By The Oracles, Entrepreneur
Price is one of the most crucial considerations in any business, and it’s important to charge what you’re worth. We asked these master salespeople, including Bulletproof founder Dave Asprey and Advisors in The Oracles, how to convince customers your price is worth it — especially when you charge a premium.
1. Offer a quality product and let the market work
There isn’t a secret formula to convincing customers of your worth. Price is marked by your costs and what the customer is willing to pay, with margin to support a scalable model. Offer educational, honest information that a shopper would want. Don’t water it down. Let the market work for you, knowing you have the best products in your space.
For example, I founded Bulletproof 360 to educate others about their biology and makeup. A life of happiness and joy begins with knowing your biological, emotional, and mental state — which we can control. As I learned to hack my own biology, I found that the products I wanted didn’t exist; so I created them. The natural progression was to create the lowest barrier possible to the highest-quality products so everyone can be a high performer. After all, it’s your birthright to be the best person you were designed to be. —Dave Asprey
2. Give customers options
We buy because of emotions and justify it with logic. We don’t buy our way into something; we buy our way out of something. We don’t buy products or services; we buy stories. So ask, what emotion can you elicit? What problem can you solve? What story can you tell?
We approach purchase decisions with a yes-or-no mindset; then we focus on price. Change your offer to include three choices of increasing size. The smaller and larger options are just decoys for contrast; make the middle option the most compelling. Then you’ve shifted the question from “Do I want to buy this or not?” to “Which one do I want to buy?” Two choices are good, three is best, and four is too many.
If a prospect objects to your price, ask if they are concerned about price or results. If you can get them the results they want, it shouldn’t matter what you charge. —Dan Lok
3. Don’t try to be affordable
Trying to be “affordable” nearly killed our company. We decreased our price by 90 percent to be within reach of more people, thinking we’d make up the difference with higher volume. But it didn’t work that way. After four years of profitability, we started losing $500,000 a month. This painful experience cost millions.
I learned that people don’t care about price as much as they care about value. We tried to reduce our product from a start-to-finish complete solution to just another inexpensive option. But people buy from you to fulfill a desire or solve a problem. Deliver what your customers value. A better product leads to happier, more committed customers, which leads to positive testimonials and referrals, which drives sales.
With a higher price, you can help customers without worrying whether you’ll lose money. You’ll also have a higher profit margin to pay referral partners and affiliates. If you can pay them a higher commission than other companies, you’ll have an army recruiting customers for you. —Matt Clark
4. Choose the price that’s right for you
People don’t just buy your offering. They buy into the energy behind it, who you are, and what your company is about. When they’re deciding whether to work with you, the price is never the deciding factor.
It’s up to you to choose the price that’s right. Money only has the value we attach to it. Don’t be guided by perceived value or something outside of yourself. Always listen to what lights you up and feels expansive, and detach from the outcome you want. If you go against your instincts, your launch, promotions, and enthusiasm will be off. People are intuitive; they will subconsciously see this, which will turn them off.
The same goes for any aspect of your offering. If even a small part doesn’t feel completely on point, it will reflect in your delivery — and your sales. But when everything feels aligned, the energy you bring to it will be at 100 percent. That energy and passion are what convince customers to buy from you. — Katrina Ruth
5. Attract premium clients with premium pricing
Rather than defend your price, work to establish your company as the premium choice in your category. Luxury brands like Rolex and BMW don’t try to convince customers they’re worth it, and neither should you. Pricing is a powerful filtering and sorting tool. In our world of helping experts build a speaking brand, we never use poverty or struggle language — we use platform building, respect, and recognition language.
Many companies accept any customer who can pay. We have an application process and a waiting list. We only admit clients who will get strong results from our work. The best way to command premium fees is to deliver premium results — and ensure only the right people get the privilege of working with you. —David Newman
6. Specialize
After 15 years in the pre-employment background check industry, I’ve found that specializing in a few specific industries is the best way to combat the never-ending race to the lowest price.
By specializing, we provide a high level of expertise and customer service, along with very specific technology that caters precisely to the industry’s need. For example, we integrate directly with the government’s E-Verify platform. This is an extremely complex integration, but we offer it to our clients for free.
That means instead of a commoditized product, we are offering a suite of tools that help automate and streamline our customers’ processes. This lowers their operational costs, even when our pricing isn’t the cheapest option. With this kind of specialization, we can provide higher-quality employment screening services that aren’t judged by cost alone. —Loren Yadeski
7. Communicate the five ‘Experience Factors’
If you have to convince your customers your product is worth the price at the decision-making point, you are making this harder than it should be.
Our Expert Experience Method is a systematic way to establish the value you deliver to your clients, by getting the right content in front of prospects before, during, and after the sale. There are five “Experience Factors” that position your brand at a premium and communicate your value. You need a product of true value, proof that you can deliver results, authority status, a business presence that aligns with premium pricing, and the confidence to charge what the transformation you provide is worth.
Map out your client’s experience before, during, and after the sale and identify where you can address the five Experience Factors. For example, include client success stories in your appointment reminder emails or explain your unique method for getting results in your social media content. When you create a cohesive sales funnel with these factors, you attract clients who are happy to work with you at a premium. —Jeanine Blackwell
8. Compare your results against the competition
Clients will pay whatever they need to for results. People make decisions from fear more than success; so make sure you remind them what could go wrong if they don’t pay for quality. In the real estate business, it’s about explaining why the average agent’s results are underwhelming and exactly how my team does what we do so differently.
The average agent in my market will make less than $28,000 this year; so they need to decide between feeding their family or paying to market their client’s home. Last year, we helped over 480 families buy or sell homes, and 30 percent of those sales happened without advertising. We share those stats with confidence. —Keri Shull
