Most business owners take a well-meaning stab at trying to guess their value — “I’ll price this at…*consults Magic Eight Ball*… $500?!”
But the clammy, icky, nobody-loves-this-part truth is this:
If you’re guessing, you’re already losing.
Don’t throw your fees against the wall to see what sticks. Instead, use my pricing trifecta to price your services like a pro.
Let’s go!
1. Calculate.
In order to be able to sell what you do, you have to understand what it’s actually worth to your customer.
A health coach developed a marketing strategy to build her practice. It works like a charm to build the know, like, trust and “buy” factor with potential clients. She invited others in her industry to test it and it consistently proved to net 1-2 new clients each month.
So she decided to develop it as a program with a joint venture partner to teach her innovative lead generation strategy.
In addition to the core program, they planned to include 2 months of bonus content that supports the core system. That’s eight weeks of original topics that create the value their customers’ prospects are after. Just like a few Barry White songs work wonders to “set the mood.” 😉
(Without giving away specifics of their program, it would be like teaching you the secret to setting up your own online store and including 8 pre-written articles that drive people to buy your goodies so you get guaranteed sales.)
B/C (Before Coaching), they intended to offer this core program, plus bonus content, for $100. 💵
- If 5 people buy, they’ll gross $500. Barely worth it.
- If 50 people buy, they’ll gross $5,000. Better.
- If 500 people buy, they’ll gross $50,000. Much, much better.
That’s a common way to package and price training.
But when she first described the offer, the bonus and their rationale for the pricing, I recognized they were missing out on significant revenue potential—because they hadn’t factored the value of 1-2 new clients per month 📆 into their pricing.
At the very, very, verrrrrrry minimum, for even the newest of newbies in their target market, one client is worth at least $500. Closer to $1000. And for someone more experienced, fees could go beyond $5000 per client.
Because we tend to see what we are earning instead of what we aren’t, they were about to make a pricing misstep that would’ve cost them hundreds of thousands of future dollars in potential revenue.
2. Communicate
You need to formulate and express your unique value with clarity and effectiveness.
You may be inadvertently positioning your value in the wrong way altogether — because the way you present your cost is just as important as the cost itself.
My health coach client’s original plan to throw everything in for a single $100 fee and call it a day was based on their perception of how much they thought a 60-minute training should cost.
But they hadn’t factored in what it would take for clients to create the content themselves, therefore overlooking another chance to charge more.
And if every client you accept actually loses you $1,000 — then over the course of a year that could very well be a minimum of $10,000 in free oh-sh*t money that you’ve accidentally just let slip through your fingers. Not because you’re foolish or ill-equipped, but simply because you were having the wrong conversation.
Even if customers followed the core system, it would take weeks and weeks and weeeeeeeks to create that same content on their own—assuming they even had the specialized knowledge (and discipline) to pull it off. Which, since many are new business owners, very few have the ability, know how or bandwidth to develop it themselves. Any copywriter creating the weekly content alone on the free market would charge a minimum of $200 per month.
When I spotted this additional oversight, I recommended putting a twist on the razorblade pricing model by offering a subscription model instead.
The “razorblade” reference is based on Gillette’s model of selling inexpensive razors, and then charging additional fees to keep refilling it with fresh razorblades, btw.
So instead of making a one-time sale of $100, they’ll earn that from each client every single month by offering the core system *the razor* and 4 weeks of fresh content every 30 days *the razorblades*. Make it rain!
This puts them in a position of receiving monthly recurring revenue that adds up to $1200 per client, per year. Much better than $100 and done, obvi.
💵 vs. 💵💵💵💵💵💵💵💵💵💵💵💵
Let’s do the A/C (After Coaching) math on this pricing model:
- If 5 people buy, they’ll sell up to $6000 per year. Possibly worth it, but still a fair amount of content creation for $6k.
- If 50 people buy, they’ll sell up to $60,000 per year. Definitely worth it.
- If 500 people buy, they’ll sell up to $600,000 per year. Hello, Summer In Europe and Ponies For The Kiddos! ✈️ 🇪🇸🇵🇹🇫🇷🏴🇩🇪 🐴🐴
For the record, don’t interpret this example as advice that you should create this model for yourself. No way, no how. Subscription and membership programs take a lot of work to maintain. Creating fresh content and keeping the community engaged by delivering a high, high, high level of value is NOT for everyone. But in this case, it’s ideal for this pair. 👯♀️
3. Command
You must believe how much you say you’re worth.
While part of this issue stems from a lack of confidence in asking someone else for the money, the other part happens way before you even get to that point.
That challenge is this: not understanding your value in the first place.
Most women are either out of touch with — or too modest about — the real value they offer. As a result, we’ve got some of the world’s most talented, smart, with-it women, out there charging pennies on the dollar for what they really should be making.
They were about to fall into a “pennies on the dollar” trap based on a B/C assumption that their target market wouldn’t be willing or able to afford anything over $100 because so many are new business owners.
When my client relayed my recommendation of a subscription model, her JV partner liked the idea, but resisted the $100 price point and countered with a $35 intro price.
With a little coaching, my client was able to recognize the true value of their offer and command the price. But she had to sell her JV partner on it— so here’s an excerpt of the note my client ultimately wrote to convince her partner to command the price as well:
“…they’ll get 1 or 2 clients per month from this if they follow exactly how we laid it out. It makes sense to be charging those prices and really believing in our value. It’s written out, no research necessary. And they don’t have our view or education. I think there’s lots of value in that. I honestly feel each topic is worth $50! You couldn’t get it cheaper…What do you think?”
The JV partner wisely came back with a yes. Kaching!
The hard pill 💊 to swallow though — is that most women build their entire business around nothing more than conjecture — and a jellylike understanding of their value.
Although you might have a fuzzy sense of it — you must have the real deal knoooooowing that goes with truly nailing your ability to calculate, communicate and command what you’re truly worth.
You could be earning 2x, 5x, 10x more — just by making a few simple tweaks to what and how you sell yourself. And stop having nightmarish cold sweats, just at the mere thought of getting on the phone with a prospect to discuss your prices. And be confident about the way you are positioning your services so any price you ask feels reasonable. Natural. Elicits the YES.
This is my absolute favorite part of creating sales strategy.
In fact, a client recently increased her sales by 66% from November to December—and held that increase again in January. This was after we reengineered her pricing plan and revised her approach to the sales conversation. These changes poured fuel on an already “on fire” business strategy and as a result, put her on pace to break 7 figures this year.
If you want me as your thought partner to create the strategy for one of your offers, book a Money Momentum Month today—where we single out one of your packages and determine exactly what to do to milk more sales out of it—while delivering maximum value to your clients.
Use Promo Code ‘CCC’ to save a chunk o’ change on yours through February! ❤️
Nail this down — and you’ll command ambitious money for the work you do — without flinching or (woefully) being taken for small potatoes, ever again.
