How to Price Products in Your Online Store (Without Copying Competitors)

There are two popular ways to set prices and both are wrong. The first: look at competitors and go slightly lower — a race to the bottom won by whoever can lose money longest. The second: add a percentage to the product's cost — which sounds reasonable until you discover the "cost" you used didn't include packaging, the gateway fee, return shipping or your own time.

Pricing well isn't intuition; it's a calculation with three inputs: what it genuinely costs you to sell one unit, what the market accepts, and what your positioning allows. This article builds that calculation step by step.

First: your real cost per order (not per product)

The root mistake is calculating the cost of the product when what matters is the cost of the order sold. Between the two sits a list of expenses that quietly eat the margin:

Second: the margin your business needs

Margin isn't an aspirational number: it follows from your operation. A 50% gross margin sounds high until you subtract returns, advertising and promotions — and you're left with 15-20% net on a good day. As a general reference by product type:

• Own or manufactured product: aim for 60-70% gross. You control the cost and nobody else sells the same thing.
• Reselling known brands: 30-45%. The market disciplines the price; your lever is volume and service.
• Artisanal or niche product: 65-80%. The value is in uniqueness; low prices here destroy perception rather than help.
• Recurring consumable: 40-55%, because the real value is the repeat purchase — where retention matters more than maximising the first ticket.

If the price the market accepts doesn't reach the margin you need, the answer is almost never "sell cheaper and make it up on volume": volume multiplies the costs too. The real exits are raising perceived value, bundling (more margin per ticket) or changing the assortment.

Shipping: the most visible pricing decision

Shipping cost is part of the price wherever you put it. The question isn't "do I charge for shipping?" but "where do I show or hide it?" — and each option has measurable effects.

• Free shipping absorbed into the price: converts best and simplifies; needs enough margin and works badly for heavy products.
• Free shipping above a threshold ("free over $50"): the best effort-to-result option; consistently raises average ticket.
• Shipping at cost, visible: honest and healthy for margin; converts slightly less and demands clear zone rates.
• Flat-rate shipping: predictable for everyone; check the real average isn't quietly costing you money.

Real last-mile costs, zone rates and what to promise on timelines are in ecommerce logistics and shipping in LATAM. For the free-shipping threshold, the practical rule: set it 20-30% above your current average ticket.

Price psychology: what works and what insults

Some price-presentation techniques have real, documented effects; other tricks today's customer detects and punishes. The line between them is simple: the former organise the decision, the latter try to confuse it.

• Anchoring: showing three options (basic, mid, full) makes the middle one feel reasonable. It works because it gives context, not because it deceives.
• Endings: $19.90 works for consumer goods; a round $200 communicates better for premium products. Choose by positioning, not by habit.
• The bundle: two products together at a slight discount raise both ticket and absolute margin. The most profitable technique and the least used.
• Honest strikethrough: "was $X, now $Y" only if the old price genuinely existed. Invented strikethroughs are illegal in many countries and obvious to anyone.
• Manufactured urgency: resetting countdowns and perpetual "only 2 left" destroy trust across the whole catalogue to sell one unit today.

How to raise prices without losing customers

Every store reaches the moment of raising prices and almost all do it late, because they fear it more than they should. The data usually says the opposite: a 10% increase that loses 5% of customers leaves more money — and better customers.

1. 01Raise first where you don't compete on price: your unique products, the ones bought for value rather than cheapness.
2. 02Pair the increase with a visible improvement: better packaging, better delivery time, better guarantee. It isn't makeup — it gives the customer something to tell themselves.
3. 03Don't raise everything at once. Stagger by category and measure the real reaction, not the feared one.
4. 04Tell your repeat customers. One honest line ("from day X these prices change") generates early purchases and zero resentment.
5. 05Don't apologise in the copy. "Due to rising costs we are forced to..." communicates weakness; the new price gets published and held.

The pricing mistakes that cost the most

• Different prices in the store and on social media. The customer who spots the difference never trusts either channel again.
• The permanent discount. If the 20% is always there, it isn't a discount: it's your real price wearing a costume nobody believes anymore.
• Ignoring price per unit of measure. For consumables, customers compare per kilo or per litre even if you don't display it.
• Cart surprises. The surcharge that appears at the end is the number-one cause of abandonment — the detail is in how to increase your store's sales.
• Never reviewing prices. Costs, freight and fees change every year; a half-yearly review is maintenance, not greed.