Updated: Mar 7, 2021
If I had a pound for every time I heard, how much should I charge? Well, I'd have quite a few pounds by now and an additional revenue stream. But the reality is that people get really confused over how to price their products. Whether that's one-to-one coaching, a course program, a one-off workshop or any of the other things that you could have in your armory. Some people just get stuck on this. When you're coming up against this question for the first time, it's really difficult to understand how exactly you price your products. Well, if you've ever wondered, then this episode's for you, we're going to be diving in to how should I price my product and all the things that come with that.
We even jump into the specifics of actually pricing it. Let's be honest about what the problem really is. The problem is that we have deep seated money mindset fears and issues that come up when it comes to pricing our products. Why? Because really we're not just pricing our products, we're pricing ourselves. If you're anything like me, you've sat there with this great idea of something you want to offer. Something, you know will really help your ideal clients and you've just got this fear about the minute you put a price on it, all kinds of problems are going to crop up. Like no one will buy it. If I put this price on it, no one will buy. The humiliation of having a product that doesn't sell.
The reality is that it's just some really typical fears that come up for all of us. Especially when you're in your first year of business.
Like who am I to charge this? Who am I to expect someone to pay me all this money for me to do something for them?
Will I be perceived as greedy or money grabbing has certainly come up for me. The other one that comes up a lot for myself and people I work with is “If I charge this what's expected of me, will I under-deliver and embarrass myself and have dissatisfied customers or conversely, would I kill myself trying to over-deliver?” Well, my first question to you is have you ever created a transformation before for either yourself or for someone else in the area that you're trying to teach or coach? Do you believe you can really help your ideal client make that transformation from the pain point that they currently are to the place of where they need one or desire something that you can help them with?
Well, if the answer to either of those questions is yes, then you have the duty to serve and actually charge your clients. Now, bear this in mind. When it comes to people seeking transformation in their lives...
When people pay, they pay attention.
Now it's so true that whenever you're given something for free, you mentally devalue it. Indeed, if you haven't paid very much for it, the same thing goes. But when you part with money, and money that you consider to be significant, now you're listening. You're not going to waste a penny. Now I took part in a program a few months ago and I felt it was excruciatingly painful at the time. I just left my job in corporate. I'd been laid off. I didn't have a lot of money and I certainly didn't feel like I was abundant at the time. So to part with that amount of money for a program felt really uncomfortable, but it was just that discomfort that meant I showed up to every single live training session.
I did every piece of homework. I did everything that they asked me to do, even when I felt uncomfortable, not least because I had paid a lot of money. At one point, I even calculated how much each of those meetings that I was doing cost and I wasn't going to miss a single one. Because of that massive transformation happened for me. I really committed. Perhaps it's the same for you. Sometimes it's put that the transformation starts with the transaction, the mere fact of actually laying down that money states a real intention that you intend to have that transformation actually happen for you. It's exactly the same for your clients. In fact, if you charge too little, their incentive to make an effort actually reduces. So just think about it like this, you're actually doing your clients a disservice if you undercharge.
Now about the point of under-delivering and over-delivery:
Beneath all of that is the fear of not being good enough which shows up for so many of us.It's always rumbling away in the background, sabotaging us when we try and level up.
As long as you know it's there, you can address it. Now, you may want to undercharge to mitigate against any perceived lack that you have in your own service. That's completely normal. You're worried that you won't do as good a job as you wish to because you're new. Perhaps you haven't done it many times before. Don't worry so much, it's normal. Provided you have faith, you show up and give a hundred percent effort. Please don't worry that you're going to under-deliver, the mere fact that you're worrying about it this much says to me that you are going to deliver masses of value to your clients. They're going to be really grateful for having worked with you.
The flip side to that is the need to over-deliver to a massive extent. You want to over-deliver unrealistically in order to feel worthy. Of course, there's massive problems associated with that. If, for example, you consistently find it hard to get off of your coaching calls on time. Instead of delivering the 60 minutes that you were contracted to do, you're still there after an hour and a half wondering how am I going to get off this call? It's not going to be long before you start to feel resentment towards your clients.
Trust me, the energy that you bring, if you're feeling resentment is not transformational energy, it's not going to be good for you or for your client. You're doing them a service if you ensure that you never get to the point of feeling resentment. Of course it could also lead to burnout for you and your business, which means you're never going to be able to grow your business at the rate that you should, and you won't be able to serve and help all those future people that you'd be able to do if you felt energized and fantastic about your work.
