Price Price Baby
How did you determine the price of your offer?
Go ahead. I’ll wait.
Was your answer something along the lines of… “Well, I didn’t want to make it too cheap because people would think it’s not worthwhile, but I didn’t want to make it too expensive because no one would be able to afford it and I’d have a hard time selling it, so I guess my price is somewhere in the middle”.
Sound about right?
Look, no matter what you do, some people will say it’s too expensive. And others that say it’s way too cheap.
Kind of like how some people make like $30K a year and scrimp and save to buy Louboutins. Others make $1Million a year and buy their shoes at Walmart.
Everyone’s perception of value is different, so there’s no magical price that’s going to make people jump on your offer.
So then, how do we come to a pricing decision that feels good for you and that portrays the value that you’re giving to the client?
We like to look at pricing from three different angles:
1 —> Are you comfortable with the value you’re giving for the price AND that it’s a true investment in their business — like if they actually implement, they’ll see a return on their investment. This doesn’t necessarily have to be financial. The client’s results could be more time, more sanity, more freedom, less stress etc.
If you feel you’re not getting paid enough, you’ll hate your business and burn out. It’s not fair to you nor to your clients because you won’t be able to give them everything you’ve got.
And if you know that they won’t get 10X’s what you charge in value, there will be an imbalance in the relationship.
2 —> Your price needs to drive a profitable business and help you meet your financial goals.
Here’s a simple formula for pricing your offer that takes the particulars of your business into account and how you want to grow it:
Price = People Costs + Process Costs + Profit
Add up your people costs. Think about every person that you’ll need to pay and scale your offer (including yourself!).
Add up your process costs. Go through and list any tools, travel costs, or supplies that you’ll need to deliver your offer. Sum up those costs and divide by the average number of clients your serve at any given time.
Add in your desired profit margins. The amount of profit you’ll want to add is dependant on whether your drawing a salary from the business, or whether your living off your profits.
Your Offer Price = (People + Process) / (1 – Profit %)
***Note: I used to be a math major, so if you need some help with the equation, just comment below and I’ll give you some help 🙂
3 —> Whatever price you choose, your messaging needs to make it clear the value that you’re bringing, who it’s for (ie – who will get the best result), and it will speak to the person that you most want to work with.
Messaging is the difference between attracting people who will think it’s too expensive and those who will say “Wow! What a bargain!”.
Messaging is the difference between feeling like you need to convince people to buy and people coming to you compelled to purchase.
Messaging is the difference between having to change your offer for everyone who walks through the door (ultimately leading to burn out) and being able to create something scalable that serves your clients powerfully.
So, if you’ve been struggling with how to price your offer, consider these points and you’ll be well on your way to finding that affordability medium with your clients AND meeting your long term financial goals.
And whenever you’re ready, here are a few ways we can work together further…
Join our free group
My favourite thing to do is to hatch client creation strategies and I often shares the behind-the-scenes strategies we’re working on inside our High Ticket Selling Lab group. Click here to join.
Watch one of our free trainings
We currently offer two free on demand classes. The first will help you create a pipeline and fill it with qualified leads. Click here to watch the Prospecting Class. The second class will help you close more sales in 5 simple steps. Click here to watch the Closing Class.
Join our Sales Appointment Mastery Program and become a Case Study
I’m putting together a new case study group this month that will show you how to book more sales appointments… stay tuned for details. If you’d like to work with on a process for generating more sales calls online, just message me here with “Sales Appointment Mastery” and I’ll send you the details.
Work with me and my team privately
If you’d like to work with me and my team directly to help you build a 6- or 7-figure business, just message me here with “Private” in the subject line and tell me a little bit about you and your business. I’ll send over all the details.
And also, if you’d like a free copy of my book that shows you the 12 Foundations to build a business that is fun, fulfilling, and financially freeing you can grab that here: heatherprestanski.com/book