Your prices
I’ve been sharing with you the top mistakes I see service providers making when trying to sell their programs and services.
Today, we are covering Mistake #2: Focusing on a lower priced offer.
Almost every coach, consultant, or service provider I speak with talks to me about the lower priced program they are going to launch to serve the people who cannot afford their high priced offers.
That is a mistake.
Reason #1: EVERY new offer you create affects all 4 of the Time Management Quadrants that I speak about with entrepreneurs:
1) Admin,
2) Service Delivery,
3) Sales, and most critically
4) Marketing.
That means you are diverting a substantial amount of time and resources to something that will require large volumes of people to make profitable.
This does not make sense, unless you are already making $500K – $1M from your high-end offer.
Instead, you should be focusing on selling MORE of your highest-end offer or introducing an even HIGHER priced option.
Reason #2: It is harder to hit your revenue goal.
- Number of new clients needed.
Determine how much money you want to add to your bottom line each month.
Most business owners I know would love to make an extra $20K this month.
So, if you want to add $20K, and let’s say you add an offer that is $300, then you need 67 new clients. That generally means you need to create a webinar or some conversion mechanism and have about 1,200 prospects watch it. Which means you need to market to 14,400 prospects.
That’s how the stats generally play out, (assuming you have market average conversion rates throughout your marketing funnel).
It takes a whole lot more effort to convert masses vs. focusing on few.
$20K per month, with a high-end offer of $10k means you only need 2 new clients this month.
Converting 2 at $10K is easier than converting 67 at $300. Trust me.
- Size of your list and/or your following.
If you do not already have a substantial social media following (10,000+) or a large email database (10,000+), then it is going to take time and money to build that list up.
That generally means you need to introduce a NEW marketing campaign to market your new offer. Your team’s focus is then diverted from your main high-end offer. Instead, your/their focus should be on fine tuning your marketing to attract more prospects who are willing to pay premium (this is a function of targeting and a marketing message).
