Price Point - Mastering The Art Of Setting Your Prices

Speaker 1 Hello and welcome to the UCAN podcast. I'm your host, Sarah Jolly Jarvis, and today we're going to be talking around pricing.

Speaker 1 Now, pricing is always a tricky subject, and it's something that when I start working with people, particularly those who have obviously got established businesses, it is a contentious issue.

Speaker 1 It tends to be an area of their business where they aren't so confident, they haven't been putting their business

Speaker 1 first and foremost, and their potentially their sort of insecurities and challenges around what they charge and self-worth, etc., come to the fore. So many women in business charge too little, okay.

Speaker 1 Why? Well, I think that there is a number of reasons why we enjoy what we do, okay, and that can make us feel bad charging full price for it.

Speaker 1 Something it's so strange, but it's a little bit like we can only work on one currency, and it's like if that currency is fulfillment, then I can't possibly be charging a kind of fair price at the same time I should be reflecting that and sort of doing it at a more accessible price I think there's also the fact that we've got you know that compassion side of things and we can see that people really need what it is that we are providing you know naturally we go into a

Speaker 1 supportive role a lot of women that I work with in business it's a coaching a supporting kind of service that they are offering and so I think that there's an element of feeling like well this person really needs what I do and you know that is not lost on me the people that I can have the biggest impact on the people that people that need me the most are the people that can afford me the least and you know I help people with their sales and marketing and getting that structure and generating more sales in their business of course those people are potentially going to be experiencing low levels of sales and so you know it is not lost on me but at the end of the day you have to be in a position where you can make your business profitable and sustainable before you can start helping individuals at a lower price point

Speaker 1 or

Speaker 1 you know offering

Speaker 1 pro bono or doing something which you know potentially creating lower priced courses you know you do tend to start off with higher priced items so you know I think that's that as well I think there's also the confidence around the value we are providing I think it's very easy I've kind of touched on it in the beginning by saying talking about self-worth I was talking to a client this evening and I was saying to her you know you have to detach your self-worth, your belief in yourself, your belief in how much you're worth from your business and the service that you are offering.

Speaker 1 We're not selling ourselves, there is no price tag involved in purchasing us, we are not for sale.

Speaker 1 What is for sale is a small section of our brains, of our thought processes that we will allow people to hire and to borrow and to use to relate to their own scenario. And that is, therefore, not me.

Speaker 1 At the end of the day, most people, they're not actually as much as you know as lovely as i am people aren't working with me so that they can spend a set amount of time every week with me they're working with me because they want the outcome that i have marketed them and i know that i can achieve for them and that will help them achieve and so with that in mind they're thinking about that end offer therefore if they speak to you and they're in that position where they're thinking you know what i'm not sure that this is the right option for me that's probably in the way that it's delivered and it could be in you and that chemistry between you and feeling that actually you're not in the same place as them they're not necessarily a good fit and but that is your way of working that is your way of communicating that you know you're not going to be loved and liked by everybody that's not what you're aiming to do you're aiming to serve the people you can serve best and they are the people that get you who value what it is that you offer and so you know the vast majority of time really it's also they're looking at that outcome and it's is that outcome the right thing for them right now is that outcome what they are searching for?

Speaker 1 And so, you know, it is when you start to think of it like that, you know, it makes it, it makes it easier to detach yourself from that

Speaker 1 feeling of putting yourself out there, promoting yourself,

Speaker 1 potentially getting turned down. And that feeling that

Speaker 1 you might get a no, that feeling that you, you know, might get rejected. Heaven forbid.
And so, yeah, I think that that plays into it as well.

Speaker 1 I think there's also, you know, we aren't aware of the value that we're providing.

Speaker 1 I think, you know, understanding where it fits versus our competitors in comparison to our competitors, we often shy away from obtaining that information.

Speaker 1 And in not having that information, we're not well equipped to understand actually, this is where I fit, and I'm a really, really good option and a great alternative to some of the other things out there.

Speaker 1 So what do I get clients to do in order to kind of address this? Because, yeah, we can identify this as a problem and we can talk about that. But really, the point is, is how do we move on from this?

