Profitable Pricing Methods
Dozens of studies have shown that we humans seem to be powerless over psychological factors that affect our behavior towards prices. These deep-seated price persuaders include "anchoring," psychological biases, heuristics (mental shortcuts), and our sense of "fairness."
Yet whether we’re buyer or seller, we have a duty to ourselves and others when it comes to prices presented to us, and prices we set for our products.
As buyers, we have a duty to be responsible with our resources (money) and with that which we buy or invest. The anchoring effect, in which the mention of a number higher or lower than a given price affects how much we're willing to pay, is almost unbeatable.
Yet the antidote to anchoring is simple—consider the opposite. In other words, simply ask yourself if there are any reasons why the price being presented to you might not be right, why the value might be less than the price.
Once we’ve answered that question to our satisfaction (and to others if we’re in a business setting) then we should be OK with our investment in that product or service.
As sellers, we have a duty to provide extraordinary value that surpasses the purchase price. After all, the buyer needs to get a proper return on investment, whether it’s a business or personal product.
As sellers, we also have a duty to make a profit so we can pay everyone, make a decent living, and stay in business.
This suggests that we should develop the skills and courage to set good, preferably premium, prices for our products and services.
Profitable Pricing Methods for Small Business
I mention “courage” because of all the emotions that surround pricing, especially fear.
Fear of losing customers, fear of being undercut by competitors, fear of losing market share, fear of leaving money on the table, and fear of failing.
Fear often prevents owners from setting and getting the best prices. It prevents them from living the kind of life they want and deserve.
Yet just as there’s an antidote to the anchoring effect, there is a way to remove the fears that hinder our own pricing strategies.
There’s a way to eliminate those barriers and have your business start taking care of you, instead of you taking care of your business.
....How would it feel to come in to work everyday and not worry about cash flow?
....To not have to worry about competitor’s prices because your positioning makes their pricing almost irrelevant?
....To know you have money to invest in marketing, sales, or research projects that will grow your business even more?
....To know you can pay your employees above-average wages?
It’s a good feeling.
I know this first-hand because I’ve been at both ends of the pricing spectrum in my career.
In my first job as a print shop salesman, I was told to get down in the dirt with the price cutters. I did, and it came to an ugly end.
Many years later, I finally discovered and enjoyed the benefits of selling an extraordinary product with premium pricing.
What’s the Secret?
The best way to banish fear and emotion from decision-making is to rely on a pricing system.
A good system breaks the question of “what should we charge” into a step-by-step process that gives you a good answer based on everything but fear. And it does this without sacrificing our unique intuition and experience.
A healthy, courageous approach to pricing is critical to success.
In one study of 1200 businesses, consulting firm McKinsey & Co. found that if companies raised their prices by just 1% while demand remained constant, profits would increase 11% on average. This small change to the consumer of a products' price means a huge change for the companies themselves. It means a huge improvement in quality of life for the owners.
The fact is, a good price strategy can get you price increases far beyond 1%. Yet too many owners still struggle with implementing increases as small as 1%.
That’s why I’ve put together this online course, Profitable Pricing Methods—How to Calculate the Best Selling Price for Your Product or Service.
It lays out a step-by-step plan to get you the prices your business deserves, without agonizing over the decision!
What You Get in Profitable Pricing Methods
8 Course Modules (Video)
Introduction – A discussion on pricing and course overview.
Defining Your Customer – Get the right questions to ask about your customers so you can set prices that are affordable and demonstrate the right value to your target market.
Know Your Competitors – How to properly research your competitors and market trends to avoid disastrous pricing mistakes.
Positioning Your Product or Service – How to define your unique value and position in your market.
How to Create a Pricing Strategy – We explore the 5 major pricing strategies, plus how and when to use them alone or together. Included are 7 powerful pricing tactics to use within your pricing strategy.
Monitoring Your Pricing – How to keep track of relevant data that affects your pricing.
Lowering and Raising Prices – When is it time to raise (or lower) your prices? We give you signals to watch and tips on how to change prices without upsetting your customers. And yes, there’s even a true story about the time I was thanked for a significant price increase!
Conclusion – We finalize your pricing action plan.
Screenshot of Profitable Pricing Methods Video and Course Material Page
Action-Step Materials for Download
Course Book – Self-study content and activity instructions – 37 pages
Course Workbook – Worksheets to guide you through the action steps that will get you better prices – 18 pages
Know Your Competitors Worksheet – Spreadsheet for tracking your competitors
Graphics – Helpful graphics to illustrate pricing concepts
Course Summary Checklist – Track your progress as you move through the training
Infographic – 10 Best Practices for Pricing
Infographic – 10 Pricing Mistakes to Avoid
Examples of Well-Known Positioning Statements
Transcripts of all 8 videos – 78 pages
Handouts of slides to use for taking notes – 23 pages
Screenshot of Profitable Pricing Methods Course Book
By the time you complete this short course, you’ll have two valuable assets:
1) A solid understanding of pricing dynamics and how get the best possible price for your products and services.
2) A permanent system in place to monitor your pricing in the face of changing market conditions.
1 Year, 20X Your Money Performance Guarantee
If you know me, you know I’ve always offered guarantees that cause people to question my sanity. As I’ve mentioned in numerous articles, if you can’t offer a great guarantee for your product, you probably shouldn’t be selling it.
So I have an incredible 2-Part Performance Guarantee for you!
1 – 60 day unconditional money-back guarantee.
If any time within 60 days of the date of purchase you feel the course is not right for you, for any reason whatsoever, or no reason at all, just email me. I’ll give you a prompt and courteous 100% refund of your purchase price. There aren’t any weasel clauses buried somewhere in fine print.
2 – 20X Your Money Guarantee
If after using Profitable Pricing Methods for up to one full year, you haven’t earned at least 20 times your investment of $97, I’ll give you a 100% refund of your purchase price. Simply email your workbook, filled in, to show you at least tried the activities we suggested.
If you already have a going business, I suspect you’ll earn 20 times your investment back in a matter of weeks.
If you're just starting out, it can save you from costly pricing mistakes that far too many startups make in the beginning.
Please email me any questions or concerns you have using the Contact Us form.
But don’t delay. As the McKinsey study showed, even the smallest of price changes have a dramatic, positive impact on profits. And why would you want to wait to start making more money in your company?
Strategic pricing was one factor that helped me and my team get another company named to the Inc. 5000 list of fastest growing companies in the USA.
Strategic pricing is what made it possible for me to look forward to work every Monday morning.
If you want to re-energize your business, to get it to start serving you, then you owe it to yourself to check out Profitable Pricing Methods.
It’s absolutely risk-free.
Dedicated to Your Small Business Success
Founder and Editor
the Small Business Rainmaker