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Indelible Concepts Newsletter #2
Happy Thursday,
If no one complains about your price, it's too low.
A complete lack of pushback can indicate that your price is below perceived value. This might be good for short-term sales, but does it position your brand for long-term success? A little resistance can signal that you're hitting the right value proposition.
Customers are weighing the price against the perceived benefit. Therefore, you must create strong brand messaging that communicates value so they understand why your price is justified.
PRICING PLAYBOOK
Crafting Your Pricing Strategy:
1- Know Your Customer and Their Value Drivers:
- Conduct thorough market research to understand your target audience's needs, pain points, and buying behaviors. What are they willing to pay for solutions like yours?
- Identify different customer segments within your target audience. Each segment might have different value drivers and price sensitivities. (Offer a free tier with basic content and paid tiers with increasing benefits.)
2 - Define Your Value Proposition:
- Benefits vs. Features: Instead of simply listing features, communicate the benefits your product/service is offering. How does it improve your customer's life or solve their problems?
- Unique Selling Proposition (USP): Identify what makes your offering unique and valuable compared to competitors. Why should a customer choose you over the rest?
3 - Craft Your Brand Messaging:
- Develop a compelling brand story: Tell the story behind your brand and how it connects to your customer's aspirations and values.
- Communicate Value Clearly: Use strong messaging across all touchpoints (website, marketing materials, sales interactions) to highlight the benefits and justify your pricing.
- Leverage Social Proof: Showcase customer testimonials, case studies, and awards to build trust and reinforce your value proposition.
Price Setting Tactics
Type of pricing:
- Cost-Plus Pricing: Consider your production costs, overhead, and desired profit margin to establish a baseline price.
- Value-Based Pricing: Analyze the perceived value your product/service delivers to your target customer and set a price that reflects that value.
- Competitive Pricing: Be aware of your competitor's pricing strategies but don't solely rely on them. Focus on your unique value proposition to justify your price point.
Pricing tier:
- Freemium Model: Offer a free tier with valuable content to build trust and showcase expertise.
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Tiered Subscriptions: Create multiple paid tiers with increasing value propositions. This caters to different budgets and needs. Examples:
- Basic Tier: Exclusive content, early access to free tier content.
- Pro Tier: In-depth analysis, downloadable templates, access to member community.
- Premium Tier: Personalized consultations, Q&A sessions, priority support.
- Value-Based Pricing: Price your tiers based on the perceived value each level delivers. Don't be afraid to charge a premium for exclusive content or access.
How to Communicate Your Value
- Highlight how your paid content helps subscribers achieve their goals or solve problems.
- Use subscriber feedback and surveys to understand the most valuable content and tailor pricing accordingly.
- Testimonials & Case Studies: Showcase success stories from paid subscribers to demonstrate the ROI of your service
Addressing Price Pushback:
- Anticipate Concerns: Identify potential price objections and proactively address them in your messaging.
- Free Trials & Money-Back Guarantees: Offer limited-time trials or guarantees to minimize risk for potential subscribers.
- Focus on Value, Not Price: When responding to complaints, reiterate the exclusive value proposition of the paid tier.
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Quote of the week: The biggest risk is not taking any risk. ~ Mark Zuckerberg
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