There are two things you have to identify in pricing - the value of the benefit you bring to the purchaser and the rock bottom price that you are willing to sell it for.
Somewhere in between is your price for profit.
Understand what it is worth to your customer I can have an idea in one minute that will become a branding slogan for an entire business.
Do I charge for the minute or for the profit and prestige it will bring over time? A golf professional client of mine was asked to give a clinic for the customers of a client.
What is the benefit to that business owner? How do you measure increased good will, deeper trust and better relationships? Those are invaluable in the world of business.
Put a perceived price on it.
A web designer can put up a blog in a few hours.
What is the perceived value to the person who has no idea how to do this? That blog will last for years.
It's not the time you spend it's the results you produce.
The first step to identify your pricing is to write down a monetary value of the benefits of what you offer.
You are not going to ask that much but keep that number in mind as you create your pricing.
Identify your own self-worth I'm not willing to work for less than a certain amount per hour.
To go lower would make me feel devalued.
Your bottom line will include value for your preparation time, your presentation time and the value of the expertise you have gathered over time.
Balance that with what you need to earn for your own sense of personal value.
Put a price on that.
A more subtle value to consider is the impact of what you will gain from the exchange.
My golf pro client will probably attract new clients from the people he has at his clinic.
He can take that into consideration in his pricing.
Our group of Book Yourself Solid coaches participated in a week of interviews that we all did for free with the express purpose of attracting new people to us.
Add the value of those potential business growth opportunities to your pricing mix.
Be certain you never, never, never undervalue yourself.
When you price yourself too low it will not attract the people you want to serve and you will not feel good about your work.
Value yourself and price yourself accordingly.
Make time to over-deliver How much in person time does this offer require? How much prep time? How does this fit into your current schedule? I am planning a new telecourse and I am writing a series of ebooks and I am coaching and I'm behind in my blog posting.
What is reasonable for me to offer? What can I actually add to my schedule and make happen? What is the best use of my time? What will produce the most income in the long run? You don't want to live your life under pressure.
And you always want to have enough time to over-deliver.
Put together some deals A good example of potential price ranges is a teleclass offering.
Let's say I price a teleclass at $375 but my bottom line, the lowest price I will take in order to feel valued, is $275.
There is a $100 in there with which to create some offers.
You could have an Early Bird Special.
You could have people bring a friend and get a percentage off both sign ups.
You can give a special price to the first 10 people who sign up.
Play with the difference between your bottom line and a price that indicates a valuable offer and make some deals.
You can also offer bonuses.
Actually one of the best bonuses I give in my teleclasses is a free 20 minute coaching session to a certain number of the participants.
I make new friends, I get feedback on what I taught through their questions, and they often end up as clients.
What 1:1 interaction can you offer in order to take a relationship a step deeper? Create intriguing packages Reward a buyer for numbers.
I bundle my Landing Page Magic Book with every one of the books in my How to Craft Series because it contains the core step of my Magnetic Content Development System.
You can buy each book of the series alone but I also offer it at a discounted price when they buy Landing Page Magic.
In the case of my golf pro he could offer a lower package price when the business owner commits to a specific number of clinics.
The more the business owner commits, the lower the individual price for each event.
My favorite way to figure out pricing is to make a chart of four columns.
On the left column place all the things you can offer.
List the MP3, the ebooks, the worksheets, the 1:1 coaching, every possible deal and combination you can think of.
Label the next three columns Level One, Level Two and Level Three.
Put an "x" by what each level offers and you will visually show the customer how the packages differ.
It's a good method and for posting them on your web site for clarity and the process helps you figure out your best offers Give your clients what they want Do they want a quick result? Do they want to learn in depth about the topic? Do they want accountability? Do they want coaching or a home-study course? You can leverage an idea into any size package.
How much time do they have each week to spend on this information? What deadline do they have in order to achieve a specific result? What is their motive for doing the work? I can emphasis the fact that creating information products creates passive income and that will draw a people with that desire.
But who I really want to attract are people who want to educate, motivate and inspire their target community by crafting information products about what they already know.
Those are two different feelings and will draw people with different motivations.
Who do you want to attract and why do you want them to come to you? Understand how your product will be best consumed How you present your package depends on the consumption habits of your target community.
Young people are electronically oriented.
Seniors can barely get on line.
You have to know where your target community goes to get their information.
For instance, I'm not a video consumer.
I want to scan and read and copy parts of what I read.
Because I teach so much I want to put it in a folder so I can easily find it again for future reference.
I can tell in seconds if I want to read in depth.
A video makes me commit to an unspecified amount of time and I don't know whether it is a good use of my time or not because I don't know the content.
I like to see what I'm getting.
But video is big and getting bigger.
The age of your target community will help dictate how you present your material.
You are looking for a combination of what you like to do and do well and how your target community likes to consume their information.
Pick a price for profit You really need to answer only two questions.
What is the monetary value of the benefit your client will receive from what you offer and what is your personal self-worth bottom line.
