How To Charge More And Make Price Irrelevant [Podcast 210]

GTF 210 | How To Charge More

 

Would you like to charge more for your services, but are unsure how to make price irrelevant?

In business, there are two types of clients you’ll encounter most often.  

One type is the tire kicker- those who seem interested but have a multitude of reasons why they won’t buy.  

The other is a high-value client, those who go beyond price and focus on the value you’re creating.

Between these two, most entrepreneurs would want the high-value client every time, but many struggle with attaining them.

In this episode, not only will you discover how to attract high-value clients, you’ll also get:

  • The 2 Factors to Position Yourself Differently
  • The Hidden Offer Secret and Script I Learned Back in 1989 – and still works today
  • The Difference Between Being a Generalist and Specialist
  • What Trumps Price – and How to Stack it In Your Favor
  • 7 Critical Differentiators to Position Yourself as the ONLY choice in your industry
  • 5 Ways to Add Additional Value for your Clients (that allows you to charge more)
  • The Cost of Working with You VS The Cost of Not Working with You
  • The Bold Offer that led to Media Opportunities, and Opened the Door to a Multi-Million Dollar Publishing Business
  • Why Finding a Need and Filling It Leads to a Dead End – and what to Do Instead
  • The 6 Different Desires to Focus on for your Clients
  • And More…

Have you hit a plateau with your sales and conversions – and could use some help?

Get a steady flow of leads, sales, and profits.  Learn more by scheduling a Breakthrough Clarity Session at http://www.BreakthroughStrategyCall.com.

Listen to the podcast here:

How To Charge More And Make Price Irrelevant [Podcast 210]

Do you struggle with low-level clients, tire kickers, lookie-loos? The type of clients that maybe you would consider high maintenance? How would you like to attract more high-value clients? How would you like to be in a place where you could actually charge more for your services and do it where price became irrelevant for your company? Let me speak to the elephant in the room. The truth is you might be a little skeptical. “Dan, what’s the equation to be able to go out and create pricing?” This question came to me in the coaching program that we offer from one of our students. He says, “How do I come up with a price?” I want to introduce you to a couple of concepts related to how you can charge more to generate more high-paying clients and make price irrelevant in your business.

Dan’s Story

Would that be a value to you? If it would, make sure to give us a thumbs up or like the page or whatever the case might be. We’re going to cover a lot of info in a short period of time. Why is this important? I want to share a little back story. My name is Dan Kuschell. I got started all the way back in direct response marketing in the late 1980s and I started my first company all the way back in 1992. I had some incredible coaches and mentors. I learned something and discovered something from one of those coaches. I didn’t realize how valuable it was because I was in my late teens and early twenties. I didn’t realize how valuable it was probably until the last five years. He talked about how to position your offer so the price would become irrelevant. I got started in the fitness industry. I had a sports background. My dream of playing pro baseball didn’t quite work out. I thought that was going to be my way out of the city. My family was on welfare and so it didn’t quite work. I went to school to be a teacher and I saw a lot of people who are struggling as a teacher. I was like, “What could I do to make more money?” I stumbled into direct response marketing. I saw a way where you can combine teaching and psychology together. I don’t know about you but I get fascinated by the psychology relating to what you can do in business.

I think business is the greatest personal development platform in the world. How about you? Anyway, fast forward, one of the coaches taught us about how to position an offer. Let me give you an example. This is all the way back in 1992. If you own a health club, we would come to you and go, “Joe, we could guarantee you a way that we would bring you a couple of hundred clients in the next 60 days or less. It won’t cost you anything upfront. Our company will front the risk. We’ll run TV ads for you. We’ll run radio ads for you and we’ll create them and we’ll run direct mail for you. We will front the risks and then when and if we make money, we’ll split the profits on the back end.”

Would you be open to that idea? Think about that. Isn’t that an irresistible offer? Here’s lesson number one. What could you do to create an irresistible offer? Make it friction-free where they essentially have to say yes to learn more. Fast forward many years, a couple of businesses later, some success, some failures along the way. I’ve had my fair share. I’ve actually built and grown eleven companies, a handful of seven-figure companies, another handful of eight-figure companies, but I ended up burying three companies in the backyard that I’m not really proud of, but it happened. I’ve got a t-shirt to go with it that’s a little bit soiled and been there, done that. If you’re struggling to attract high-paying clients or your right-fit clients, you’re going to love what we’re going to cover and there’s a lot to it.

GTF 210 | How To Charge More
At times, even when you don’t know if you can make it happen, be bold.

