strategy to start with.

Research Customer Demographics

Who is your target market? It's one of the most basic questions every business has to answer, because you must understand who makes up your target market and what they value in terms of products. Knowing the average selling price that most of your customers are willing to pay can help you make the best decisions regarding prices and the target profit margin.

Take into account their purchasing power and determine how much they are willing to pay for items...and consider if paying more for items is actually one of the reasons they want what you have.

Utilize Pricing Analysts

Hiring a pricing analyst can be an excellent investment to help understand your customers and the best price to present to them. Utilizing the services of a professional pricing analyst can help you make informed decisions when it comes to setting prices and choosing an appropriate competitive pricing strategy.

Analysts can conduct research into competitors’ prices, analyze customer trends and behaviors, create dynamic pricing models, and suggest optimal price points for maximum profitability.

Pricing analysis.

What Are the Most Common Pricing Strategies in eCommerce?

Every business must decide which pricing strategies are most effective in order to reach its objectives. Few (if any) businesses will use every pricing strategy, as some of the following pricing schemes are at odds with each other. Here are the eleven that you should know about.

Value-Based Pricing

Value-based pricing is a pricing strategy based on the perceived value of a product or service in the eyes of customers. This type of pricing strategy helps businesses ensure that they are focusing their price optimization efforts on what customers truly value and see as valuable, instead of simply cutting prices to gain market share

Value-based pricing gives businesses more control over setting prices, allowing them to adjust prices according to consumer demand and value perception. It also enables companies to differentiate themselves from their competitors and increase overall profitability.

Cost-Plus Pricing

With a cost-plus pricing strategy, the business sets its price based on the cost of producing and marketing the product or service, plus a predetermined markup for the desired profit margin.

This form of cost-based pricing allows companies to ensure they are making a profit while also considering factors like customer demand and competitive pressures. Cost-plus pricing can also benefit businesses that produce products with variable costs such as inventory and labor costs.

Penetration Pricing

Penetration pricing is where a product or service is offered at an initial low price in order to gain market share quickly. This type of pricing aims to attract new customers and encourage them to switch from competitors. Penetration pricing can benefit eCommerce businesses as it helps them increase their customer base and build brand loyalty. However, it is important to consider the potential risks associated with this pricing strategy, such as eroding margins and setting expectations of low prices in the future.

Competitive Pricing

This competition-based pricing strategy involves actively analyzing the prices of competitors in the market and adjusting selling prices to stay competitive. This type of pricing can help businesses increase sales, attract new customers, and build market share. Additionally, it provides valuable data on the market that can be used to inform decisions on product features, positioning, and if you should offer a lower price. However, it is important to consider potential risks associated with this strategy, such as price wars or predatory pricing, that could reduce your profit margin.

Loss-Leader Pricing

An extreme version of competitive pricing is loss-leader pricing strategy. Loss-leader pricing is a pricing strategy where an eCommerce business sells certain items at or below cost in order to drive customers into their store, with the goal of making a profit from other items. This type of pricing can be beneficial for businesses as it can attract new customers and increase brand loyalty, all while ensuring customers are less likely to visit the competition. It can l also lead to an increase in overall sales due to customers buying additional items outside of the loss-leader product.

Loss-leader pricing usually benefits businesses that sell thousands of items, such as grocery stores or big-box stores. The store can lose money on a few items if it means getting people into the store and realizing a profit on dozens of other regularly priced items.

Dynamic Pricing

Similar to competitive pricing, dynamic pricing involves adjusting prices in real-time based on market demand. This pricing type can benefit businesses by allowing them to maximize profits and beat competitor prices. Additionally, dynamic pricing is useful for businesses that have products with differing levels of popularity among customers and need to adjust their prices accordingly with different prices.

Bundle Pricing

A bundle pricing strategy is where multiple products are offered at a discounted price, usually as part of a package. This type of pricing can be beneficial for businesses as it encourages customers to purchase more items and can lead to increased margins.

Bundle pricing allows businesses to offer discounts in exchange for buying multiple products, while still allowing them to maintain control over their prices. However, it is important to consider potential risks associated with this strategy, such as customers only buying specific items or not taking full advantage of the bundle offer.

Price Skimming

The price skimming strategy is when a higher selling price is initially set for a product and then gradually decreases over time. This type of pricing can be beneficial for businesses as it allows them to capture the most value from early adopters before the market saturates. Additionally, price skimming encourages customers to purchase at the higher price before the price drops, leading to more sales and higher profits.

Premium Pricing

Premium pricing is a pricing strategy used by eCommerce businesses where higher prices are charged for certain products. This type of pricing can be beneficial for businesses as it allows them to generate more revenue from their most profitable products. Additionally, setting a premium price can signal higher quality or exclusivity of the product to potential customers.

