When I ran a survey, I asked people, “Do you feel like you’re getting paid less than you’re worth?”
100% of people said “YES!”
I then asked those same people to explain why, and they said:
“People won’t pay my prices, so I lower them.”
“My competitors charge less than I do, so I lowered my prices to match.”
“I don’t believe I could charge more for what I do.”
Sound familiar?
It turns out that most people who struggle with getting paid what they’re worth have these same problems.
And that’s why I filmed this short video…
The Secret to Earning More Money For Your Work
(Unfortunate freeze frame, alert: “Look, I can make the same shape with my fingers as I can make with my mouth.” )
When you’re done with the video, share your biggest AHA! moment and how it relates to your business in the comments.
(Lately I’ve been obsessing about meeting each and every Social Triggers subscriber. So, even if you haven’t left a comment before, today is the day!)
One more thing…
Do you have a friend that complains about getting paid less than what they’re worth? Do them (and me) a favor by sending them a link to this video. Thanks!
I have read this post and it is very informative. Great video and the topic are also amazing. Thanks for sharing this post.
Point #2 is something Im aware of for sure however, after I started educating people in my niche ( explainer videos and video animation ) clients started to appreciate the value of what I do and were more than happy to pay for it.
Thanks …… I love your video “The Secret to Earning More Money For Your Work” It helps in business
Hi Derek!
I have been watching a few of your videos and all been helpful. I think that I am right into a very vicious circle and it seems like I am not able to get out of it. (More then a year now) My problem is not only that I am not getting paid what I am worth but that I do not know what to decide about my pricing and every time I feel like I have decided of something it gets broken down very fast. My field is photography and there are so many options and possibilities regarding pricing, and massive competition, that it just freezers me. Argh! can’t move! And since I am not set on my pricing I am scared of advertising and know I shouldn’t as I wouldn’t know or ever feel happy about what I tell them! Your video was very helpful but if you ever feel like doing more specific to pricing for photographers out there Ahhh goo forr it pleassee!! All the best to you! Marie
LOL!!! “The more likes I get, the better.” Awesome..best. line. ever! Keeping it real and keeping it simple. Brilliant! I’m guaranteed a giggle AND some knowledge on your channel Derek. Love it. It’s so refreshing. You know, I used to have this problem. Not anymore. Now I charge what I am worth and my students and clients are still getting a great deal, because I give so much to them – (add value) and because I genuinely love them and I love my work. It’s got to be a fair exchange of energy. I think it’s about having a healthy dose (not in the narcissistic sense) of self love, self respect and the most important? Courage. I did at some point have to take a deep breath and up my fees, uncertain of the outcome.
But too true – I agree, stuff the cheap-skates who can’t see your value and appreciate your unique offering. Or (more likely, if you live in an area as affluent as mine) simply want ‘something for nothing/not much’.
IMHO being brave enough to opt for quality over quantity leads to quality AND quantity. As long as you really are genuinely good at what you do – I say, stay true to yourself. Charge what you are worth. Charge what you deserve. I ‘walk my talk’ in my work anyway as I encourage my clients and students to do the same. It would be bogus if I didn’t. So learn about the competition, then forget about them. I know it’s obvious but – you’re not them and they are not you. Trust in that thing that makes you special, then watch the high calibre clients roll in. And make use of the beautiful testimonials you get later, affirming what you trusted yourself to know.
I fell into a freelancing role doing social media strategy and implementation for clients for an agency. The director approached me and said we charge this client xx per hour and I want you to come to me with a rate you think is fair to charge us out per hour when you do client work (this will be way above my per hour rate at the moment). Are there some sort of guidelines to follow for charging an agency as a freelancer? Should it be 50%? I don’t want to charge her too little or too much, but I also want to be fair.
Feels like I am getting Aha-moments quite often right now – learning new stuff about blogging. The biggest aha doesn’t pop up right now but your tip with “so that…” was interesting (into my notebook it goes). It gave me a flashback reminding me of a video I saw quite long time ago about the power of using the word ‘because’.
I hadn’t thought about the idea that I might be attracting the wrong audience. I find myself in an unpleasant situation because I want to encourage people to live more frugally and “back to basics” as a means of preparing for and coping with hard times. Yet I want them to buy stuff my affiliates and advertisers offer.
Valuable tips, thank you Derek!
The “so that” – formula is something I need to focus on, so that it’s easier for my customers to see the ‘real’ value of my services.
Awesome Derek! Awesome..
And I did set an unwanted kind of CLIENTs. Just really weird, this morning I woke up and thinking about what I do (website building) and clients I have currently managed. And I am on my text copy right now. Changing everything on my site.
Thank you so much for the ‘reminder’
#1 – done – I never give discounts – my work is full price or donated to charity. I advertise by donating to auctions at big gala events.
#2 – They’re sold once they sample my work, and I send samples to most people who inquire. I post all my work to Facebook and they love the photos. Most new clients come by word of mouth.
#3 – I just had first price increase in 5 years – hard to tell difference yet.
Need to get newsletter out describing “differences”
Thanks!
Life is tough. We have two choices. We can stay where we
are and attract those below us who as you mentioned “want a
discount” or we stand tall and firm. We are the best of what we do
and we attract those high level professionals we want to work with
in our lives. The ones who need to take action. The ones who want
to pay us our value. I don’t know about you folks ( although I
would love to hear) I want the clients in my circle that want to
say “thank you for letting me give you money.” The money is just
the tool when two people swap value. As Warren Buffet said. “Price
is what you pay. Value is what you get. Always Looking Up!
The hardest thing I think is constantly comparing myself to
others and thinking I don’t have the necessary skills when I
actually do and am already a Gluten Free Expert!
Great tips Derek. I always use the so that technique & build in value. I’ve been selling for a long time & it’s always great to hear these tips again to keep you fresh. Thanks also for reminding me of the 2nd point about writing about how to not spend money. I don’t think I’ve done this but it’s made me think I better go check & I’ll certainly be watching out for it in the future.
No expertise to share here – just a question:
How does selling on value relate to offering different packages for services? If I want to stand out as “quality,” how do I offer lower level packages that don’t discourage people from choosing quality?
I made another mistake. Mistake #4: Making a low-price introductory offer, but forgetting to make it SUPER CLEAR this is a super low price.
