Price Your High-End Products High Enough to Make Personalized Marketing Worth It
As you learn more about personalized marketing, you may be wondering how in the world you can even afford to practice it, especially if you are going to reach out individually to your top customers and clients. If you are having those thoughts, you need to rethink your pricing strategy. If spending about an hour per your top ten (to 100) customers each month - by yourself or through your virtual assistant - seems too much, it’s possible your prices are too low.
How to Price Your Products and Services
Capitalism is a wonderful invention that has helped civilization prosper in amazing ways. However, one thing that happens with capitalism is a drive to the lowest prices. Mostly because it’s human nature to want to pay the lowest price for what they want.
The problem with this is that due to their own desire to pay low prices, many online business owners try to compete on price, and that is a mistake for any small business owner. As a small business owner, you’ll never be able to compete on price. You’ll need to compete on service and results instead.
Know What You Need to Earn
If you’ve never done this exercise, it’s time to do it. It’s hard to reach income goals if you have no idea what you really need to earn. You need to come up with a realistic after-tax-and-expenses figure. This is all part of setting SMART goals surrounding your business.
Know Your Market
You also need to understand who your market is and how much income they have. If your product is optional, the income needs to be disposable income. If your product is a truly needed item, it’s a little easier because it’s just a transfer of money instead of extra money, if that makes sense. Either way, you need to know what the obstacles are within your market to releasing the money to you.
Know the Value of Your Time
Once you know how much you need to earn to live the lifestyle you want to live, then you will also be able to assign a value to your time. One mistake some people make when they have a small business is not valuing all their time. Whether you’re sending emails or talking one-on-one to a customer, your time has value.
In general, anything you do or create that is meant for just one person, like one-on-one coaching or phone calls, is higher value over anything you do that can be to many people at once, such as autoresponder marketing messages.
Know Your Costs and Expenses
For everything you do, there is going to be an expense or cost associated with it. If you create an information product, it cost you a set amount of money to have it written, have it edited and formatted, and made beautiful for your audience. A digital product will have one set price, and the more you sell, the less per customer the cost will be.
If the product is a one-on-one type of thing like personal phone, online, or email coaching, the cost is determined by both what your time is worth and the value of the product to your customer. This type of product is always valued and priced much higher than the one-to-many options.
When you price your products based on the value they provide to your customers, you’ll likely come up with a much fairer price point that works for yourself and your customers. After all, the fewer people you need to work with to reach your income goals, the better service you can provide to the customers you have. The better the service you provide to them, the more likely they are to stick with you long term.
Thanks for reading.
Michael Camire - Massive Success Coach
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