Speaker 1 Well, one of the best ways to do that is to research, okay, is to figure out exactly where you fit. And this is what I get clients to do.

Speaker 1 I get them to do market research, competitive research, where they look at where their competitors are. So, okay, their strengths, their weaknesses of their competitors.

Speaker 1 Now, this can be a scary idea is to look at your competitives, you know, so so rawly and to look at, okay, where how do I compare to them? How do they appear better than me?

Speaker 1 How, in in what areas am I stronger than them? But actually,

Speaker 1 your customers are doing that all the time. You know, if people are window shopping, if they're shopping around for the best option, then they're going to make that comparison.

Speaker 1 So, you might as well be aware of the comparison that they're making.

Speaker 1 Yes, it can be a bitter pill to swallow sometimes, but actually, if you are armed with that,

Speaker 1 you can easily sell against it. You can easily educate your customers as to why you are the best option and why your strengths are so important.

Speaker 1 There's also alternative solutions to consider, which I talk around as indirect competition. So it's people which are providing the same outcome as you, but in a different format.

Speaker 1 I remember a good few years ago, one of my clients was wanting to figure out the cost of a yoga retreat. And we were talking around, okay, so you know, what's like it in that area?

Speaker 1 And they were like, well, there isn't really, there isn't really anyone offering the type of yoga that I do. It's got a very different outcome to the different yogas.

Speaker 1 And so actually we stopped trying to compare it to another type of yoga retreat. And instead, we looked at other things that give you the same outcome.

Speaker 1 And we actually looked at spa days and the different types of spa days available in that area, and that's what we price compared to. So, you know, always look at what your indirect competition is to.

Speaker 1 So, what alternative solutions are being offered

Speaker 1 or what alternative options to the same outcome are available.

Speaker 1 You know, we're looking at the market itself as well to look at where is the market at? You know, is it in a position where

Speaker 1 there's it's saturated and there's so many options it's untrue and then you're looking at potentially differentiating yourself from a crowd of individuals or is it you know it's well educated it's switched on to what's going on and the offers that you are providing and so it's therefore a case of you educating them on why you're the best supplier of that option or alternatively it might be the fact that it's like they're fresh as a daisy and they have no idea about the outcome that you can provide, and therefore, you are doing what I call double sell, which is where you're selling them the outcome, and then you're selling them where you are the best person to provide the outcome.

Speaker 1 So, lots and lots of options for you to be thinking around that. But the more you can research, the better handle that you can get on

Speaker 1 your market and on your audience and on your competitors, the better equipped you are to make an educated decision when it comes to your pricing. The other thing is is your opportunity cost.

Speaker 1 Okay, so where could your time be better spent? I get my clients to look at, okay, you know, I have had clients,

Speaker 1 I've got them to look at, okay, what's the minimum wage? What has been, you know, if you were to get a supervisor job in McDonald's, how much would you be being paid?

Speaker 1 And that is normally because they are over-delivering on the amount of effort and time that they are and value that they are putting in. And so,

Speaker 1 and in comparison to all that value that they're putting in, in comparison to the price that they are charging. And so, with that, I get them to look at, okay, what could I be earning elsewhere?

Speaker 1 What could I be earning in my old day job? What was my hourly rate?

Speaker 1 And very often, I get clients to work off an hourly rate so that they can be clear on, okay, well, actually,

Speaker 1 this is what I could be earning elsewhere at the same time if I wasn't doing this. This is my opportunity cost.

Speaker 1 And another thing that I've got people to do when they've been starting out in their business, because when we're starting out in our business, we are going for every single little penny that we can.

Speaker 1 and in that, we end up doing some things which are very

Speaker 1 pointless and very unfruitful. I remember I worked with an individual a few years ago now, and they'd added to their offering and jelly beans.

Speaker 1 And they were branded, and people could choose them. They could actually order them.
I think it was on something like Just Eat or something like that, or Deliveroo.

Speaker 1 And people could order them, and they would come-you know, they would actually, one of the drivers would come around and pick them up.

