No matter what you’re doing personal branding for, there will come a time you’ll get asked that terrifying question: “how much?” That’s the one most people struggle with the most: you don’t want to be too high – or you won’t get the business, and you don’t want to be too low – or you’ll end up feeling taken advantage of.
The problem is, your client or your future employer is looking to get the best value for their money. (As they should!) So how can you handle that situation when you name an amount and get the inevitable lower offer?
A mentor of mine told me a story that really clarified how important it is for you to trust that the amount you’re naming for your service is worth it’s value. When my mentor was just starting to work as a salesperson, she had a client extremely interested in the service she was selling. She thought that she had the sale all lined up, when he asked her the question that every person in sales hates: “Can you give me a lower price?”
My mentor really wanted to make this sale, but she had already quoted a great price. So she looked her prospect right in the eye and said “Sure. I can absolutely give you a lower price. Let’s talk about what part of the service you want to cut back on to get to the amount you want to pay.”
She got the sale – at her original price. And her customer confessed that he had been testing her. If my mentor had been willing to drop her price just to make a sale, he would have known that she was padding the price she quoted to him. But because my mentor stood firm – and said she’d have to cut part of the service to reach the price he needed – her prospective customer knew that my mentor was giving him a price she believed was fair.
Hearing that story was a revelation to me. It taught me that being the lowest bidder isn’t necessarily the best way to make a sale. It’s more important to be confident that the product or service you’re offering is worth the price you quoted for it.
Since I heard that story, I’ve found myself in those types of situations many times. When I was a beginning freelance writer, the prevailing wisdom is that if you want to get clients as a writer, you have to build your business by being the cheapest one out there. You work for free to build a body of work, and then for peanuts to get higher profile samples, and then eventually, you earn your way to the big bucks. (But usually you burn out before you get to that point.)
But doing this has a huge disadvantage. If you value your services as worth only $5/article, your clients will also see your work as only being worth $5. And serious business people don’t want to hire bottom-of-the-barrel writers. They want to hire great writers who can give them the high-quality content they need. So even if you are the greatest business writer in the world, offering to work for the lowest price tells your prospects that you feel you offer a low value amount of service.
So, when I started working as a freelance writer, I started off at a rate that was still reasonable, but that also communicated to my clients that I was a professional writer. And because I was confident that my services were worth the amount I quoted to them, my clients felt confident in that as well. And when they needed a lower price, I remembered my mentor’s story and gave them options for what they could cut to reach that lower price.
So how do you get this type of confidence that you’re naming the right number?
- Know your market. You have to know what is a reasonable, fair value for your product or services. If you don’t know how the market values what you are offering, you are at a distinct disadvantage. In those cases, you risk giving an estimate that is either way too high, or way too low. Either way, your prospect loses confidence that you’re offering them the best value for their money.
- Know exactly what it takes to deliver your product or service. If you have no idea what goes into your products or services, you have no idea if you’re giving a reasonable price estimate or not. But if you know that it takes 4 hours of preparation time and 10 hours to write a White Paper – or you know that bringing in Neurologists to be respondents for a project costs a certain amount, you are able to justify the price you’re telling your prospect – and that’s a powerful tool.
- And most importantly, hold your ground. If someone asks you for a lower price, don’t just give it to them. You know you are offering a fair estimate for the value of your product or services – so if your prospect needs to go lower in price, give them some options about what can be taken away to reach that price.
Especially in this tight economy, your clients or employer will want to get the best value for their money. And giving your clients/employers the best value for their money should be your goal as well. But that doesn’t mean you have to give everything away. Instead, you need to be confident that your products or services are worth the price you’re quoting. And standing up for the value you provide is an important part of showing that you are worth what you’re asking.
After all, if you don’t believe it, why should they?
Katie Konrath blogs about creativity, innovation and “ideas so fresh… they should be slapped” at www.getfreshminds.com. She works for leading innovation company, Ideas To Go, and attributes her job to personal branding – both through her blog and by attending the events in her field.