It is important to consider potential risks associated with this strategy such as losing customers due to being perceived as too expensive or damaging the company’s reputation if the value isn't perceived to be worth the premium selling price. Still, this method of pricing works for high-end products that specifically cater to customers interested in premium brand recognition.

Anchor Pricing

Anchor pricing is the strategy where a higher price is initially charged for a product, and then discounts are offered to encourage customers to purchase. This type of pricing can be beneficial for businesses as it allows them to generate more revenue from products that may have lower market demand. More importantly, anchor pricing can help establish the perceived value of the product and lead to more conversions.

Potential risks associated with this strategy can include customers feeling like they’re being taken advantage of. For instance, customers may like the "sale price" but then feel manipulated if the fake "regular price" is twice that of your competition's regular price.

Psychological Pricing Strategies

Psychological pricing is a pricing strategy used by eCommerce businesses to take advantage of customers’ mental processes to influence their purchasing decisions. This type of pricing can increase demand and conversions. Common psychological pricing techniques include using odd prices ($7.99 instead of $8.00), small incremental markup, lower-priced alternative options (a small increase in sizes of sodas at a fast-food restaurant), or removing the dollar sign from a restaurant menu so that people think about costs less.

It is important to consider potential risks associated with this way of changing consumer behavior, such as customers feeling like they’re being taken advantage of or not getting a fair price for their purchase.

A person looking at a list representing the most popular e Commerce pricing strategies.

Pricing in eCommerce Takes Finesse

A good pricing strategy is often built around a target market and what ideal customers would be interested in paying for such products. It is essential that your product is priced based on consumer preference and the demand for your product.

Clarity Ventures can help you create a plan so that your eCommerce business can address the pricing needs of your business. We offer a complimentary discovery process to help your business reach the next stage of growth.

We'll bring our business analysts and developers to the table to create a map for the future of your business, whether you're a startup or are revitalizing your eCommerce platform. You can follow through with this plan by working with us, or you can take it to a different developer; we're just interested in forming a relationship and helping you succeed. Get in touch today to get the process started!

>Effective pricing strategy.

Work with eCommerce Experts

Get in touch to get started on your free eCommerce pricing strategy discovery session and find your eCommerce solution.

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Pricing in eCommerce is the process of setting prices for goods and services that are sold through an online store. Prices can be determined based on various factors such as cost, customer demand, market conditions, and competition. In addition to setting the actual price for products, businesses may also offer discounts or promotional offers in order to incentivize customers to make purchases.


Ecommerce pricing is important because it can have a major impact on the success of an online store. The right pricing strategy can encourage customers to make purchases and increase sales, while the wrong pricing strategy may lead to fewer sales or even customer alienation. When setting prices, business owners must consider factors such as their target market, the cost of their products, competition in the market, and customer behavior. With careful consideration and strategic decisions, businesses can ensure that they are maximizing their profits while still providing customers with fair prices.


While some forms of pricing are more popular than others, the most basic is dynamic pricing. This method of setting prices takes into account various factors such as customer demand, online competitors, industry trends, and market conditions in order to adjust the price of a product or service accordingly. Dynamic pricing allows businesses to be more agile and reactive to the ever-changing market conditions, while also providing customers with fairer prices that are tailored to their needs.


Here is a list of the eleven most common types of cost-based pricing you'll find in eCommerce stores.

  1. Value-Based Pricing: Pricing items focused on perceived value to the customer
  2. Cost-Plus Pricing: Charging a price based on all costs associated with the product, including the planned markup
  3. Penetration Pricing: Offering an introductory price, then raising the price later
  4. Competitive Pricing: Changing prices based on a competitor's pricing
  5. Dynamic Pricing: Changing prices based on seasonal needs, holidays, stock levels, and competitor pricing
  6. Loss-Leader Pricing: Losing money on a small number of items to get customers into a store (or onto a website) to make money on other items they'll buy while there
  7. Bundle Pricing: Getting customers to buy more when they buy items in pre-groups
  8. Price Skimming: Setting a price high with the plan to gradually decrease it over time
  9. Premium Pricing: Charging more for an item because of its premium brand recognition
  10. Anchor Pricing: Charing a higher price (the anchor price) for a product with the intention of immediately lowering the price with sales and other discounts
  11. Psychological Pricing: Using psychological tricks to convince customers that the price is a better deal than it actually is.

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Stephen Beer is a Content Writer at Clarity Ventures and has written about various tech industries for nearly a decade. He is determined to demystify HIPAA, integration, and eCommerce with easy-to-read, easy-to-understand articles to help businesses make the best decisions.