I help entrepreneurs leapfrog over the typical potholes that derail most small businesses with inspiration, motivation, education, and support across a wide range of business topics drawn from over a decade of running my own business, teaching entrepreneurship for the City of New York, and coaching and consulting privately with dozens of women and minority small business owners. Honestly, why go it alone when help is an email away?
Bridge the Gap
My friend Brian, who is an amazing creative director and designer, shared this story with me in response to my recent message on the framing effect.
And he has graciously allowed me to share it with you.
Many years ago, Brian and his partner, along with a couple of competitors, bid on a project.
Brian and his partner agonized over the pricing, because they really wanted to win the job. Ultimately, they decided to reduce their fee as much as possible, believing this would make their proposal especially attractive to the prospective client.
But, they lost the bid.
Brian had the opportunity to receive feedback from the client on their submission and she told him, "If you go to Barney's to buy a shirt, you want the $200 shirt, not the $100 shirt."
What she was saying is that she wasn't looking for the lowest bid (or cheapest shirt) or she probably wouldn't have invited his team to submit a proposal in the first place. She was looking for something special and she understood that would cost more.
She also told Brian that the low price of his proposal made her doubt that he and his team really understood the scope of her project, which was, perhaps, the biggest tragedy since her project was squarely in Brian's wheelhouse and her company was an ideal client for him.
In the end, what Brian saw as a competitive advantage in terms of pricing, his prospect saw as a cause for concern and a considerable drawback.
Brian freely admits "I suffer from over defending value and not losing clients to that mysterious knowledge gap."
Said another way, this is something I hear frequently: "My prospects just don't understand my value."
Well, if you can relate, here's the good news: This is a problem you can actually fix! Because the problem is yours not your prospects'.
The thing about marketing and sales that often doesn't get discussed is how much of it is concerned with educating audiences about:
- What they actually need versus what they think they need, and
- How valuable what they actually need really is versus what they think it's worth.
That education takes many forms: sales copy, testimonials, live and video demonstrations, webinars, case studies, portfolios, etc.
You need to have a variety of educational tools in your toolbox because not all audiences, offers, or opportunities are built the same.
But also because you are educating prospects over the entire course of the customer acquisition journey and not just at one specific point in the process.
As you can see from Brian's story, it's easy to make a small misjudgment around pricing and value that adds up to a significant loss. Many entrepreneurs don't even realize that they're doing this to themselves.
If you want to ensure your mindset is in line with your value and pricing and that you're educating your audience throughout the sales journey, book some time with me to talk it through.
FYI, I'm on vacay next week, so I'll see you on the other side.
PS - If you missed it, last week I was On a Mission.
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Easily Said & Done
I help entrepreneurs leapfrog over the typical potholes that derail most small businesses with inspiration, motivation, education, and support across a wide range of business topics drawn from over a decade of running my own business, teaching entrepreneurship for the City of New York, and coaching and consulting privately with dozens of women and minority small business owners. Honestly, why go it alone when help is an email away?
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