 

We’re going to narrow this down to a couple of critical things. We’re going to cover two critical factors for you to be thinking about as you look to charge more. I’m going to give you seven key ingredients that will position you differently in the market place and eliminate your competition and a whole lot more. With that in mind, the big breakthrough for one of my businesses came. Fast forward, I started working in the consulting industry helping clients make more money. I don’t know if you’ve ever put together programs or products. I published my first book all the way. I think now we’re up to five or six books, but I published my first book in 2000 or 2001. I ordered all these books and I had a garage full of books, if you can picture them stacked all the way to the ceiling, these boxes.

I was like, “What am I going to do?” I didn’t want to get on the road and do book tours and roadshows and all that type of stuff. It didn’t interest me. I was like, “What can I do?” I ended up on radio and I interviewed the host of this particular radio show on NBC in Phoenix. He was a sharp dude. Have you ever met somebody who you connect to them and you can just feel a sense of their desire and their passion? I interviewed him, he interviewed me, we went on the show and I took a chance. This is another lesson. At times, even when you don’t know if you can make it happen, be bold. Verne Harnish of Gazelles and Growth Institute says, “You’ve got to have a big hairy audacious goal.”

I had a big hairy, audacious, bold statement that I made. I went live on the air. Imagine this, you go live on the air on NBC radio in a major market like Phoenix. You get on with this host in an early morning program, drive time in the early morning where there are lots of people listening. I challenged the host. His name was John. I said, “John, if I could guarantee you a way that I’d help you increase your income by over six figures in the next twelve months or less, would you take me up and allow me to coach you?” He had a choice to make and John and I have become good friends now because he said yes. He said, “I said yes because I had no risk. I figured if it didn’t work and I expected it wasn’t going to work, that I would shred you on the radio and trap your reputation.” Here’s the truth when we speak to another elephant. I didn’t hit the goal of helping John increase his income by over $100,000 in twelve months. I helped him do it in four months and three days. He became an amazing success story and we carried that forward.

Business is the greatest personal development platform in the world. – Dan Kuschell Click To Tweet

We moved a lot of books and we were giving books away for free on the radio all the way back then in 2001, 2002, 2003. I didn’t invent that model either even though I know there are some people now who are promoting that they invented it in the last few years. The reality is there’s a guy named John Share, I don’t know if you followed direct response marketing, but he used to go on TV and he gives away this free software. You just paid the shipping and handling and that’s where I modeled the free book offer from. It led to a multimillion-dollar business. Fast forward, I built a handful of companies that combined in revenue of over $100 million. We had over 150, 170, almost 200 employees, a few different offices and it was amazing in so many ways. I learned a lot of incredible lessons about how to position yourself to make price irrelevant and charge more. I want to walk you through a couple of critical steps to be able to do it. I want to share two critical focuses.

Generalist Versus Specialist

Who makes more money in business now, the generalist or the specialist? It’s a loaded question. You probably know the answer. Two critical factors that you want to be thinking of, generalist or specialist? Specialists make more money. Professional athletes are specialists in a given field. Let’s talk about baseball. There are different ranks, but a specialist in baseball playing in the Major League makes 100 times more than a guy playing professional baseball in A-Ball or Rookie Ball, maybe even 1,000 times or 100,000 times more in many cases. There’s a big differentiation. That’s what we want to focus on. What is going to make you unique? Sally Hogshead says it well and I’m going to paraphrase so it might be a little off, but here’s the concept, “It’s better to be different than better.”

Everybody in your field, aren’t they trying to be better and go around and say, “We’re better than everybody else?” Instead of going around and beating your chest and saying your better, what if you could say your unique? I want to introduce you to seven ways that you can introduce yourself and be unique but before I do, why is price factor so critically important? Have you ever heard that money and time, in fact, are never an issue? They’re just the measurement of value. If you’re not in a place where you’re able to attract higher-level clients, if you’re not in a place where you’re charging premium type prices, could it be that perhaps you aren’t showing the value?

Seven Critical Ingredients To Boost Value

I want to show you this chart quickly that I drew up really fast. It’s the price versus value chart. It comes down to your offer. The first thing is if you want to boost value, there are seven critical ingredients to be thinking of. Most people think of the first one historically quite a bit. I’m going to run through these and I’m going to put up a screenshot so that you can see it. The first one is what most businesses lean on, especially in business development or business growth or personal development type thing, they focus on the ROI. You know what ROI means, return on investment. Most people talk about what they do in the return on investment. There are six other critical factors that make a difference. You might want to write these couple of ideas down that I’m going to share with you.

