Want more money for the same amount of work?
Easy. Just raise your prices.
But Jacob, you say, won’t that just drive away my clients, and create some resentment with the ones who stay?
Well, yes, if you simply raise your prices and don’t change anything else. Do that and you’d better expect a few people to hurl insults in your general direction (though not always, as you’ll see).
But look, you don’t have to make a lot of big, hard changes in order to increase your revenue. Just a few thoughtful ones, and I’ll tell you how.
We’ll start with a serious joke:
Q: What’s the difference between a good salesperson and a smart one?
A: The good salesperson sells ice to an Eskimo. The smart one sells ice to a Bedouin.
There are a bunch of golden lessons in that little joke. The big takeaway is that you have to think about how and why people make purchasing decisions.
Between our two sales professionals, the person selling ice to a Bedouin probably charges more and has an easier time. No surprise there. But there are plenty of examples closer to home.
Business people will pay more for an accountant than truck drivers will. A truck driver will probably pay more for some things than a business owner.
The bars in Los Angeles seem outrageously expensive to a visitor from rural Nebraska, but they’re cheap to someone from Tokyo.
(By the end of this post, some of you will be buying me drinks in the expensive bars of L.A. But I’m getting ahead of myself.)
The Market doesn’t control price. You control price
Price is relative, and you can ask a lot more money for the same product or service if you pay attention to where and to whom you’re selling it, and how you’re packaging and presenting it.
We’ll get back to that, but first there’s another phenomenon that I call Raise Your Prices Without Doing Anything Different (RYPWDAD).
Gary Halbert has this great analogy that price is like a 10-story building with rubber ceilings. You’re on the first floor with a long spear.
You poke the ceiling with your spear, and eventually it breaks through to the next level. From there, it’s easy to move the spearhead from the floor to the next ceiling, and then you come up against resistance again.
The idea is there are price ranges in what people are willing to pay. If you sell something at $199 you might make just as many sales at $299 and 399, until you hit the next ceiling at $400. Then you have to change something to break through.
The moral of the story? Test higher pricing until you’re right at the resistance level. You’ll could make just as many sales at $399 as you would at $199.
Now we get to the big question. How do you break through that ceiling?
I think you can already answer that. You try selling to a different demographic. You vary your offer, your copy, your packaging.
Maybe you vary your attitude, too.
Creatives’ Syndrome and other pricing problems
I recently got paid $5,000 for some writing that I would have gladly done for $500 two years ago. I have put a lot of work into becoming a better copywriter, but I doubt I’m 10 times better than I was two years ago.
Instead, I got very lucky and stumbled upon something that was right under my big nose for a long time.
This is a problem that hits creatives really hard. It also affects coaches and marketers, and just about anyone who’s job is to enrich other people. It’s the idea that if someone can afford to pay me a multiple of my current fees, they’re obviously successful already, so they don’t really need my services.
If this is something you struggle with, I recommend Joel Block’s book, Stop Hustling Gigs and Start Building a Business. I got some personal coaching from Joel Block, and he told me something priceless.
The most successful people want your services even more than their less successful peers. They’re successful because they know certain things. They know that if someone is comparing them to a competitor, they just have to look 10% better to get 100% of that sale.
They know that if you can make them just a little bit better, they could get 5-10 more clients–and that would pay back their investment in you ten times over.
Now, what if “Creatives’ Syndrome” isn’t your issue? What if you feel totally comfortable charging a lot more, but your challenge is getting customers and clients to pay the higher fees?
Then it’s a matter of finding the spearhead that will break through the ceiling. The quickest way is to build on the work you’ve done already, and package it to increase the perceived value.
You offered the ebook, so now you build an online class. Next you make it a live class. Now you create a Done For You product so your clients can pay you to do the work you just taught them how to do themselves.
What would you need in order to charge $5000 per person for a live event? Do you need to attend one to understand? Or just watch Tony Robbins and take notes? You can get rich by asking these and similar questions.
I’m going to end this with a challenge for you. Actually, there are three steps.
- This month, pick one product or service you already offer. Increase the price by 20%, 50%, or even 100% and see what happens to sales.
- Pick another product, and think of 3 ways you could charge ten times as much for it. Try all three.
- If you create a big jump in your income over the next 30 days, you can thank me by telling everyone you know to subscribe to Bold Words. If you’re in Los Angeles, you have to buy me a beer, preferably a porter or a stout.