Of course, no price seems super low to a client, so when I ask for my normal rate. “WHOA! Why so high all of a sudden?” Even though they are still in the middle range.
So, what do you think? No low prices? Or do them, in what circumstances and how?
Ugh I make ALL of these mistakes. I’m trying to target high end, quality people, but yet offer discounts. I talk about all the things I will do, but yet don’t give specific examples of what those things will do for the client. Annnnd I set my pricing below my competitors because I assume that I’m being compared to them, even though I know I offer more than they do. Thank you for being awesome Derek! 🙂
I admire the precious information you offer in your articles. I am going to bookmark your site and have absolutely my children visit here often!!
Awesome! Great tips, Derek! 🙂
These tips are awesome!!! Value and benefits are SO important in getting what you’re worth. Letting your ideal client/customer know how you’re different from your competitors is an awesome way to stand out.
The way I learned the “so that” technique as “which means.” Super powerful stuff here 🙂
I think the “So That” technique will really help me as a build my blog. I’m developing a business as a professional speaker to teenagers, and the benefits of the message seem obvious simply by describing the “product” but you’re absolutely right, people don’t just need to hear about the product they need to have the value reiterated. A simple but huge truth! Great advice Derek!
Hey Derek! Yet another awesome post, and your hair cut looks uber cool 😉 Cheers.
Nice work! This is a great reminder of perceived value and the law of attraction. Be specific and qualify. Also exclusivity works that’s why Apple and BMW can charge so much because owning something from those brands makes you part of an exclusive club.
Nice one Derek. Rite now i have facing this problem, competitor take less so i have to less my price. I will recommend your links to all my friends.
Thanks for sharing a useful information.
Lovely to finally put a face to the name 🙂 I was amazed to see that you are a young man. I had always presumed that you were in your 50’s like me. I think perhaps because of all the wise stuff you come out with. I never thought that you would be so young! Your youth inspires me even more. Looking forward to seeing more of you online. LoVe Pauline.
Headed back to my webpage to add the almighty “so that” to the reasons why people should use my service!
I need to make a list of all the benefits of training with virtually! That way I know a ton of different things to talk about!!
As a psychologist, I know all about the traps we fall into, the stories we tell ourselves, and how we can’t seem to find our way forward. And even knowing all that, I still did it myself! When I doubled my rates for digital strategy services, I found that the ‘quality’ of my clients increased dramatically – no more tire kickers or people wanting something for nothing. Sure, I charge more than some of my competitors (at least in the local market) but my clients still get great value – and no one complains about price any more! Sometimes it’s worth raising prices even if you think you’ll price yourself out of the market – you will probably be surprised to find that you’ve simply moved yourself into a whole different (and better) market.
Always used the “so that” method. In fact, I’m an (unapologetic) “weigh less, achieve more” evangelist. The comma would be the implicit “so that” that you pointed out Derek 🙂
I’m a pretty scientific person and have a huge respect for your well-researched “no non-sense” angle.
All the best from London (UK),
Alejandra
I too love the “so that” technique for expressing value. I’ve heard it before too, but don’t quite remember where. I think that’s one of the best take-a-ways from this video. Also just first mistake of attracting the wrong customers. That’s huge.
The “so that” technique is very helpful to get you out of the “features” mode that sellers are drawn to focus on (at least I was). I think I heard Pat Flynn mention the “so that” technique but I don’t think he claimed origination either.
I still could use a lot of help with my sales pages. I need to learn how to test better.
I listen to Jay and Jeremy at IBM and I used their format to create a “long sales page” not many sales but how do I know if the product is not appealing or if the sales page sucks.
I am a fine artist and in my world, I know that I am a excellent artist. People always admire my work and wish to have it hanging in their homes but always say it is to expensive. How do I draw people to my blog who have discresionary income to buy art. It is purely a luxury item. Trying to figure our how the “so that” would work for me.
Hi Pamela – Sounds like you and I are in similar boats! As a fellow artist with similar challenges, would love to connect with you on this question.
What about the people that are wanting to better themselves online and are broke? Before I started, I was totally broke, and even if the product anyone sold WAS worth the price they charged, I wouldn’t have been able to afford it.
Does this solution really help everyone? I think it helps us boost our confidence in selling our products, whatever they may be, but I also feel that this leaves a lot of people out that would LIKE to be helped but can’t because they don’t have the money it takes to receive the product.
What do you do in that scenario? Do you push them aside and say screw it, the price is still the price? Or do you help everyone?
I love the ‘so that’ technique. Hey, Derek, I can’t find the original reference for it, but here’s a thought. Maybe it’s your next ‘superpower solution’! 🙂
Good stuff Derek… it made me think!
Also, I am commenting SO THAT we will connect 🙂
I totally agree, so many people try (in any manner) just to sell their products. I think its important for small business owner to do the same what big companies do, they do a perfect marketing! Good marketing awakes the needs and requirements in people and gives the solution how to cure the need. And creating feelings and emotions is also very important in my eyes.
Great information, Derek! Definitely gonna apply your tip to my business!!!
The hardest for me was the perception that I am not a salesperson. But I have something to offer and help others. Once I got over this fear based concept I was able to be more confident.
I especially liked your tip “so that”. It was really helpful.
This is so helpful! And the video was very engaging too. Thanks for the tips. Now, I’m encouraged to give more value to what I do.
The hardest part for me is that the well-paying gigs ($1+/word) are harder to come by, and it’s difficult to not accept STEADY work that pays less. I figure my pay per hour is just as good because of the time I don’t have to spend pitching, chasing pay from new-to-me clients, etc.
This is a typical catch-22 for freelancers, I think. I have a similar situation as a musician, and I think the only way to make the better-paying situations more frequent is to force ourselves to reinvest the time and/or money in chasing them. Easier said than done, I realize.
I’m a bit of a culprit for 1 & 2
1) I do talk about how to save money in my blog…I should talk more about how to create a top-quality product and make more money, or create stronger branding.
2) I don’t clearly define the value of my product. Not so much on my website but definitely in client meetings. It’s all very logic based.
