Small business owners are looking to have their businesses be in higher demand. What they typically do when they want more customers or sales is to either use marketing hype, create false scarcity, exaggerate their products or service claims and put sales pressure on their customers. It’s pretty typical for companies to panic when sales are down and to believe they are charging too much for their products or services and then to panic and rush into discounting their fees.
I’ll share the story of how this worked for a client of mine who believed his consulting services were priced too high. He thought he had to reduce his rates and offer a special promotional discount. I told him to do something outrageous instead!
Want to Grow Your Bottom Line? Increase Your Prices!
I said to my client, “I want you to immediately charge double the prices you were charging”. At first he clearly thought he had hired a very crazy consultant for business mentoring who was out of her mind. Then he told me he hired me for my marketing strategies so he would “reluctantly” listen to me. I think he still thought my small business advice was going to hurt small business owners. He listened anyway when I shared my own true story.
I used to be a lower priced management consultant when I first started out. I had a hard time selling clients. Then I decided I would position myself as a high priced consultant because I wanted to be the Rolls Royce of the industry. After all people can buy a car for a lot less than a Rolls but owning a Rolls Royce means you have the best. I wanted to be the best in my industry. I also knew that I’d have to be sure my clients got what they paid for and that the business solutions I delivered were going to be effective for them. The more value I could add the more I could charge and ultimately the more profits I could make. Profits are important to me since I fund a foundation with a lot of my income (www.TerriLevineFoundationforChildrenwithRSD.org)
I doubled by fees and spread the word loudly about my price increase. Clients didn’t go running away and prospects flocked to me instead of running away. People assumed this high end management consultant, executive coach and business coach was worth the money. I didn’t give discounts unless people were paying in full. I never negotiated against myself like so many small businesses do. They fear they won’t get the sale and quickly reduce their prices and offer discounts. I did not.
Core Unique Positioning
The only thing that kept my client fefearful of raising his fees was that he was afraid he was going to lose his current customers and that prospects were going to run the other way. I shared my story and also shared how many of my clients had used this strategy to position themselves as celebrities – not authorities – beyond authorities – in their fields.
Once we got passed his fear we launched into the marketing strategy and doubled his price. I crafted his Core Unique Positioning statement and then framed all of his promotions around his high-end consulting. I knew my client. I knew he created tons of value for those who worked with him. I also knew that most people didn’t know of him and if they had heard of him they perceived him as a low end consultant. Using my Guerrilla Marketing strategies, that are low and no cost, I spread the word through viral videos, Facebook ads, syndicated articles and blogs, interviews, forums and webinars. His position of being worth every dime he asked for was planted in the minds of prospects.
People began to know him and like him and because he delivered great educational content they quickly trusted him and most importantly they wanted his high-end, high-priced consulting. Remember, before he was struggling to get clients and now he had become the in-demand consultant who people were happy to invest in.
This is exactly how you magnetize. I believe your business can double or even triple if you follow what I’ve shared. Are you willing to give it a try? Let me know about your experiences in your comments!