Well, how should we choose a price for what we have to offer? And if I asked you that, what would your response be?
How do you go about choosing a price for what you have to offer? And this is where a lot of people say “charge what you’re worth”, but how much you price doesn’t actually mean anything in terms of your worth as a human.
What you need to focus on is the value of what you have to offer to your ideal customer.
This is going to be different depending on what your business is and what your different offers are. Value can be joy, time saved, convenience, money saved, money created, improvement of health, avoidance of harm, access to you or others, social status…
There are so many different elements and different ways that we can provide value to our ideal customers, through our products and our services. This is what we need to focus on communicating in our messaging.
We are always going to be too expensive for some people. And it’s funny because you might think, well, the lower I charge, the less, this will happen.
But you are always going to be too expensive unless you are free. You cannot cater for everyone. And nor should you want to. You need to focus on actually creating a profitable business that is sustainable so it can keep going running.
I want you think about the type of value that your products or services offer. What does that look like for you? And what does that look to your ideal customer?
How to choose a price
I know we can spend a lot of time trying to figure out our pricing. And the thing is there is no right answer and your pricing will more than likely change (and increase!) over time.
It is important to understand the market, but it doesn’t mean that you need to fit in with the market. So I want you to understand where others with a similar offering are pricing and then think about where do you want to sit? And like I said, you can set a whole new price away outside of the market too, but it’s important to understand the market that you’re playing in.
Then I want you to actually think, what would feel fun for you to charge? What feels great to you for the exchange of your products or services for money?
And then remember that pricing often goes up over time because of your skills or your experience, your confidence, realising the profitability and how probably your original prices weren’t allowing a lot of profit in your business.
Don’t make assumptions about your customers
Do not make assumptions about what your customers can afford. It’s very easy to assume they will/won’t pay based on what we would/wouldn’t pay.
But it’s also rude! Imagine if you wanted to go into a shop and the shop owner said “sorry, you won’t be able to afford anything in here”.
Remember you are not your ideal customer and just because you might not pay that amount does not mean that other people won’t.
So tell me: What has been your biggest pricing lesson?
If you are ready to take your business to the next level, to connect with your audience, attract more of your ideal customers, and make great money, without meaning you need to sacrifice your lifestyle in order to grow, my free online class is PERFECT for you. Go to emilyosmond.com/free to register!
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I acknowledge the Wurundjeri people as the traditional and ongoing custodians of the Kulin Nation: the place in which I live, work and play, and pay my deepest respects to their Elders past and present.
Emily Osmond is an international business coach and speaker, based in Melbourne, Australia.