GTF 210 | How To Charge More
If you can do things better than anybody else in the market, then that’s a differentiator.

 

The next six are ROS, ROR, ROC, speed, decreasing risk liability and quality. The first is the ROI. You’ve got your ROI or return on investment. What is ROS? It’s the return on savings. You either want to help people see how they can boost their revenue or profitability or so on or increase return on savings. How much money are you saving them by working with you? When you can combine the two, it becomes an exponential factor. I’m going to give you a couple of examples here to show you. ROR, this is one of the most critically undervalued key pieces that can make you completely unique in the marketplace. It’s the return on relationship with you. Your reputation, your standing in a community, your relationship means something, but do you put a value on it? If not, how could you put value?

What would have to happen for you to package up the value of the relationship with you and your business and your company? What that would mean to them? We’ll get more into a couple of examples here. Another one is ROC. This is the return on your connections. If you have a network of people that you’ve built up then you can introduce others to. That return on the connections, the accessibility, the value that you can bring to them by helping them make money, save money, have a valuable relationship with you as you’re eliminating pain and increasing the pleasure. That’s critically important, the return on connection with you. Next is the speed of implementation. If something takes twelve months, 24 months and you’re able to collapse it down into 30 days or 30 minutes or 30 seconds, people will pay for speed.

How can you package what you do to be built on efficiency, effectiveness and increasing speed as a result of working with you? Decreasing risk or liability. One of the clients we work with has a premium mastermind program in the marketplace and we went in and for a big annual event that they host it’s $10,000 a year. We helped them implement something they never had before. We put it in place and it was a little scary for them up front, but they did it. We guarantee if you attend one day of our event, if you don’t feel you got at least $250,000 in value by the end of the first day, come and see our staff. We’ll refund your full tuition plus X dollars in verifiable travel expenses for making the risks. To my knowledge and the time that they’ve offered that, they’ve never had one person come back to them and take them up on the guarantee that I’m aware of.

You've got to have a big hairy audacious goal. - Verne Harnish of Gazelles Click To Tweet

They’ve done tens of millions of dollars in business since that time. How can you reduce risk and liability? One of our clients that we’re working with are offering $1 million guarantee if you attend the first day of their event because they have so many things they do before you even show up. Next is quality. How do you differentiate based on the quality, the standard, the high value that you give them? I’m going to give you a couple of examples. I just had to put context to this. What could you do to differentiate yourself with either the ROI or the ROS or the ROR? The ROR, the ROC, increasing speed, decreasing risk in liability and increasing quality. What would happen for you if you could nail down one, two or three of those that completely transform your niche in your industry? It would be a game changer. I want to walk you through a couple of key pieces that I think will make a difference for you as well.

Perfect Client: The Opportunity Filter Criteria

Have you ever said to yourself, “How do I attract my perfect client?” This is a distinction from what Dan Sullivan calls the opportunity filter. With the opportunity filter, what happens is typically you’re going to rate relationships. What if you started transitioning to look at your clients through their eyes, through these five criteria? What are the five criteria that can bring you a perfect client? This again comes from Dan Sullivan’s The Strategic Coach, which is amazing. When you work with a client, do you enhance them? If so, how do you enhance them? That’s a differentiator. If you work with a client, how do you appreciate their value? How do you show gratitude? If you can do that better than anybody else in the market, that’s a differentiator. How do you utilize your clients? If you work with your clients and utilize them in ways that nobody else in your niche does, that’s a differentiator.

Enhance, appreciate, utilize and refer. If you’re able to refer others to your potential clients in a unique and different way than any of your competition, wouldn’t that give you an unfair advantage? Isn’t that what you’re looking for? Then the fifth one is the financial multiplier. If you’re working with your client and you used the previous seven distinctions and ROI or ROS or any of the other ones, and you help them see a financial multiplier, wouldn’t that give them greater confidence, greater certainty, greater value? Now we have the seven distinctions plus we’ve got the five opportunity filter criteria.

Those are twelve ways you can differentiate yourself in the marketplace. I’m going to give you a couple of examples. We’ve got a very special bonus that we’re going to share with you. How do you make price irrelevant? When you stack it this way, these twelve criteria that I’ve just gone through, what ends up happening is you start to shift and create a bridge in people’s mind related to price and value. There starts to be a shift and what happens is these three criteria kick in. It’s the COI, it’s the COR and the COC. What does that stand for? How you shift where value is greater than price becomes a cost of inaction with your potential clients.

