How To Be Fearless in Your Pricing
Pricing reflects value, and undercharging for your services can lead to doubt about quality. Lawrence Chan's insights show that when you discount your work, clients may question if they are receiving the same level of service. Just like paying more for a reliable roofer gives peace of mind, charging what you're worth sets expectations and builds trust. Remember, low-ball competitors aren’t your true competition—your worth is defined by the value you bring, not by someone else's price.
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When it comes to pricing, most of us believe that we should be charging more for the work that we do. Why don't we ask for it? Is it because we don't truly think that we are worth that price or are we afraid to shock someone? Lawrence Chan is author of this marketing blog www.tofurious.com for smart photographers. While Lawrence is referring to wedding photography in this particular article I believe that this information fits any business. We all need to figure out what we are worth and charge accordingly.
Everything in life as we know it is relative. We, as humans, must compare in order to understand value.
- How do you know that a steak tastes good until you’ve had another cut that tasted terrible?
- How do you know that someone is beautiful until you’ve seen someone less appealing?
- How do you know that your services are cheap or expensive until compared to another vendor?
What do all of these numbers represent?
Indicative Value
Prices are, to a certain extent, representations of quality. We live in a world of value.
In the following situation, the amount paid for something represents the degree of love or appreciation one feels.
(image courtesy of http://www.papyrusonline.com/)
Whenever you get a birthday or thank you card, what is the normal process for appreciation?
- Look at the calligraphy on the envelope
- Take the card out of the envelope
- Appreciate the card cover’s graphics
- Open the card to read the messageOne last step…
- Turn the card over to see the brand and price paid (or do some of us do this step first?)
Why are we programmed to see how much our friend paid for the card? It’s just a card. The kind thought and message should be the key factors to weigh its worth. It’s almost unavoidable.
PRICES SET EXPECTATIONS
The amount paid for a card is indicative of the value placed on the recipient…most of the time.
Mental Shortcuts
A home’s shingle roof should be replaced approximately every 10 years. When mine was due for a change, I contacted two roofers for an inspection.
(image courtesy of http://www.kbhome.com/)
The two of them did almost the same things. They climbed onto the roof, poked around and did some estimates based on square footage.
- Roofer 1 – quoted me $8,000 with an 8 year warranty. He estimated 3 hours of labor with a dozen men.
- Roofer 2 – quoted me $4,500 with an 8 year warranty. He estimated 3 hours of labor with a dozen men.
I was about to get a third quote, but decided that I was too busy. I thought it over for about a day and this is what I concluded.
Why was Roofer 2 about half the price and guaranteeing the same thing? I wondered if he’s cutting corners to try to save some money.
A roof is something I don’t want to have to fix again in the next decade, so there shouldn’t be any problem with this replacement. It’s settled.
I’m going with Roofer 1.
This was a true story. And this was the same issue I encountered when starting out in the wedding industry.
The moment I discounted, the bride literally asked me, “I know that you’re being generous and I appreciate that very much. I’m ashamed to ask, but are you offering the exact same service as you would with every other client?” If they didn’t ask it, they definitely thought it. You can tell when they want extra things from you – edit this, do that, I want these images swapped out, etc. There is less trust.
This was just like how I would have had minimal trust if I paid a roofer half the price of what I assumed was market rate.
i’m not an expert in roofing, just as how…
A BRIDE IS NOT AN EXPERT IN WEDDINGS
Until today, year 6, there are no leaks. Does it prove a point? No. It just proved that by paying more, I get peace of mind.
Low Balling Does Not Work [most of the time]
Be honest. Would you eat sushi or sashimi that costs $0.25 a piece?
Personally, I wouldn’t. That just sounds “fishy.” But, some would.
Therefore, stop worrying about those who charge a fraction of your rates. They shouldn’t even be considered competitors. The moment you treat them as one, you lose.
Let’s put this into context. A wedding is a once in a lifetime experience. Would most people risk that special day?