Someplace in between is your price for profit.
© 2011 Cara Lumen
Somewhere in between is your price for profit.
Understand what it is worth to your customer I can have an idea in one minute that will become a branding slogan for an entire business.
Do I charge for the minute or for the profit and prestige it will bring over time? A golf professional client of mine was asked to give a clinic for the customers of a client.
What is the benefit to that business owner? How do you measure increased good will, deeper trust and better relationships? Those are invaluable in the world of business.
Put a perceived price on it.
A web designer can put up a blog in a few hours.
What is the perceived value to the person who has no idea how to do this? That blog will last for years.
It's not the time you spend it's the results you produce.
The first step to identify your pricing is to write down a monetary value of the benefits of what you offer.
You are not going to ask that much but keep that number in mind as you create your pricing.
Identify your own self-worth I'm not willing to work for less than a certain amount per hour.
To go lower would make me feel devalued.
Your bottom line will include value for your preparation time, your presentation time and the value of the expertise you have gathered over time.
Balance that with what you need to earn for your own sense of personal value.
Put a price on that.
A more subtle value to consider is the impact of what you will gain from the exchange.
My golf pro client will probably attract new clients from the people he has at his clinic.
He can take that into consideration in his pricing.
Our group of Book Yourself Solid coaches participated in a week of interviews that we all did for free with the express purpose of attracting new people to us.
Add the value of those potential business growth opportunities to your pricing mix.
Be certain you never, never, never undervalue yourself.
When you price yourself too low it will not attract the people you want to serve and you will not feel good about your work.
Value yourself and price yourself accordingly.
Make time to over-deliver How much in person time does this offer require? How much prep time? How does this fit into your current schedule? I am planning a new telecourse and I am writing a series of ebooks and I am coaching and I'm behind in my blog posting.
What is reasonable for me to offer? What can I actually add to my schedule and make happen? What is the best use of my time? What will produce the most income in the long run? You don't want to live your life under pressure.
And you always want to have enough time to over-deliver.
Put together some deals A good example of potential price ranges is a teleclass offering.
Let's say I price a teleclass at $375 but my bottom line, the lowest price I will take in order to feel valued, is $275.
There is a $100 in there with which to create some offers.
You could have an Early Bird Special.
You could have people bring a friend and get a percentage off both sign ups.
You can give a special price to the first 10 people who sign up.
Play with the difference between your bottom line and a price that indicates a valuable offer and make some deals.
You can also offer bonuses.
Actually one of the best bonuses I give in my teleclasses is a free 20 minute coaching session to a certain number of the participants.
I make new friends, I get feedback on what I taught through their questions, and they often end up as clients.
What 1:1 interaction can you offer in order to take a relationship a step deeper? Create intriguing packages Reward a buyer for numbers.
I bundle my Landing Page Magic Book with every one of the books in my How to Craft Series because it contains the core step of my Magnetic Content Development System.
You can buy each book of the series alone but I also offer it at a discounted price when they buy Landing Page Magic.
In the case of my golf pro he could offer a lower package price when the business owner commits to a specific number of clinics.
The more the business owner commits, the lower the individual price for each event.
My favorite way to figure out pricing is to make a chart of four columns.
On the left column place all the things you can offer.
List the MP3, the ebooks, the worksheets, the 1:1 coaching, every possible deal and combination you can think of.
Label the next three columns Level One, Level Two and Level Three.
Put an "x" by what each level offers and you will visually show the customer how the packages differ.
It's a good method and for posting them on your web site for clarity and the process helps you figure out your best offers Give your clients what they want Do they want a quick result? Do they want to learn in depth about the topic? Do they want accountability? Do they want coaching or a home-study course? You can leverage an idea into any size package.
How much time do they have each week to spend on this information? What deadline do they have in order to achieve a specific result? What is their motive for doing the work? I can emphasis the fact that creating information products creates passive income and that will draw a people with that desire.
But who I really want to attract are people who want to educate, motivate and inspire their target community by crafting information products about what they already know.
Those are two different feelings and will draw people with different motivations.
Who do you want to attract and why do you want them to come to you? Understand how your product will be best consumed How you present your package depends on the consumption habits of your target community.
Young people are electronically oriented.
Seniors can barely get on line.
You have to know where your target community goes to get their information.
For instance, I'm not a video consumer.
I want to scan and read and copy parts of what I read.
Because I teach so much I want to put it in a folder so I can easily find it again for future reference.
I can tell in seconds if I want to read in depth.
A video makes me commit to an unspecified amount of time and I don't know whether it is a good use of my time or not because I don't know the content.
I like to see what I'm getting.
But video is big and getting bigger.
The age of your target community will help dictate how you present your material.
You are looking for a combination of what you like to do and do well and how your target community likes to consume their information.
Pick a price for profit You really need to answer only two questions.
What is the monetary value of the benefit your client will receive from what you offer and what is your personal self-worth bottom line.
Someplace in between is your price for profit.
© 2011 Cara Lumen