GTF 210 | How To Charge More
If you want to charge more, simply position yourself to be unique and different.

 

There’s a cost of them not working with you. There’s a cost on the relationship if they’re not in business with you and there’s a cost of connection to you and your colleague intellectual property and all the other assets that we’ve talked about. There ends up being a cost of not doing business with you, which is a huge factor to be thinking of as you start to build and grow your business. It’s essentially a scale that breaks down. It’s the cost of not doing business with you. The value is so much greater than the price ever would be. One of the clients that we’re working with do some amazing high-level stuff and we encourage them to go out to their marketplace. The offer for them to be able to make is first I have to demonstrate how they’re going to work with clients. In their case, they can show when we work with a client based on the marketing we do, the sales pieces we do, the hiring we do and the full business model make-over. With the right kind of client that fits their criteria, they can add over $10 million to $20 million in potential revenue growth with high profits.

They paint this picture and then they go like, “If we were able to help you do this, what would you be willing to pay for that?” They have clients who say $2 million, $3 million, $1 million. When they break down their fees, if someone says easily that if you help me grow by $10 million, that would easily be worth $1 million in revenue or $1 million for us that we’d be willing to pay. If someone comes in and says, “We’re $25,000 a month plus a performance bonus based on pure results that we get,” doesn’t that seem like money in the discount? It seems like it. What could you do to package up your money? I’ve got a couple of other examples I want to share with you.

If you’re learning some good stuff then I encourage you to post, hit thumbs up, hit like, hit a heart, share the love, if you will. If you feel that this could benefit someone else, I also want to encourage you to share this with somebody. Essentially the cost of not doing business with you becomes greater than the price. The value is far greater. You’re stacking all of these different things in your favor and when you have that in your favor, it’s amazing what can happen. Another thing to be able to think about and when you’re talking to a client if you create the stacking the right way is you ask them, “How would it impact you?” There are two sides to that coin. How would it impact you if we work together based on everything we’ve shared and/or how would it impact you if we don’t?

It's better to be different than better. - Sally Hogshead Click To Tweet

You’ll have some people go, “I’m working with somebody.” You have competition. Then ask them, “How’s that working for you? Is it working? If it’s not working, it is now the time to be able to make a shift and make a transformation to get your next big breakthrough. Is that what you want or do you want to keep doing what you’ve been to and keep getting the same result? Are you more interested in being active in spinning an ongoing wheel or are you interested in getting great results?” You can give people options. “How would that impact you?” becomes a very valuable question. This isn’t your fault and it’s not my fault. Part of the problem is there have been a lot of trainers out there, a lot of experts who led people like you and I stray.

We’ve been lied to. We’ve been cheated by a lot of experts and gurus and stuff like that. You’ve probably heard this one, “Find a need and do what? You know the rest of that, don’t you?” Find the need and fill it. Have you ever heard of that? It’s the biggest mistruth in the marketplace that will send you down an empty road. It will send you down an empty bowl if you’re hungry. It’s empty. It’s not finding a need and filling it. It’s finding a want and filling it. If you have a stop smoking program, there are a lot of people who need to stop smoking. They don’t want to though, but if you’re going around trying to convince people who don’t want to quit smoking to quit smoking, that’s going to be a long painful road.

Finding A Want

Maybe you know some people who have been there in those types of industries. Rather it’s a lot easier to find someone who wants to make the change, who wants to get the transformation and who wants to get the result. It’s not finding a need and fill it, it’s finding a want and fill it. There are a few key factors as it relates to finding a want. Ideally, this graph will show you and give you a couple of jumping off points. What do they want? What are their greatest desires? How does it impact? What’s the greatest want they have for their status upgrade or to be included? What do they want to eliminate as far as fear, reduce the fear? What do they want in filling an aspiration? What do they want to be filled as far as the insecurities? What’s the frustration they want to build?

GTF 210 | How To Charge More
Stack the value scale in your favor so the price is no longer an objective.

 

If you look at the outside edge of that piece of the pie, at the end of the day, you’re helping them solve a problem. What problem do you solve uniquely different than anybody else? Especially if you use the previous twelve criteria, there is no limit to what you can achieve. Here’s an example. One of the clients that we work with is in the stem cell industry. When we started working with him, he was frustrated. He had a lot of clients and good business. If you ever heard that saying from Jim Collins, he says, “Good is the enemy of great.” Mediocrity is the enemy of greatness too in being a winner and being a champion.

