Determine Your Pricing Strategy
We are talking about pricing. And I know that some of you are going to say (gasps). But I'm telling you, this is the most exciting part of the entire show. Pricing is my favorite thing to talk about and it is the thing that, when done properly, will make you the most money. So it's super exciting for you too, I hope. So let's dig in. Here's what we're gonna talk about. So we talked about which products to offer, now we're gonna talk about how much to charge for them. And not only that, but how much is your target sale? And what that means, is once the entire sale is said and done, what is that dollar amount that you need for whatever kind of session you're doing. So how many prints do you need to sell or what is that total dollar amount that each session should be worth for your business? And then, how will you motivate your client to invest at that target amount? If you know, I think I said earlier, that I have to make $1,000 for every session or else I go in the hole. That gives me a...
lot of power to walk in that sales room and ask for a $1,000 sale. So, that's what that target sale is right there and then we're gonna talk about how to ask your client for that amount of money with confidence and grace, okay? So let's dig in. How much should you charge for your products? The eternal question. But before we can go there, we have to decide who you are as a business. So we had a question earlier, competing on price versus service. And this is the time to draw another line in the sand. So earlier, you wrote down what your target gross sales goal was. Now we're gonna write another defining thing into your overall plan and that is, do you wanna compete on price or do you wanna compete on service? So, what that looks like ... You can't do both at the same time. So, if you're going to compete on price, you will win when someone calls and says how much is something, okay? You'll say oh, it's only $7, would you like to book a session? And they're like oh wow, that's so much less than the guy down the street, of course I wanna book a session with you. Now, you can win in this business, on price, if you do one thing. And that is, get as many sessions in the door and do them as quickly as humanly possible. You have to be incredibly efficient to be able to compete on price, because basically, what you're trying to do is undersell everybody else. So, think about big discount stores like Wal Mart. They want you to get in, get your stuff, and get out as quickly as possible. There's not really gonna be anybody there to help you make your purchase or anything like that. You go through self-checkout at the end, it's all automated, in, out, get on with your day, right? That's how you win whenever you compete on price. It's possible in this industry, but it's not usually why we like being business owners. It's very impersonal. It's very automated. You might have a button on your website that says book a session now. They can see where your openings are, they click it, they pay, they show up, you've never even talked to them. You do your 15 minute session with them, you do a 15 minute sales session and they're out the door and that's all you ever see them. That's what competing on price looks like. Or, you may wanna compete on service. This is about quality. This is about personal interaction. This is about relationship. This is about serving your client the best way you know how. So when you think about these two models, either one of them work. This is high dollar, high service, quality experience. This is in, out, fast and dirty, okay? So I think, you should be able to write that down, whichever kind of business that you wanna do. But you can't say I'm gonna give you incredible service and I'm only gonna charge you $10 for an 8X10. That doesn't work, you'll go in the hole every single time like that. So, right now, choose which one you wanna do and we're gonna base all of the other decisions on that choice. And then, this is just something to kind of think about as we are walking through the rest of this course, what is unique about you? Why are people coming to your business to purchase your products? What is it? For me, it's an outdoor adventurous experience with bold, dramatic images. Does that fit those styles that I was talking about earlier? Does that capture it in just a couple of words? So you have to be able to articulate that about you and part of what determines it is price versus service. So as you make this decision, that is gonna be part of what's unique about you. You know, if you are doing passport photos, price is probably the determining factor, right? I wanna get in, I wanna get out, and I want it done and in my hand as I walk out the door. If I'm creating decor for the home, probably more service based.