Hi, the article absolutely caught my attention. I came to know about this site from Marie Forleo B School. However youtube being banned in my country & proxy could not operate either I am even more eager to see the video. The comments are very motivating too. Do you have a transcript or if you could guide me to addressing this issue it would be a great help. Just by the way I have shared it on facebook
Wow Derek this was one powerful video. The BMW and Apple Computer examples really hit home with me. I prefer to work with someone who appreciates the value of high quality than someone looking to haggle me for a 5 cent savings.
I am going to make sure that every piece of copy contains “so that” going forward.
Thanks for the great video. Please keep them coming.
Guilty of mistake #2
Thank you! Love the ” so that” tip! I like your concise delivery, you don’t beat around the question. I need to add more of that to my stuff! Awesome!
I would add that there’s also the “geography clause” which is a variation on the pricing according to competitors mistake. I’ve been told that in my area, (rural Olympic Peninsula in WA state) people will only pay so much for artwork. So – I’ve expanded my reach to the Seattle area. It’s amazing the difference a 2 or 3 hours drive can make.
Thank you Derek! Discovered you through Creative Live. Im in the midst of a business make over and the info you offer is helping me make decisions Ive struggled with for sometime.
Thanks again!
“Unfortunate freeze frame, alert”? It’s awesome! I’ve downloaded your podcasts for my road trip next week. You Rock!
I moved through all mistakes throughout the years. But mainly #3, comparing myself with other designers has been stopping me and setting, claiming and receiving the prices that my work truly deserves. The stop is really just a conversation in the brain. That needs to shifts immediately. I take that on. 🙂
I definitely need to work on defining and highlighting the benefits I have to offer. I’m just getting started, so I definitely appreciate the reminder to do this!
Maybe the “so that” idea came from Greg Habstritt–I seem to remember his using that concept.
Thanks, Derek! I liked the “so that” part too, it’s easy to remember and reminds me to focus on the value to the client. Not a new concept to me, but it’s really important to remember that when describing what one does, so thanks for the reminder. Your videos are always entertaining to watch! And there’s always good information packed in.
Ay-ay captain!
Mistakes #3 are what I need to work on. The few clients I’m working with presently love my expertise and the result I deliver, they will talk about my work and defend my price before their friends who think my charges are too high.
Derek,
A lot of great points in the video!
I’m looking to add more consulting as part of my business, and this is a great reminder to focus on attracting the right people and make sure to value my time. I’ve been guilty of doing the opposite, for sure, as far as charging less than I should.
Thanks for the video. 🙂
Great advice and insight! It seems to me that many people are unaware of what their time and skill sets are actually worth. I really believe that if more people knew their worth they would be able to more clearly and persuasively communicate it with clients or even employers. My blog focuses a lot on defining your dreams and offers advice and tools to pursue them, so this topic is extremely relevant to me. Thanks for the thought-provoking post!
Hi Derek! Your posts are always great. I’m in a sales program right now and my coach often mentions sharing the benefits. I still forget to do this. And thanks to your video, I will go to website to make sure my services are explained in such a way that my potential clients know the benefit they’ll receive by working with me. Thanks!
I have to say, few things in this world feel as good as doing work you like *and* knowing you’re being paid what you’re worth!
When I started freelance writing, I was lucky to have an editor friend who cultivated me and whose magazine pays a very good rate. I couldn’t believe I could be paid so well to do something that comes very easily to me, but it was a huge benefit to me– I didn’t have to fall into the low-paying “content mill” trap that so many writers do, because I knew for a fact what clients were willing to pay.
After getting some experience under my belt, I could have told you what I thought my value was as far as the quality of my work and my versatility, but I got another advantage from my editor friend after she’d moved on to another job– in the course of a bunch of us talking shop, she told me that in her stable of writers at that magazine, I was one of maybe five writers that she considered her go-to people because I always understood what they wanted with a given article, I turned things around consistently on time, and I was easy to work with– I asked necessary questions but then just got the job done, whereas she had other writers whose hands she had to hold constantly, who had constant questions and needed lots of rewrites.
From my point of view, I was just being professional– I was shocked to learn that what I considered business-as-usual was actually a value benefit to my client! So the moral of the story for me was that you can learn a lot about your value just by asking someone who’s happy with the service you’ve provided.
Thank you for the valuable information. Charging a fair price for my knitwear, patterns and jewelry designs is an ongoing problem. For some reason, many knitters do not put a fair price on their goods, really undervaluing them. So, when I place a fair value, most say I charge too much. Such a dilemma!
Great video – thanks so much. Very timely as I’m updating my site this week. Appreciate your insights!
Great advice on the Web Design tip. I think we loose focus on what exactly a web site is for. It’s not just too look pretty.
You wanna hire me SO THAT you have increase in revenue but designing a highly responsive layout for product/service
I started using a version of the “so that” technique about 10 years ago.
How I got started was to realize how I could use “the 5 why” problem solving technique used in the quality management [push in the early 90’s] to discover what makes a business tick.
The “5 why” is used to discover the root cause of a problem within a business. For example, is sales a slumping one could use the “5 why” to discover the real cause of the problem.
I thought why not turn this around and use the technique to help people dig deep into their business purpose, target market, and value proposition.
I suggest people get with their key advisers and work this technique on their business.
Hey Derek – LOVED your video, thank you! As a freelance copywriter I live and breathe helping people unearth their amazing stories and what they offer to the world that’s unique, and shaping that information into benefits for their customers. For example, most folks emphasize their credentials and achievements in their online and print profiles. But what’s in it for their ideal audience? Why should they care?
To stand out and get noticed, excite interest, express “I’m the perfect person for you,” and motivate contact—all in a few seconds!—it’s like you said, translate HOW your credentials and achievements, and vision, passion, strengths and skills energize and empower your ideal audience, provide an immediate, positive impact for their benefit, and create lasting, welcomed forward drive for their mission.
Am I struggling with being paid what I’m worth? You betcha. It seems some people really get it, that paying someone to write for them is an investment in their brand identity. Many others believe “of course I can write,” so prefer to save money (that’s a story in itself!).
I’ve got #2 down, though believe me I’ve been working on this hard (new website launching soon > chock full of BTC techniques:)!! Expressing your value and how it benefits your ideal audience takes and deserves time and reflection, and sleeping on it, and tweaking it, and putting yourself into your customers shoes’ and answering, from their perspective, “what are my greatest needs and fears and desires?”