This doctor, this client of ours, he had about 40 clients. About twenty of them were paying him $500 a month for this done-for-you service. They offer a great program and service. Then another twenty in a little higher-tier program that we’re paying them $1,000 a month. If you look at that, a total of 40 people, 40 clients that he’s servicing every single month and his business is doing about $30,000 a month, twelve months a year. If you project that out, it probably doesn’t work exactly that way. There’s probably some fall off. There are probably some new people coming in. Let’s use it for simple theoretical example, $30,000 a month is about $360,000 a year division of this particular company. When I met him, he was frustrated like, “I’m tired of working with the lower level type of clients. They’re needy and they have all these unfair expectations. What would I have to do to be able to position myself to charge more for what we do?” It’s the topic of this conversation.

We went through and we have an entire process that we work with clients on over a course of time. We spent a day together and we started through that process and completely transformed their offer, their messaging, how they communicate that messaging and a whole lot more. As we came out of that, we actually shifted his pricing model to instead of $500 and $1,000 a month, $5,000 a month premium service and then another one that is $100,000 a year program. He got started and there were some bumps along the way. The long and the short of it is he made the offer and let his old clients know that he was going to offer this $5,000 a month package.

Do you think some of those clients left? Yes. Some of them left and he handed them off to some other partners that could help support them in a cool way. They weren’t left stranded with no help and no assistance and no support and all that sort of thing. He decided in his heart of hearts they weren’t a right fit for him anymore. He lost a handful of clients and gain a few that he was making this new offer to. Long and the short of it, he ended up with fifteen clients a month. You might go, “If I increase my price, I’m going to lose clients.” He went from 40 to 14, it’s that loss there on the number of clients.

The biggest mistruth that will send you down an empty road is finding a need and filling it when you should be finding a want instead. – Dan Kuschell Click To Tweet

Let’s look at the map because this becomes a math equation. He went from $30,000 a month in this example to fifteen clients at $5,000 a month. What did that do for him? That became a $75,000 a month model that’s over 2x plus in revenue. When you’re working with a lesser amount of clients who are higher quality, can you serve them better? Can you provide additional value? Can you provide additional tools, resources, and guidance that maybe you couldn’t with a lower level type of client where it’s a lot of clients? You can have quantity and that’s a model. You can have quality. You can have a hybrid of both, but in this simple example, it transformed the look and feel of his entire business. Would you rather have option A with a lot of clients that are lower level or would you like to charge more and differentiate yourself in the marketplace? All of that being said, if you want to charge more, it’s simple. You’ve got to position yourself to be unique and different.

Our overview now, we’ve covered seven different differentiator strategies. We talked about the difference between being a specialist and a generalist and a whole lot more. We’ve given you twelve different ways to stack the value. Use any one of them, they’re lethal. Combine a few of them and it’s exponential what you can do to stack the value scale in your favor so the price is no longer an objective. At the end of the day, what if you could position an offer where you can go to somebody and say, “If I could do X to help you avoid Y, would you want to know more about it?” Make it simple on yourself. Create a friction-free and risk-free proposition. Use the tools that are here.

I hope you’ve enjoyed this episode. Give us your thumbs up if you feel like this could help someone. If you know somebody who’s struggling with pricing or how to think about pricing and all those sorts of things, share this with them. If you have a question, hit us up. If you want to go deep with some of our resources and you want to schedule a conversation to see how we might be able to help you, we’ve made it really easy. You can do that by going to this link on the page, that’s BreakthroughStrategyCall.com. You’ll be taken to a page which says, “Request your invitation.” You enter your name and your email address, then it will take you to another page where you just give us a little bit of info about your business, what you’re up to, how we can help you potentially. Then that will take you to a scheduler so that we can schedule a conversation and see if we’re a fit.

If we are a fit, we’ll talk to you about some of the different resources we have available. If we’re not the right fit for each other, we’ll refer you to other resources that could be helpful. If you liked this segment, hit like on the page or somewhere around here. Share it with someone you care about. If you want to go deeper, BreakthroughStrategyCall.com. We’re going to be putting out more insights. If you have a question, what’s one question that if answered, could make a difference for your business to be on a path to be able to get your next big breakthrough? You are one breakthrough away from getting to that next level of clarity, certainty, confidence, to be able to go out and generate more leads, more sales, more profits, more importantly, so you can have a bigger impact, a bigger reach and make a bigger contribution. If that’s what you want, then apply what we’ve been sharing with you. Stay tuned for some of our upcoming segments coming around the corner. I look forward to working with you and helping you reach your goals. Be great.

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