The Secret Ingredient to Charging More and Keeping Customers Happy3 min read
As someone who was included in big number sales while working for medium to big-sized corporations, and also someone who is running my own small IT business (one-man show) I’ve been in all sorts of situations when negotiating and dealing with the pricing, and the overall process of defining the budget for projects.
To be pretty clear, there are two types of customers – those who consider a $10k application unreasonably expensive and those who consider it ridiculously cheap. The key lies in finding enough of the latter type to establish a successful company.
It is impossible to make substantial profits by working for the former type.
Scaling a business is unattainable while catering solely to their needs.
Furthermore, hiring competent management to drive decision-making and company growth becomes unaffordable when serving this group.
Here’s the truth: A customer who spends $100 will demand extra services, request extended working hours, express dissatisfaction with results, and urgently seek communication regarding any issues with the bill.
On the other hand, a customer who invests $10,000 simply requests an invoice without any fuss.
In order to build a successful company you should:
#1 Price your services
#2 Find customers who will pay more, and ditch all those who are looking for the cheapest option possible
#3 Hire top people who will add value to the price tag you are offering to the end client
This is the spinning wheel that needs to keep spinning. In the end, it generates more value, revenue, satisfaction, and growth in every aspect of your business.
Keeping low prices for those cheapskate customers keeps your business in a lower league thus in survival mode. Which is a constant struggle and dancing on the verge of falling off the cliff and closing the business.
Here is my take:
- FIRE that 💩 customer.
- The Customer IS NOT always right PERIOD
I saw sooo many customers to be manipulative, difficult, dismissive, being a true asshole or simply unable to support your business growth.
So why should you deal with them when they inflict damage to you and your business!? Your mental and business health should be a priority. If you are dealing with the 💩 customers, your employees will soon become frustrated as well.
Recap: FIRE THAT 💩 customer.
There are plenty of businesses that are focused on those types of clients, just recommend them to somebody else. Make everyone a huge favor. It’s much better in the long run.
Just like in project management, in business too, you have that IRON TRIANGLE:
- Price
- Speed
- Quality
You simply cannot have all of the three angles fulfilled or checked.
Let’s say you opt for the cheapest possible solution, it’s impossible to have the fastest or the highest quality delivery.
Vice versa:
Delivery with the highest quality and fastest delivery, cannot be the cheapest option.
If trying to mix the two, the third option will always suffer.
To run a truly successful business you should ALWAYS FOCUS on these two:
#2 and #3.
Focusing on EXCEPTIONAL services towards customers with 💰 budget will make your business thrive.
If you focus on a price, you will never deliver great value and it’s a matter of time when you will run out of business due to constant struggle and price dumping. It’s simply not sustainable.
So if you are someone who is directly involved in pricing strategy and client acquisition, just make the offer to the customer that they feel so stupid, they cannot say NO to.
NEVER DUMP THE PRICE. ALWAYS ADD THE VALUE.
Cheers,
Denis J.