#3? This is my greatest challenge. I’m still pricing myself at advanced beginner to intermediate pricing but scared the market won’t bear the “big boys” rate I’d like to charge. So I’m creeping up my rates over the years instead of taking a big leap. Aghhh! Gotta get over that and believe, “I’m like BMW – charge and they’ll come.” I’ll keep yah posted;)
Thank you thank you again, Derek, for a topic dear to my heart and the challenge to do better.
I am going to use this at our next meeting to create a list of “So That’s”
Thanks for drilling down this subject into 3 key points, and also for offering actionable solutions. Great video!
Agree with you Elsa. This is a great post for us start become more compelling about our services and start attract more high caliber clients.
Hi Derek,
So funny, I was sitting here thinking, yeah, I hear you BUT my ideal client is a stay at home mom who is frequently looking for a “deal” because they are working with one income. THEN you talked about APPLE. Ah ha moment! Apple does charge more and guess what, all those ideal clients have multiple Apple products so they CAN spend money when they WANT to – when they feel it is “worth it”. Now back to positioning myself to show why I am “worth it”. Gotta use the “so that” to get there… genius! Thank you for opening my eyes this morning!
Alright Guys, Listen up,
I think what Derek Halpern Was trying to say in his video was the following:
Whatever your selling, ALWAYS mention the
BENEFITS, and not the FEATURES
This is what i learnt in a master class marketing conference (cost me £1100)
Simply put, in the web design example, Benefits are:
You will get more customers, You get more leads, you get a brand, ect ect
Features are: 5 Page Website Design, outstanding Logo, HTML pages and SEO , blah blah blah……
Just remember, in all you marketing copy, Mention the Benefits, and NOT the Features.
Hope it helps.
This is a great video. When I learned about virtual assistants, letting other people know my value was my fear. A change of mindset helped me get through it.
I love the “so-that” that you said. I’ll remember that; so helpful.
Derek, great video! It just fits soooo much into the mosaic that has been coming together for me lately. As a certified, experienced coach but beginner entrepreneur I had this big Aha moment last week – I HAVE TO STOP selling coaching and NEED TO START selling the results I can deliver for my ideal customers. It’s pretty obvious, right? But OMG there had been such a long complicated journey to this simple solution :-). Thanks for your work, I am your big fan!
great video Derek. The whole commodity comparison is spot on dude. I often use the simple example of when people introduce themselves by their job titles. (without the ‘so that..’ idea you mentioned). Basically by doing this we group ourselves with ALL other who have the same title or the same skills. And this is what makes us a commodity. People do not get excited about commodities and commodities as we know compete on price! (Hence not getting paid what your true value is!)
Awesome video! Always full of value. You do look like a ninja at the end when the lights goes out! Sure make me laugh after you were so serious with your video.
Fantastic. Thank you. It’s great to know that by telling people the unique benefits they will receive from my program, this is what they are buying in to, not all the features and inclusions..
Hi Derek
I think I am guilty of number one, perhaps number 2 and a bit of 3 as well. Your article was a bit of a kick in the stomach for me to wake up. The irony is…. I am a Website Designer, so you got me.
For number one, I tend to be a nice guy always giving a way free advice and help. So people take advantage of that, so my partner says and I get paid less.
I don’t think I did too badly on number 2 though, I probably need to tweak a bit of my message with the ” so that ” technique.
Number 3, yeah I am guilty of under charge and comparing with competitors, but I am no long a newbie at this game so I have wised up a little in this area.
I would love your feedback on my current website, we are completely re-branding so feedback would be appreciated.
I’m especially prone to #2 and #3. Part of my issue is that I am plagued with doubt about my value. I think the “so that” technique is perfect for helping me find my value, and figure out what, exactly, it is I do that is worth so damn much.
Hey Derek,
I’m one of your subscribers who doesn’t post very often (like never). I thought I would do so just this one time so you know I am reading your stuff. As a matter of fact, I read all the stuff you put out and the same for everything from Pat Flynn. You guys rock. Good, valuable info with no hype.
BTW – no, I don’t think you look like a ninja (sorry, but keep trying).
t
Hey Derek!
Thanks for the great tips. EXACTLY what I needed to hear. I am going to stop worrying about what my customers CAN AFFORD and now focus on the VALUE I bring. I heard the “SO THAT” concept before from Brendon Burchard.
I was offering a 5 ebook weight loss package for $27.00 and was selling one or 2 a month. I read a book that said you have to offer a low, middle, and high price for your products. So I pulled out 2 ebooks and priced them at $27.00, I made the 5 ebook package available for $47.00 and then I added a few more ebooks and made a $89.00 package. I almost died the month I sold a $27.00, a $47.00 and a $89.00 all in the same month. Now even if I sell only a $89.00 for the month as is happening this month I am ahead. The book went on to say that most people want choices and will normally choice the middle price.
Hi Derek!
I think I do 1 and 2 to a degree. I don’t do things that make me attract bargain customers, but I think I have a sympathy for people with no money that makes we want to discount for everyone (though I resist the urge! most of the time…) And for 2, I’m not great at explaining how helpful I am because I don’t want to be pushy. But, that just means that those people don’t get helped, and that’s no good for anyone. I like the “so that” idea. Going to go check my copy and see if it will help.
Thanks for all the tips!
Hi Derek,
Great topic, a perennial, and one I’m thinking about right now as I realise I’ve locked in what should have been a premium product at a too low price and now I have nowhere to go but down! Argh. My big ‘story’ on my pricing is that it’s all people can afford. And yet, inexplicably (to my inner story teller) my competitors seem to be able to get away with charging more! It’s a boggy place with no reason in that part of my mind, I can tell you.
Derek,
I don’t think my last comment went through. Maybe becuase I attached a link, idk…
Either way I think the “so” comes from Perry Belchers 8 questions to ask to proof his “21 Step Salesletter Formula”.
Thanks all the advice and tips here on Social Triggers. I’m new to the idea of selling online and hope to soon use your “Drafting Technique” to help promote a great product I finally developed!
