Divorce yourself from thinking about your own, or your competitors’ business for a minute.
If you were looking to hire house cleaners and these were your two options — what would you choose?
- $179 full home cleaning package from Maid Yourself at Home
- $29/hour, two-hour minimum from Maid Express
Obviously, if you’re already trying to talk your husband into why hiring a cleaning service is worthwhile, the price is a consideration. But doesn’t the “full home cleaning package” intrigue you? What do they do that a simple hourly maid doesn’t?
It makes me imagine a checklist to make sure that every corner of your home is shining, a managing maid in a pantsuit inspecting her team of workers and an overall transformation of your home from normal to something new and sparkling.
Can a maid service really do all this? Maybe. But in the early communications, it’s not as important what they do as what they make prospective clients think they do.
Before you even try them you're already doubting the quality of the cheaper option—after all, you want the best for your house and you're willing to spend money to get it! And that’s how you need to view your business (though, of course delivering on your promise is also very important).
Price Your Services for the Customers You Want
The pressure to underbid your way into a gig can be intense, but raising your prices can actually make your services look more appealing to potential clients. When a person is faced with two superficially identical choices, but one is priced significantly different than the other, the customer can’t help but imagine what the difference is.
A skeptic—who is looking to make a purchase based on price alone—will certainly go for the lower-priced option based on the thought process: “why on earth does that option cost more? It can’t be that much better, right?” But don’t worry. They’re not your customers. You want the customer who cares about quality and is willing to pay for it. Customers who are:
- confident in your services before putting their money down
- know what they want
- are happy with the price they’ve decided to pay
These customers naturally have some other traits in common. They’re less likely to:
- question your expertise
- bombard you with questions and changes throughout the project because they aren’t sure what they want
- not pay you
Related Content: What to Say When a Prospect Says Your Freelance Rate is Too High
Low Price Invariably Draws Low-Quality Clients
Online bidding sites, like Elance (now Upwork), are notorious for bidding wars which reduce freelance rates to minimum wage. But users are so busy trying to find work that they aren’t usually thinking about the type of clients they hope to attract. One freelance writer I know regularly gets huge, high-paying work on Elance through a simple strategy. When everyone else is bidding low, she bids two or even three times as much and includes a note saying:
“I know you’re seeing a lot of people offering to do this job for far less than me. Let me give you an early warning. They simply won’t do the work, or it won’t come back at the quality level you need. Once you’ve tried someone else who didn’t work out, get in touch with me and we’ll get your project done.”
Invariably—not every single time, but often enough that she always has too much work—those clients come back in a panic because they’re out of time and the low-priced writer they hired didn’t work out.
This writer says, “Okay, I can still do it, but now it’s a rush job, so it will be twice my original quote.” And clients pay four or six times what they thought they’d pay for a low bidding writer because it’s clear to them that she knows her stuff, will get the work done and will get it done well.
Related Content: 5 Lessons I Learned on My Journey from $5 to $150 per Hour
What Kind of Image Do You Want to Project?
Havi Brooks, an online entrepreneur who runs a sort of self-empowerment course focused on playing and “destuckification,” is the queen of pricing products that have no easy competitive comparison with confidence that makes their value clear to the consumer.
In 2013, she ran just one online class, an 11-month program on emptying and replenishing, priced at $720. For 11 months, that doesn’t sound bad when you break it down, actually. But you see her real value in the premium packages:
- add one in-person weekend training for a total of $1,120
- add an additional week of unlimited access to Brooks’ workshop space in Portland for a total of $1,420
- or, add an additional two days of private coaching with Brooks for a total of $5,000
When you see on her pricing page that two days of private coaching is essentially valued at $3,500, not only does it make her other packages look like a steal, but it conveys a sense of the value of Brooks’ teachings and her time.
Don’t you want clients to feel like a day of your time is worth more than $1,000?
Have you tried raising your rates? What was the outcome? Drop us a note; we'd love to hear from you! If you enjoyed this post — please share it on your favorite social media site.
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Lisa Stein owns FreelanceMom.com, is a college business professor and a mom to two growing daughters. Lisa is dedicated to playing a part in helping women and moms run a business they love, help support themselves and their family and create a flexible lifestyle.