Don’t change your prices. Change your audience. Here’s how to market your prices.
We have all been frustrated by a lead asking for a lower price. The difference between those who agree and those who don’t isn’t skill or knowledge. It’s confidence.
Today, I’m sharing the tips I use when I’m confronted with the dreaded question, ‘is that your best price?’
Remember your value
It’s good to refresh our minds with something we know – remember your value. You’re charging your price because of what it is you do. You’re charging your price for the wealth of experience you have, and the time you have spent learning.
Sure, I could replace the roughcasting on my own home. There will be YouTube videos out there showing me the best way. However, I don’t want to have to do it. I also don’t want my wife shouting at me when I’ve done a bad job, and we then have to pay twice.
Remember that value is subjective. If someone doesn’t see the same value in what you offer, that’s fine. They can find someone else, and so can you.
Ask your lead about value.
Price and value are two different things. A traditional watch can be priced the same as an Apple Watch. If you don’t like technology, but you like good watches, then the value of the Apple Watch will be much less to you than it is to me. I’m fascinated by technology.
Similarly, your expectation of value has to make sense.
If you expect a return on investment of £100,000 but you are only prepared to pay £100 for a service to achieve that, that’s unrealistic. The average operating profit margin for the S&P 500 was 10.31% profit in Q1 of 2018. That would mean if you bettered this, you’d have operated better than the largest companies in America.
Remind people of your experience, but don’t be pushed to doubt your value. There was a point in your business where it made sense to charge that price. Unless something has substantially changed (excluding the pandemic!) you shouldn’t need to revise this price.
You may, however, need to revise who you are offering your service/product to.
How do I change my audience?
Change your content. Instead of solving problems small businesses face, address the issues large companies would love a solution to. If your content doesn’t have relevance to the audience willing to pay your prices, then you’ll never attract them with your pricelist alone.
You will see a drop in engagement and traffic. This is because you will transition to finding a new audience, and you should never panic. It is the right decision. You are worth that change.
Content marketing is a slow experiment. Don’t give up on it.
How do I market my prices to a new audience?
Don’t compare your prices to others, but do compare your own products. Use an effect called the Ebbinghaus Illusion. It’s basic principle is making one product more attractive by setting the prices around it.
The example I use is this:
BEARD TRIM – £5
HAIR CUT – £15
BEARD & HAIR – £15
The final option is the most valuable – and you’re supposed to think that. I don’t want to do beard trims, but I know that that offering both converts more leads. It’s pretty pricey, though. So, I set a middle product to “prove” my value.
We can influence how people see our value. So, you need to control how that happens.
Don’t be troubled by bargain hunters.
There will always be people who will ever accept your value, no matter the discount you offer. The best way to help someone in this position is to offer the services of a website like Fiverr. Don’t be rude. Just understand that their focus on value is price.
It was never your focus.
If you can’t prove your value by evidencing your experience or the benefits you provide over others, then draw a line. Don’t fight for a customer who is fighting against you. If a friend did that, you’d end the friendship.
Any marketing strategy needs to be backed with confidence. Pricing is just another marketing strategy. So be confident in what you’ve set.
If nothing else has made you confident, realise this:
There are 7.8 billion people on earth right now. If you require £30,000 of income and each item is £5, you need 6,000 people per year. That’s 0.0000007% of the population.
I like those odds.
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