Gosh Derek, great video and can safely say I suffer with all three lol!!
just starting out so to be expected maybe, but I have just taken action after the video and crafted up my ‘values’ and ‘so that’ statement and here it is and now feel very confortable about what I offer at the price I want to charge
Thanks so much, as dedicated follower of yours 🙂
“I gift my clients with knowledge of how to run safely without injuries, so that they can run with confidence and ease, and fall in with love with running and really enjoy it’
Derek what do you think of my statement? is it too long or just right?
Do you think I add value?
Loved this video Derek! I’m currently working on finding the “perfect” price for this new premium program I am creating – and this video was amazing help.
Looking forward to your next video!
PS. Awesome freeze frame 🙂
Nice video, Derek. Three really helpful tips.
One of the things we’re considering at the moment is the pricing of products across different formats. We’re shortly to release a programme (ebook and audio downloads), but recognise that this could also be released as an audio book, an iPad edition, Kindle, etc and when you look at the pricing across these various platforms they vary enormously often for not much difference in the content. We’d welcome any ideas from you or your other readers on the best approach.
Keep up the good work.
Love this video Derek and so timely. I create sacred vibrational aromatherapy products using certified organic ingredients. I am constantly faced with comparisons with products that are mass produced in a factory. Hardly the same thing….as something using containing the best ingredients that is personally handmade for you.
I’ve realised that I need to put my prices up – and completely differentiate myself. I can’t compete on price (and haven’t even covered my costs so far). Time to get real and really value the quality and integrity of my work. Great reminder!
Michelle the luxury market loves your product and wants to pay more for it because they know how special it will make them feel. If people are comparing it to mass market products, tell them to go buy some and see how they feel after they use them. Invite them to come back to you when they’re ready. If they don’t come back, they’re not your market anyway.
I suffer from a couple of these.
I think the biggie is comparing my prices to that of the competition… which is stupid, because I offer things they don’t and am positioned for different people.
It’s like you said with BMW versus Audi – they appeal to different markets and thus their prices are irrelevant compared to one another.
I guess that’s where positioning comes in.
Charge what you know you are worth.
If you have the expertise to back up your pricing structure, then there is no reason to adjust your prices, except in an upward direction as your expertise increases in your chosen field.
I have turned down many a project because a prospective client says “you are too expensive”; but on the other hand, I have gained many clients who were prepared to pay my fee, and now come back and use my design services over and over again.
Once you are a client, I will never compromise on my fees, as both you and I know that whatever I may charge for accepting a project of yours in the future, you are receiving value for money.
Awesome Video Derick.
Could not agree more! I recently wrote an article about tips for negotiating a higher salary. Check it out sometime.
Hey Derek,
the “so that” technique comes from Ramit Sethi. At least, I’ve learned it from him 😉
Great video anyway!
Derick,
You forgot the “so that” in the end of your video. “So that I get more likes on this video.” “If you like this video subscribe to it so that you’ll…”
With all that said I like what you had to offer for content. Not exactly Seth Godin or Gary Vanerchuk but still both entertaining and poinent. Keep it up. I’ve subscribed to your email
Great information, as always, Derek! Thank you – I love the “so that …” concept. I definitely will use that one.
What great timing, I was thinking about my prices only today. Should I lower them! People like the free stuff and want to have lots of the value added to their business but some see that mentoring / coaching is not what they should be spending their money on, as prefer ‘actualy’ products. However, I should be focusing on people that value the results they will receive more.
I was then thinking I wasn’t descriptive enough and the ‘so that’ fits perfectly in to why my ideal clients can benefit from my 20 years in the Martial Arts, love ninja’s 🙂
Brilliant Derek! This is exactly how I am trying to change my branding and content. In Real Estate lots of Realtors are always lowering their commissions to try and get more business. I am trying to get our prospects to focus more on the value we provide with our years of experience and negotiating skills which will save them money on their purchase price of their home, but not to discount the commission we charge. This is right where I want to head with my business.
Hi Derek, Lots to think about as always… Thank you….How does a fine art photographer of many years tastefully promote themselves without bringing down the value of their work…I want to attract a new younger buying public, so prices need to be reasonable…but I have expensive work in the studio as well. Also how do you talk about art using “so that” without sounding cheesy?
My biggest aha moment was when Derek was all “if you keep talking about ways not to spend money, no one will spend money on you.”
See, I do attract the right audience, which is new-to-online marketing entrepreneurs. And I often talk about the free & low-cost tools that are out there. But to me, it was always obvious that you use the free tools & such so that you have more money to spend on the important things, like individual coaching.
After watching this video, I realize that I need to include the “so that” part in my blog posts, etc, so while I do talk about free resources, people get used to the idea that you still have to spend money on the things that matter to your business (like coaching & training programs).
Several good points here, Derek. There’s yet another, however, that you didn’t mention — though perhaps you don’t consider it germane.
One’s audience is one’s market, and the market sets the price for any good or service. Therefore, assuming one has the right audience, one must also consider the possibility that their product/service is not as competitive on a value basis as they think it is. Sometimes a little self honesty, followed by the hard work and commitment to improve that value, is what’s needed.
Great video. Love the “so that” and always stating the benefits vs. the features.
Excellent point about transitioning with “…so that…” Or as some of us would cite, use the WIIFM – What’s In It For Me (i.e., the prospect). To your point, selling begins with the CNA – Customer Needs Assessment. So we need to first listen/understand what the prospect/client want before we start blathering about all the features/functions/value of our product or service. And as you suggest, market segmentation is a biggie – targeting the right customers, which presumes at least a cursory market segmentation study, A-B split stream study, etc. One more note regarding the sales funnel… before the target audience is in the prospect phase (known to us) and merely suspects, we need to first focus on a succinct elevator pitch that minimally contains:
1. Who are you?
2. Describe the pain
3. Highlight your solution
4. Call to action (next step in the sales funnel process leading to a sale)
Happy trails, Michael
“so that” freakin genius! Total ninja!
Great video and awesome topic! Independents also sell themselves short, just to get some sales and customers. But, as Derek mentioned it is a mistake. Another way to look at this is market positioning. Are you serving the high end, mid-tier or low end (nothing wrong with low-end, Walmart makes like $10B per day). Know who you are, what you are selling and to what market segment. That helps to keep pricing in line.
