Influential Voices of Authority Case Study: How To Set Your Price - Episode 119
Case Study: How To Set Your Price - Episode 119
If you are like me, and many others in the online space, you struggle with pricing. You don't want it to be too low and leave money on the table. On the other hand, you don't want it to be too high and not make any sales.
So, where do you set the price?
Pricing is tricky. There is a lot of art to setting your price. Most is trial and error.
There really is no “correct” price. Price is determined by supply and demand. The price of anything is that point where a seller is willing and able to sell AND a buyer is willing and able to buy. It is a continuum.
If a seller is not making much money on a sale, she will focus on another area of business that is creating more profit. If she is a public speaker on self defense and earns $2,500 per speaking opportunity on the weekends, she is creating decent income.
If she then creates an online course teaching other women self-defense and creates sales of $3,000 per week with an hour of work online marketing the course, she may opt to do less speaking and more work online.
Her speaking gigs require her to find clients, travel to the location, give the presentation for an hour or two (depending on dinner and other presentations), possibly spend the night, travel home and miss time with her family. That is a lot to give up in order to make $2,500 when an hour a night on her schedule could earn $500 more.
People may be willing and able to buy her speaking at$2,500. However, she may not be willing to sell it for that. She may do a few speeches. It may just be less frequent. If her price increases to $5,000, the decision may be different.
HOW DO YOU DECIDE?
When I began coaching podcasters, I came to that very problem. I was in that place so many entrepreneurs find themselves. A price needed to be set for my services.
What would podcasters be willing and able to pay that I would be willing to accept?
So, how do you set your price.
In this episode, I walk you through the steps I took to determine the pricing for my podcast coaching.
OVERVIEW
First, ask your customers what they will buy. This could be a survey of your list. You could simply study the market and determine what they are already buying. Find a few people that could use your help and ask five or ten of them.
Next, determine what problem you are solving for your audience. People buy benefits and solutions. People don't buy mops. They buy clean floors. Solve a problem they know they have.
Then, price on value. Know what value you have to offer. Your experience, knowledge and ability all play into your value. This will determine why it should be you rather than anyone else.
You can now set a price by looking at the market and seeing what they charge. Buy a few similar products to see what is included if necessary. You want your price to be competitive, but not necessarily the cheapest.
Your price does not need to be less than everyone else. It should probably be more expensive than others in order to stand out. Make it a great value for the price to justify being at the top end.
If you tell your audience what to do, you can charge a low price. If you teach them how to do, you are able to set a mid-level price. When you do it for the, you can be at the high end.
To be at the top of the range, go all out and solve all of their problems. Be a full-service machine. Prove the value and then add a bit more.
Most importantly, have a sales process. Know how you will attract people to your process. Define how you will demonstrate your value and benefits. Give your audience a ton of value, then the opportunity to buy.
I am not guaranteeing you will make money. I am not promising you that you will get rich, or even make a dime for that matter. I do not know you or your abilities.
I am saying this process worked for me. You may find a few helpful tips here that could help you in some way.
If you show your visitors the value of your product or service while giving them more than they expected, there is a good chance they will buy.
As in my example, there are times when the price doesn't make sense. This is when you need to review your process.
Is the issue the price tag as it was with my program at the beginning?
Does the roadblock appear due to the structure of the product or service as it did with my 12-week program rather than weekly calls?
Are your clients looking for a product or service tailored to their needs, like my calls ever other week?
Rather than launching your product to thousands of people at one time, launch to a few. See if they are interested at that price and value. Gather some feedback. Make adjustments. Launch again to a few more people.
As you adjust your sales process, you will find a spot where clients are willing and able to buy your product at a price you are willing and able to sell. If you are not selling enough, add more value or lower the price. If you are selling too much, raise the price.
Tinker until it feels right. There is no correct price. There is only a price with which you are comfortable and that pleases your audience.
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