Speaker 1 But the thing was, was actually when we worked it out, they were getting so little for that, but yet they had to wait in whilst that delivery person, they had to get them, they had to sort them out.

Speaker 1 And the margin was so, so tiny that they've been better off doing a couple of shifts a week in McDonald's in comparison.

Speaker 1 And so some things when we're specifically money grabbing, they're not worth doing. Flipping that, you know, what is it worth to spend time with the family?

Speaker 1 They were having to wait in for these things. They were missing out.
They were being late to things, etc., etc, so that they could fulfill these deliveries and be around for these deliveries.

Speaker 1 But, you know, at the end of the day how much would you pay for family time if you're first starting out in business and you're like well you know what I don't have an opportunity cost because I don't have any other way of earning money then actually how much would you pay to spend some decent time with your family and and start with that sort of idea of you know what does it mean to you to be able to put your kids to bed what does it mean to you to be able to do other things and because that starts to then create a really different perspective

Speaker 1 Thirdly, what I would encourage people to do is to look at what does the outcome mean to clients.

Speaker 1 So, you know is it money saved and it and when you start on financial savings that obviously is it's very measurable to start off with on the get-go some things are more you know what would people be willing to pay how much would they pay for that particular outcome and you know I've seen people I've had clients do polls when

Speaker 1 asking previous clients asking current clients you know or people when they've been doing beta testers and they've been like how much would you pay for this how much would what does that mean

Speaker 1 equally you know doing polls in groups or on profiles, et cetera, where it's like, how much would you expect to pay? How much would you be willing to pay for things?

Speaker 1 It's amazing the information that you can gather off there.

Speaker 1 Obviously, you're always going to have people which are sort of high ballers and low ballers and stuff, but you can get a rough idea of the general consensus, even just going with an average or the, you know, the mode on there.

Speaker 1 At the end of the day, you know, knowledge. It is power.
It does make you feel better. It makes you feel more confident.

Speaker 1 If you've got more facts, then there's less guessing involved with actually coming up with a price so you feel more confident delivering that price because you're like you know what this is research you can say with conviction it really does it really can be as simple as that it really can have such an impact to to know that you've got facts and information to back up the price that you are charging it's also helps you be more confident if you feel challenged lots of people say well you know i'd feel funny if this person queried this or queried that and absolutely so arm yourself with the information so that if somebody was to say to you you know what hey why do you charge more than this person down the road or you know this person that I see all the time you are able to explain to them succinctly why that is the case and when you feel like that when you feel armed to be able to respond to those sort of questions it's amazing how many times then you don't get the question but that that confidence comes across with the way that you deliver the information around your pricing and if you ever did get asked that question you're not thinking oh please don't don't don't query me on this and when you're coming to it from that thought process when you're coming to it oh i hope really hope no one asks me or or questions me on this it can make such a difference and and then you know what whenever you're thinking oh gosh i hope no one questions it that's when when you do tend to bring it on yourself it's a little bit like when you when you say something on a cv as a sort of passing comment to kind of bulk it out a bit and people pick up on it so you know being better armed with information will put you in a much much stronger position will put you in a much more confident position to be asking your price and and to be confident in um what I'd anticipate if you were to do this exercise in the vast majority of cases you would be increasing your price you can be unapologetically asking for it so if you are unsure still about pricing if you're thinking you know what I still cringe I'm still not confident I feel like there's there's more to it I feel like there's potentially some self-worth stuff going on you know do reach out to me I am always happy to talk about price I'm always happy to talk around this this area It is one of my favorite topics.

Speaker 1 So, you know, please do reach out. I will help where I can and I will point in the direction of further help if that is necessary.

Speaker 1 The key thing is, is to be charging what value you are providing so that better reflects it.

Speaker 1 You're getting what you deserve and your customers are paying the price for the value that you are providing and why. not.
So that's it for me, guys, this week.

Speaker 1 I hope you have a fantastic rest of your week. And I look forward forward to speaking to you again next week, where I have another very special guest.
That's it for me, guys. Bye for now.