Summary: <p><a href="https://twitter.com/keysight_daniel?lang=en">Daniel Bogdanoff</a> and Mike Hoffman sit down with Brig Asay to talk about how to price a hardware project. Listen in as they discuss the complexities of pricing a new hardware product in a global economy.</p> <p>Follow Brig Asay on Yelp <a class="jive-link-external-small" href="https://community.keysight.com/external-link.jspa?url=https%3A%2F%2Fbrig.yelp.com" target="_blank" rel="nofollow noopener noreferrer">@baasay</a>.</p> <p>Video Version (YouTube):</p> <div class="jetpack-video-wrapper"></div> <p>Audio Only:</p> <audio class="wp-audio-shortcode" id="audio-939-21" style="width: 100%;"><a href="https://eestalktech.com/wp-content/uploads/2017/07/how-to-price-your-hardware-project-ees-talk-tech-electrical-engineering-podcast.mp3">https://eestalktech.com/wp-content/uploads/2017/07/how-to-price-your-hardware-project-ees-talk-tech-electrical-engineering-podcast.mp3</a></audio> <p>0:00 Intro</p> <p>How should you price hardware?</p> <p>1:45</p> <p>Tell us in the comments what you think our green screen should be!</p> <p>2:00</p> <p>Economics 101: Supply & Demand</p> <p>This is how we generally set prices for hardware</p> <p>2:40</p> <p>Top down pricing takes into account your cost of manufacturing.</p> <p>But if you price based on production costs, you’re going to fail in your pricing.</p> <p>It’s all about what consumers are willing to pay.</p> <p>4:00</p> <p>Pharmaceutical companies are the example of bad pricing schemes. They justify high prices based on high R&D costs.</p> <p>But the reality is that consumers don’t care about R&D costs. They care about how bad they need the product, and this will determine how much they are willing to pay.</p> <p>4:30</p> <p>Someone on <a href="https://www.eevblog.com/forum/">EEVblog</a> hacked a <a href="http://www.keysight.com/en/pcx-x205216/infiniivision-3000t-x-series-oscilloscopes?cc=US&lc=eng">3000T</a>, reverse engineering it to make it a 1 GHz scope.</p> <p> </p> <p>5:30</p> <p>The newer the idea, the harder it is to price because there’s no real market value.</p> <p>Talking to potential customers is a good way to start pricing in white space.</p> <p>6:45</p> <p>Marketing 101: Who are your customers?</p> <p>Determining who you are trying to sell to and talking with them can help with pricing.</p> <p>Competitor pricing is a good baseline, but then you often get into <a href="https://en.wikipedia.org/wiki/Value-based_pricing">value-based pricing.</a></p> <p>7:50</p> <p>Spreadsheets are the killer of pricing. They compete with your gut feeling.</p> <p>$10K per GHz of bandwidth is a standard in oscilloscope pricing, but it doesn’t always apply. When we came out with the <a href="http://www.keysight.com/en/pcx-x205212/infiniium-z-series-oscilloscopes?cc=US&lc=eng">Infiniium Z-Series</a>, a 63 GHz scope, we knew the market couldn’t support a $630K price.</p> <p>9:00</p> <p><a href="http://www.vendavo.com/blog/leaning-into-the-curve-using-volume-curves-to-improve-pricing-performance/">Price/volume curve</a> = Supply and demand chart</p> <p>10:50</p> <p>Different regions have different pricing expectations.</p> <p>Currency, cultural expectations, and import taxes all come into play when considering regional pricing.</p> <p>Should a small company even worry about regional pricing?</p> <p>16:40</p> <p>You need to be willing to adjust pricing.</p> <p>Dynamics of the market and the value of your product can change over time.</p> <p>If you’re not selling anything, you need to adjust your price.</p> <p>Priced too low and people may have the perception that you’re selling a low-quality product.</p> <p>19:20</p> <p>Pricing too low may also inadvertently shrink your</p>
