I recently asked some people this question, but I want to ask you personally:
“What would happen if you doubled your prices and lost half of your clients?”
Depending on your experience, industry and underlying beliefs, you’ll have a different answer to that than the last person I asked. I get different answers all the time.
People often get caught up in the fear or concern they feel when they hear this, instead of leaning into the positivity and excitement that comes with it.
But when we start going through that process of raising our prices as business owners and entrepreneurs, we challenge ourselves. And I’ve successfully helped my clients raise their prices from 30 to 100 percent.
(If you need help with that, I’m here.)
Yeah, if you were to double your prices today, you’d probably lose a handful of your customers. I’ve yet to see other people who do the same actually lose half, though.
Odds are, even if you did end up losing half, you’d end up with the same revenue, half the clients and be able to do half the work you were doing before.
You’d basically be working less and getting more revenue from your efforts.
I highly recommend that you start thinking through this.
A lot of the time when you haven’t been charging the right value for what you have to offer, you’re looking at your competition’s pricing. You’re letting that dictate what you’re doing. That means that you’re hurting yourself and your customers.
When you don’t charge enough, you’re not able to charge the highest level of value.
The lower your price– like when you’re always pricing yourself as a commodity– shows your audience that they aren’t going to get value out of what you’re offering.
Why would you do that?
I know I’ve mentioned this example before, but it fits really well here, so I’ll mention it again:
There was a group of people who did an experiment a while back. I’m pretty sure different variations of this same experiment have been repeated a handful of times.
They brought in some wine enthusiasts.
Those wine enthusiasts went into a room together and saw three bottles of wine– one bottle was $10, one bottle was $50 and one bottle was $100.
Every single one of those wine enthusiasts agreed that the $100 bottle tasted the best.
Finally, they showed the enthusiasts the real labels of each bottle. Lo and behold, they were all the same bottle of wine.
The point? Every time, people have a better experience when the prices are higher. Value dictates experience. Price dictates value. End of story.
If you’re not at a healthy profit margin, and you feel like you’re just running around and working on way too much without seeing much reward, a lot of the time it’s a matter of pricing.
What are you thinking right now?
I’ve heard plenty of folks tell me, “Oh, in my space, we can’t do that. People won’t pay that price.”
That’s not totally true.
The right people who are the right fit for what you have to offer will certainly pay a particular price to get a particular value.
With increased pricing, you have more revenue. You can provide a better client experience. You can go above and beyond for your client base so that you get to take better care of them.
But you can’t do that if you’re priced low. You can’t do that if you’re priced at the bottom of the barrel.
So today, I want you to reflect on the fact that if you’re not profitable enough, it’s time to take a look at pricing. I’ve gone through this exercise dozens of times over the past decade or more now.
I can promise you that it’s relevant no matter what’s going on in the world, and no matter what your marketplace has been looking like lately.
So if you have any questions about this, just shoot me a message by clicking here.
To your success,
P.S. We’re getting closer and closer to the official launch date of my new book, Atomic Words, as we wrap up the month of March.
Before we get there, I’m offering exclusive and free bonuses when you pre-order a copy (or copies!) of Atomic Words.
I’ll talk to you more about that later this week, but in the meantime, you can click here to pre-order your own and lock in those exclusive bonuses.