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Executive summary: It's because you messed up.
My CPA told me one day that there is nothing more important than price. If I want more sales, I should lower my price, because nobody is going to pay more for the same thing if they know about a lower price.
What a cute idea. I have a product I charge $625 for. I noticed one competitor charges $100 for "the same thing." Well, they claim to get the same job done anyway.
Guess what? My company has 30% of the market, state wide, in that product. Why doesn't the person charging $100 have the whole market? I'm obviously committing a crime! Charging over 6 times more! Deplorable!
The truth is, people could give a rat's tail what you charge, as long as they can afford it. Companies will pay you $50,000 for something they need without batting an eye. Individuals might pay you $3,000 without a second thought. The key is:
Discover what people really want (hint: they'll either tell you, or their actions will tell you).
Design everything in your company to interface well with your buyers (hint: make it easy and make them smile).
Improve your products and services until people refer their friends without even being asked (hint: when their friends praise them as a genius for referring you, you're partway there... keep on truckin').
Ok? So please don't listen to my CPA on this issue, even though he's excellent at what he does and a super nice guy (he really is!). Don't listen to yours either, or your aunt Karen, or whoever is trying to beat you down on price.
Find the part of the market that wants what you can deliver, and maximize value for them.
If you can't charge multiples over the so-called price leader in your market, and still take more share than them, take a closer look at what you're doing!
My CPA told me one day that there is nothing more important than price. If I want more sales, I should lower my price, because nobody is going to pay more for the same thing if they know about a lower price.
What a cute idea. I have a product I charge $625 for. I noticed one competitor charges $100 for "the same thing." Well, they claim to get the same job done anyway.
Guess what? My company has 30% of the market, state wide, in that product. Why doesn't the person charging $100 have the whole market? I'm obviously committing a crime! Charging over 6 times more! Deplorable!
The truth is, people could give a rat's tail what you charge, as long as they can afford it. Companies will pay you $50,000 for something they need without batting an eye. Individuals might pay you $3,000 without a second thought. The key is:
- positioning yourself as a person/company they like and want to buy from
- establishing trust
- giving them what they need
- amazing them with the preposterous level of value you're willing to deliver
Discover what people really want (hint: they'll either tell you, or their actions will tell you).
Design everything in your company to interface well with your buyers (hint: make it easy and make them smile).
Improve your products and services until people refer their friends without even being asked (hint: when their friends praise them as a genius for referring you, you're partway there... keep on truckin').
Ok? So please don't listen to my CPA on this issue, even though he's excellent at what he does and a super nice guy (he really is!). Don't listen to yours either, or your aunt Karen, or whoever is trying to beat you down on price.
Find the part of the market that wants what you can deliver, and maximize value for them.
If you can't charge multiples over the so-called price leader in your market, and still take more share than them, take a closer look at what you're doing!
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