Derick,
You forgot the “so that” in the end of your video. “So that I get more likes on this video.” “If you like this video subscribe to it so that you’ll…”
With all that said I like what you had to offer for content. Not exactly Seth Godin or Gary Vanerchuk but still both entertaining and poinent. Keep it up. I’ve subscribed to your email
I think most people have a really hard time saying they’re worth more than their competitor.
My struggle is not that I’m afraid to sell for more (because we truly offer a superior product), it’s that when times get lean, it’s real easy to say “I need a project. I’ll budge on price this time.”
I’d much rather get 5 really great paying projects with people that understand the value than 15 super crappy projects with people that are a nightmare to work with… and make the same.
Yes, you look like a ninja.
People don’t respect themselves to ask for what they are worth, so they settle for less, and feel cheated. Base your price on what you ARE worth, not what you feel you are worth.
I offer life guidance and spiritual direction, and I am applying the “SO THAT’ method to my work as well. Thank you Derek!
I struggle with charging more than what people can afford. I don’t want to come across as greedy.
I really think the “so that” technique is important for me. To remind myself of why I am making jewelry and to educate my customers.
Thank you
Bobbie,
I would ask you why you struggle with that question…”can’t afford”.
Either you do not believe that the product you are offering has no value and what you are charging at any price is a scam or that you believe everyone should be given what ever they want for free.
You said you are making jewelry. I know the amount of time, creativity and skill you muster to produce a single piece of art. Don’t you feel that you mental value, creativity and technical acumen has value? There is absolutely no difference between what you do and that of a brain surgen except he paid lot of money to have the same dexterity.
If you can’t get over yourself than none of this “so that” will help you. You must become the person who can comand the value you seek.
My product is excellent. But I guess I am idealistic, thinking that I would like everyone to afford what I make.
I can think of one more difference between me and a brain surgen, they save lives.
I do appreciate your encouragement. Oh, and I am working on getting over myself.
Going to star using the “so that” technique thanks again for this video and yea you look like a ninja lol
Hi Derek
YAY! This is awesome. This is big for me because in the fall 2012, I got a customer who stopped paying for my website services because “he can get a website for $1 a month”. I was just speechless that a customer was comparing my value to $1…really?!!
I got over it and that was fine because it became clear to me that I did not emphasis or explain my value on my website (hence, it is off-line now since I am re-working it).
I am really getting together a nice list of how much value I provide and it will be all good in the end. Thanks so much for this topic!
Yes I found it so difficult to define exactly what benefit I bring as a Quality Consultant – especially when most people roll their eyes at ISO9001 and Quality in general! However, I am currently re-writing all my website material to focus on benefits, benefits, benefits! My blogs will focus on that too from now on! Thanks for the re-enforcement I am going down right track!
Definitely used to be guilty of #2 – not showing/proving/explaining the value.
Once I started doing that, I started to attract the right people and am really, really, really able to differentiate myself from the “competition.”
I’m almost arrogant now about how much I can help someone transform their workflow, time management, and business systems. I’m no ordinary “professional organizer” and I prove it to my potential clients over and over.
Another home run. This seems to work perfectly for a service business. I once had a business selling Ukuleles where no one was honoring the MAP pricing and there was only a margin of a couple of dollars per sale.
Does anyone have any ideas on how to apply what Derek is talking about to a product business (in particular a product that you don’t produce)?
There must be a value to a customer that the product gives or take a look at these questions: why it is best to buy the product from you, consider any extras that you provide with the product, does the product solve a problem for a customer, etc.
Michael,
If you and the rest of the world are selling the exact same product and the only clevage is you…either you really need to give one hell of a service or you are screwed.
We live in a time where the customer is in total control. They come into our stores, look at the product, feel and smell the product, and than pull out their smart phones and check online what the price is.
You job is to provide so much value to them when they enter your establishment that they would only buy from you. This could be as simple as when they walk into your establishment instead of asking, “Can I help you?” you ask , “Is this you frirst time in our store or are have you been here before?…(no matter how they answer)…Great! We have some really cool things that we just got in for customers like you!”
Why is it that some stores are still going bonkers in this ecconomy while most are struggling. Only because of how they create value to their customers.
I 2nd Michael Spencer’s comment. I would like to know that too.
Great video Derek,
I know that “so that” technique as well. I can’t for the life of me remember where I saw it either. Was thinking it was Gary Bencivenga, but not totally sure.
I like the “Stop talking about competitors” tip – I think I’ve done this more than I’ve realized. Often though the customer will ask me to compare them against me, what would you suggest I do in this case?
…the “so that….” technique. BRILLIANT hands down that makes perfect concrete sense. Derek, you just made my day, where I felt like I was spinning my wheels (what can I say, I live in MA, it’s been a tough week) SOOOOO much better. You rock 🙂
Oh YES! And especially the SO THAT.
Realise that my ideal customer though is someone who indeed does not have a lot of money to spend! I provide a place of spiritual sanctuary and sustenance (The Vine @ Mays Farm) which is specifically for those in full time Christian ministry who need time out for renewal and recharging of their spiritual batteries!
But even here, I can see how the three mistakes could be used positively, to ensure that I earn my own crust of bread! We are offering this SO THAT they have the time of refreshment and renewal which they need SO THAT they avoid burnout ….
Many thanks, Derek!
I definitely struggle with #3. I sell digital scrapbook product and unfortunately, the market is TOTALLY undervalued. There’s lots of cheap product to compete with (some is complete crap, while others are great product). Most customers are used to getting a lot for a little.
Fortunately, I’m at a shop that has higher standard pricing than most stores, but we still struggle to stay competitive. I just have to remind myself that my product is worth more.
Hi Derek,
My biggest “aha” moment came when I was looking for a new job while working at a corporate gig. It hit me that I was the commodity! No one cared about me, or what I wanted to do, or my real strengths. I realized that, in my industry, I was going nowhere. I did not want to die being a “slave” (read James Altucher’s “Why Do People Hate Their Jobs?”). I am now out on my own. But, the real trick, Derek, the real trick is FINDING those people who are willing to pay you what you are worth. That seems to take the most time.
Thanks for the morning “kick-in-the-ass”!
-Roger
My fear is that my prices will be too high and they won’t want to work with me. Not sure why that’s a fear though – because I don’t chase after people anymore.
#2 is my big mistake. I have not sold the value. I’m a integrative doctor.