Let's get down to the actual question of pricing. How do I choose a price for my coaching or my program? What is the right number? Like it's a magic number, right? But here's the thing: it's not an exact science, it's more about intuition and even some art. Now, even really experienced major players in our industry aren't able to definitively tell you what you need to charge. I've been on big programs when it's got to the question of pricing, they haven't given me a magic formula because it just doesn't exist. It's unique and really personal how you price. But that said, my first piece of advice is to do some market research, go out there and find people that are offering something similar, something perhaps adjacent to what you do if there's no one that does the exact same thing. Look at the sort of prices that they're charging.
You'll probably be surprised at how much they're charging, but that's a good thing because it's teaching you that there's potential for you to make a lot of money doing what only you can do. Secondly, bear in mind that the value isn't in the time that you spend doing it, it's actually in the transformation that you're offering. A lot of people start thinking, particularly when it comes to coaching that they're charging by the hour. And they need to really understand exactly whether it's a few dollars too much or too little. Now, whilst coaching does sometimes charge by the hour, it's becoming far more trendy to offer a transformation in the form of packages that might last three or six months. If you're worried that the value you're offering it just isn't good enough. Perhaps you're not solving a big enough problem, or perhaps the problem you're solving isn't specific enough.
It seems to be true that people will pay far more to solve a really specific problem because they understand really clearly what the transformation is.
So if you fall into the pattern of your offers being a little general, look to niche it down and try to be as specific as you can.
The third approach is to really make sure that you're considering your pricing as part of your overall revenue goals.
It's really easy to start pricing things in isolation and not thinking about your business goals by the end of the year. Now, you know me, I like to talk about being a CEO for your business as often as possible, and now is a perfect time to remind you that you're running a business. So work out how many clients you're likely to get and how much revenue you'll bring in based on certain prices. It's really easy to build a really simple spreadsheet. Send me a DM if you don't know how. Make sure that you understand how that ladders into your overall revenue goals.
Now there's two broad approaches when you start pricing something, particularly when you're new. The first one is to start at a lower price than perhaps you see in the market and build on it over time. The advantage is here that you can get clients more easily at the beginning. Some people will tell you that you should charge your worth from the very beginning. Now I'm not going to argue with that advice if it works for you. It's fantastic to be able to do that from the beginning but my personal experience and many others of my friends and clients, is that they find pricing a little bit lower than the rest of the market to start with gives them the confidence to fill their programs and their books before they then are able to level up and charge more.
Being able to say that my calendar is now full and I can't take on any more private clients, so now's the time for me to raise my prices is a really positive way of moving forward and growing in your pricing over time. There's absolutely no shame in coming out the gate with a beater price to start with. In fact, there's positive advantages to doing that. When you come up with a beta price, people know that they'll never get it at this price again. They're also going to be way more open to giving you the testimonials and feedback at the end of it. That's what you can ask them for at the very beginning, when you offer them such a preferential price. The second approach, if lowering your prices does not feel right to you is to ask yourself what would make it easier to charge higher prices, if you're not immediately comfortable to do so. If you've got a service you're not willing to reduce the price, but at the same time, you're not feeling that comfortable with actually making the offer, ask yourself, what can you add to the offer to make it worth three times what you're going to be charging?
What are the things that you've got in your basket? The other things that you could add as part of the package, that would mean that the value to your clients is enormous. Even more than the high price that you want to ask.
At the end of the day, you have to use your intuition. You have to feel comfortable, pick a price, put it up a little bit, see how that feels. Put it up a little bit more. Where are you starting to feel Icky? What is the discomfort level? Now pick a place that you feel, Yeah, I'm kind of comfortable here. This is okay. Now up it by 20%. That's the last piece of advice. Get yourself out of your comfort zone and push it up a little. I've done this several times. In my experience, people do book at that rate because your levels of comfort are always below the perception of the value that the market places on your service.
So let's just be clear, remember that when people put skin in the game they're going to get a way more valuable transformation than they'd get if you undervalue your service or give something away for free. Have the confidence to go out with an offer at a price that feels great for you. Always remember entrepreneurship is an iteration process. Just because you go out with a certain price now does not mean that you can't change that.
In the first year, you should be looking to change your prices every quarter minimum until you’re at a place that you are absolutely charging your worth.
You will feel amazing and all your clients will be getting the transformation that they need so much.
To dive into this area more, please do join me on my pop-up workshop in March 2021 called Creating Offers- Make Money Sooner. We're going to be looking at all the different offers that you can make, how to price them. We're going to be workshopping it actually in the live session.
Here's the link: http://bit.ly/3bp4CKN