Are you pricing yourself out of the market? Well, are you?
“Am I priced too high?” That’s the initial reaction when I ask this question (which I tend to ask a whole lot). Most of the time, it’s quite the opposite – my clients and many professionals out there are pricing themselves so competitively low that they’re shooting themselves in the foot.
When one starts out as a certified coach, we’ve already gone through the work of obtaining the necessary paperwork and jumping through the ICF hoops. We’re excited to get started so we start tinkering with our niche and target market (subject to change every 12 minutes) and we put our little sign out on the web and wait for people to come filing in.
This new world often shocks those who come from a corporate background. The businesses we came from often delivered tangible, fiscal results that we could see very easily. Now, we’re seeing intangible, subtle changes in our clients; it’s only natural that this new abstract world is difficult to grasp -- especially when it comes to pricing.
Integrating Your Experience
I was in real estate on the title insurance side for 28 years. I worked corporate and as an entrepreneur for all those years. Working corporate was the last thing I wanted to do after finding my niche in adventure coaching.
I remember having conversations with fellow coaches that sounded like, ‘I just want to coach people who want to get out of their comfort zones who always want to be climbing or jumping out of something.’ I believe in adventure coaching, even more so now after I’ve been doing it for all of these years.
My mentor coach constantly told me that with all the business experience I had, it was impossible for me not to bring that to the table with prospective clients. She insisted that I was bringing all of my life experience to the coaching conversation, so I shouldn’t box myself within the confines of the coaching certification.
It made perfect sense. That idea – that I wasn’t just a coach; that my past hadn’t suddenly disappeared when I got certified – shifted my perspective when I needed it most.
God has an amazing sense of humor. 90% of my clients were coming to me for business coaching. I wasn’t deliberate about avoiding it. I was able to incorporate the adventure element to work around fear and comfort (which is what I wanted and what they needed) and I was able to help them with their businesses using my own experience and expertise (which is what they wanted). It was a textbook win-win.
Having said that, I still felt like a greenhorn. I priced myself according to the standards of anyone without a testimonial to their name.
Early on, I’d invested in coaching with the amazing Bob Burg (he wrote “The Go-Giver” with David Mann). During our first mastermind session, he suggested that I rework my website and double my prices on day one. It was one of the most uncomfortable requests I could have ever received. I wanted to fall in line with the coach, though. I was sure he knew best.
When I got back to my hotel room that night, I sent out the request for the web developer and had the prices doubled.
On the second day I was pulled into the “hot seat” during the mastermind session. I was proud of what I’d done – to so boldly double the package prices and assume things would work out. I figured I was on the way to a better coaching career and felt valuable.
Bob was proud, too. He gave me kudos, then dropped a rock on my head.
“Great job, tonight double them again.”
Out of control. I couldn’t believe that he was asking me to pull that bandaid off twice. We’d been coaching for some time. He knew all about my journey and was abreast of the results my own clients were getting. He knew I was ready and able and worth it.
I remember what he said. It echoes in my head every time one of my clients slashes value through their pricing.
“I know you’re always going to overdeliver in value to your clients but make sure you are not undervaluing yourself.”
I’ve never forgotten it. Since many of my clients are coaches themselves, this is one of the greatest lessons I’ve been able to pass on to them.
Perceived value is a real thing. I always use the example that if my husband was out shopping and he saw two of the exact same items, same description, same EXACT item, side by side and one costs $5.99 and the other $19.99, he will choose the more expensive one. Even when I’ve called him on it, he retorts with ‘there’s a reason this one is more expensive’ and he gladly pays the higher price.My husband isn’t a special case here. Most people follow the “you get what you pay for” rule.
And that’s why you can’t just jack up your prices and expect people to pay. No matter what your pricing is, you always have to over-deliver in value.
The Value in Benefits
We are never selling our product or service, you’re just offering prospects the benefits.
As a coach, I don’t sell coaching, I offer results.
If you’re a photographer, you don’t sell photography; you offer a lifetime of memories.
If you’re in marketing, you don’t sell posts and pictures – you offer higher sales figures
So ask yourself this question: “What do I have to offer and how much is it worth to the end user?”
Really mean it. Don’t talk about your features or how cool your product is (unless it makes your target feel cool and that’s the product itself). Think about how that person’s life will change for the better when they’ve invested in what you’re good at.
There’s a new(ish) show on Netflix called “Living With Yourself”. I highly recommend at the very least the first/pilot episode. In a nutshell, it’s a great example of how little the price matters when someone is in dire need of change, dedicated to the results they desire and willing to invest in themselves. That’s truly where the magic happens because very often, their results are correlated to how much they are willing to invest in themselves.
How many times have you heard someone say ‘people don’t value what they don’t pay for?’ Well, for someone who did a LOT of coaching for free and a LOT of discounted coaching at the beginning, I can tell you this worked against me and what’s worse, is it worked against my clients as well. What I thought I was doing to help them, actually ended up hindering them.
If I can make a few suggestions, I would say:
- Continue to work and master your craft. No matter what product or service you offer, make sure you are at the top of your game and continue to invest in yourself as well so that you can be the best in your industry.
- Always over-deliver in value. I don’t care if you are charging $5,000 or $1,000,000 a year for your product or service, make sure you are always providing much more in value that you are charging for.
- Stop devaluing yourself. Build enough confidence in yourself so that you can walk in your valuation proudly when discussing your pricing with your client. This should never be an uncomfortable conversation. If it is, practice until it’s comfortable. Trust me, you are worth it and should be making the income you deserve.
Remember, it’s working against you to undervalue your service or product. Charge what you’re worth and stop discounting yourself out of the market.