I help women solve their weight issues once and for all so that they can live their life to the fullest.
Is that specific enough?
Or “….so that they never have to worry about it again.”
Or “….so that their are never stuck in the grocery store, staring at food and wondering if it’s “good or bad” to eat. ”
Am I getting it?
‘so that calorie counting becomes a distant memory’. Hallelujah! how amazing that would be 😉
Derek..
Promise me your head won’t get any bigger.. haha but I LOVE you! LOL You offer killer info!
You are one of the top 5 peeps I listen to.. and even mentioned you when I wrote a post on website conversions.. You were the one who taught me to declutter my site.
My ‘aha’ was when you said if you’re always talking about saving money.. you’ll attract people who don’t want to spend.
I don’t know that I do that.. but because finance is a strength for me, I guest post on finance blogs. I was considering writing for some of the big “frugal” sites.. and I thought to myself “Why?” Why would I build relationships with people who are frugal when my solution to wanting to buy something is just to make more money!
Once again, you delivered an edgy, applicable solution to an age old problem.
darlene 🙂
I suppose I’m struggling with #1, but I’m not sure how to attract different people unless I were to change my product, which would be difficult considering that I create a certain brand of handmade jewelry.
Our biggest issue is how quickly to raise prices. I made the mistake of starting too low, but I don’t want to raise prices too fast.
Jessica
One idea would be do some type of level up with existing customers (ie in 3,6,12 months go up in stages somehow) – be sure you can articulate the value you offer or even little extras you can provide so they understand the increase. I would suggest immediately charging your value prices with any new customers.
Hi Derek,
Great info. Definitely going to concentrate on attracting the right audience and not paying too much attention to competitors’ pricing. However, as an artist selling art, I’m wondering how I can fill in my “so that…” statement. I create art so that my customers… can enjoy my art?? Not very compelling. In other words, the benefit of art is a less tangible thing, a sense of aesthetic enjoyment, so how do I articulate that as a “so that”, and especially one that is different from any other artist out there? I’d love to hear your thoughts on this.
I have a class called “Debt Free in 18 Months” that I offer for $10 and I have been wondering why the sales have been so low. I have a video on the webpage from a TV interview that I did, however, now I think that I need to have a video of just me articulating the value clearly. I really need to hammer home the benefits for the customer. Thanks for the insight Derek!
Right on Dewane.
My experience has been that your audience / clientele is like a mirror. They reflect to you *exactly* where your current self-worth stands. It’s a useful tool but often a bit painful as you realize that you are valuing your own work at exactly zero! Helping people for free is a really important part of being generous, and I do it 99% of the time, but that just makes it all the more important that I actually charge a reasonable rate in that 1% when I do charge.
Like most freelancers, I gotta eat. And food costs money!
Oh, this a topic totally dear to my heart – Thank You Derek!
While I help businesses with fundamentals & smart growth – pricing strategy and offer optimization is my main passion (crazy I know). Customer Value is a huge part of this – you have got to voice your value – listen to the man people!
Another mistake I see is the standard charging by the hour – there are better options for you and for your customer. I’m currently finishing up my Superpower Solution that addresses pricing for profit issues – am even hoping to get Derek to participate in a business $ review 😉 If I can help anyone please let me know.
Excellent Derek, as always!
I own a flower shop and find brides are the most difficult people to work with. Value of service does not seem very important to them as much as cheapness of product. I do use the “so that” when I am explaining the value of my product and work but perhaps need do do more. I am going to review it and make sure that I am doing a better job of it. Thanks for rattling my chain!
The “so that” technique reminds me of the technique that improve professionals use is “yes, and…”
http://www.pantheater.com/articles-rules-of-improv-part-i-improv-comedy.html
Great video Derek. Thanks for sharing. I have passed it on to my strategic partners.
Mike J
Great stuff, Derek. I’m a sucker for only telling the “what” and not explaining the benefits. Great reminder.
Your “so that” principle sound much like the formula Michael Port uses in his “book yourself solid” book. I digged deep into his book and his principles and he basicly breaks his formula into 3 parts.
1st the “[who] and [do what]” section. Your focus should be the client rather than explaining your services.
This is mine:
“I help small business owners get more and better clients by using a mix of web and marketing strategies that are best suited for their needs”.
The 2nd section describes why you do it. It strengthens the relationship with whoever you’re talking to
” I do that because most of the businesses i know could greatly benefit from using the internet the right way. They miss a ton of opportunities.”.
the 3rd part is about having a tag-line. In my country there is no use for that but your audience might benefit from it.
Just think of it as a short sentence that describes how you’re going to be awesome, unique persistent in a particular matter. Stuff like that. Be “Rememberable”
There is a lot more valuable stuff inside his book but i’d rather skip here, since reviewing his book should not happen inside of a comment 🙂
In the link below you’ll find a screenshot of a more detailed breakdown of what i just wrote. Someone from Michaels community put everything in his book together in one giant mindmap.
http://michaeluszleit.de/wp-content/uploads/2013/04/bys-breakdown.png
Very helpful post Michael, thank you!!
“They set their pricing based on what they’re selling – what they’re value is.” Perfectly said!
I think this is so crucial for companies and brands. In my opinion, one very important key is to truly believe in your brand/company/etc and what it represents *100%*. If you commit to framing your brand as one of high quality and have the benefits and results to back it up, you end up being alot more successful in getting paid the rate you think you should be paid.
Great video.
Got another question: How do you stand out in the MacAppStore? There is tons of software in the 1-2 Dollar range.
And like Sarah I have problems talking about the benefits of the software I sell.
Love your way of breaking these things down! Makes sooooo much sense! Especially the “so that” technique. Thanks!!!
Have to say that attracting the right customers is likely my “problem” however, I’ve been grateful for each of them as I’ve never had to advertise/market my services because it’s been 100% referral based: small, local business with a lean budget. And I’ve kept my prices in-line with their financial abilities vs earning a living wage.
“So that” leads to how to attract a higher paying client within this niche?
Thanks for the insights, Derek.
Pretty astonishing that 100% of the people you surveyed said that they believed they were getting paid less than they were worth.
I’ve absolutely dealt with all three of the mistakes you described. I’ve worked to fix my position, but definitely good to watch you continue to put these issues into perspective with suggestions on how to correct the problem.
I learned a long time ago, you only get what you negotiate. Nothing more, nothing less.
“So That” Love that and so often left out. Stamping in head!
Awesome advice. Thank you, Derek. You are always “Like”able! And I’m posting your video today on Facebook SO THAT my friends can fall in like with you, too. http://www.facebook.com/kristinfritzstudio
THANK YOU! I needed to hear this… spoke right to me. You da man!
Great video Derek and Sarah is right about the ‘so that’ technique – very effective. Its a little like the 7 Whys? in other fields.
And those ‘out-takes’ at the end are excellent!
Derek–
Totally call you Dave .. :(. Please delete that part!
*So embarrassed* I’m a web designer my site just fell in the clique you just described!
I also make the #2 mistake often “I charge what my competition does”
Looks like I have some copy work to do. Thanks for the ‘so that’ technique! So using it 🙂
Great tips as usual!! You’re Awesome!!
Hi Derek,
First, I love your videos! THANK YOU!
Regarding my pricing, I’m guilty of both mistakes #1 and #2.
I definitely attract a crowd that is looking for a deal and they seem to overlook my value. Which leads me to, I guess I just am not good at explaining my value for the very reason you mentioned….I think it’s obvious and that people would know themselves. But I like your “so that” technique; it’s a perfect way to lead into the value we all bring.
I am about to launch my new site next week that will hopefully address these areas. Thank you!
Well there ya’ go. I need to go rewrite my web design sale page. Thanks Derek. No one drives it home like you do.
Dave–
Insightful as always. This video came at the right moment. I am starting another venture guided to the Latino market in their language and it is not the same to sell in South America as it is here in the U.S. Even here, the Hispanic population tends to far pay less for their products.
Like you said, some competitors definitely charge way less for programs like the ones sold by big Internet personalities here which command about $2000 per training course. how to deal with this?
Any advice? This is a perfect example, people charge $300 for a typical video course sold here that maybe worth $2000.
What to do?
“Pony up” 🙂 Haven’t heard that in a while. Your “value” topic is great. Like most business owners there are some who don’t buy but thankfully I have many that do. What I love is that you talk about the type of audience a business owner draws. That is really a great tip and something to consider when you are selling a product or service. – TY
I’m soooo going to do more VALUE for my CLIENT “so that…” descriptions! Many many many thanks for yet another brilliant video, Derek!
Like you, Karin, for me it’s about communicating the value. I’m still learning how to do it clearly in writing.
Yes! All over this like a tramp on hot chips!
I reckon I’ve probably been guilty of all three at some point (I’m a web designer, so actually your video was uber-relevant). It’s so easy to look at the competition – and with web designers you don’t need to look very far as we’re all over the place – and to ignore the things that you’re doing that might be bringing down your value to clients.
Awesome, thanks Derek!
Great tips Derek, you do look like a ninja. Kinda. Will you tell us what lighting and camera you use… so that we can make quality videos and raise our rates?
BTC graduate here and I’m struggling with this very issue right now… I’m JUST about to launch an ebook – a 56 page, full color recipe guide with 20 supreme dessert recipes and 20 health-promoting techniques to help my readers embrace their allergies, conquer their cravings and liberate their dessert dilemma.
Based on what I learned at BTC (like the ‘so that technique’ you mentioned) I tell people that the book will help them: Enjoy desserts… guilt-free, crush their sugar cravings, fall in love with their food sensitivities, allergies and restrictions and overcome your restrictions
But I still don’t know how much to charge! I’m stuck in the competitor game – comparing my product to all of those out there and thinking $14.95 is just too much, fearing that I wont get any sales. Maybe pricing at $9.95 would be smarter? You know, price lower to get more sales, and end up making more in the long run anyways? Any suggestions?
Hi Leanne, I’m a big fan of your website and for what its worth $9.95 is WAY too cheap. I know how good your recipes are and I know how amazing the photographs will be. I’m really looking forward to buying your book.
Hi Leanne, fellow BTC grad! I have to say, the way you just described your book (and I’m the author of many books) makes me think you are priced WAY low. Frankly, from your description and what your book can do – you should NOT go less than 30 and the price that comes to my mind is $49.95. The health benefits sounds tremendous and people pay thousands to deal with those issues. Just my honest response for what it’s worth. lol.
Thank you, Karen! Your advice is priceless. Thanks again!
Hi, Leanne! Do you have a website? Your ebook sound really interesting!
I used to worry about #3, but now I realize that I offer a service that is much better than my competition. When I recently raised my rates, not one person batted an eyelash. In fact, one person said, “You’re totally worth it!”
Mistake #2 is definitely what I used to suffer with.
However, after I started blogging on my niche which is graphic design, clients started to appreciate the value of what I do and they were more than happy paying for it.
yes! the second point really resonated with me, too. i look forward to implementing that in my copy. thank you!!!
Awesome! I know that I need to improve my sales skills, great tips Derek as always
Love the “so that” technique. Just had an AHA moment. Thank you!
Me too!
So that you can go on that trip with your toddlers, so that you can smile at your partner when he comes home, so that…Wow my mind is just racing with endless possibilities!
Thank you Derek! 🙂
The hardest part for me is absolutely Mistake #2. It’s very easy for me to explain “what” I sell, but I often waffle or feel cheesy talking about the benefits that that “what” brings to my freelance writing customers.
Loving the “so that” trick and absolutely going to try putting that into practice!
Me too! Consider it fixed. BWTW – Derek – nice haircut.
I always fell into this trap too. I remember how passionate I am when I talk about my service. What I don’t realize is that my clients don’t care about that. They want something valuable for them, not some salesy person talking about his service.
I agree but I have always found that my passion and enthusiasm also sells as long as the customer benefit “the so that” is there as well. Sometimes your not the only one with great so thats. Then it’s you they are buying and so the passion is still needed to make you stand out from the crowd.
Found the video inspiring .
Bryan
It happens to me too. I’m very enthusiastic in telling people what I do without thinking if that is what my customers want. I’m trying to learn how to listen more, so that I can help them better. This way, I can provide value.
Wow. I can’t imagine that I use “so that” technique even in the comment section. 🙂
I worry about people not being able to afford things due to the economy, there are 101 million working age Americans out of work…