Why do we hesitate when thinking about premium pricing?
When your business was only a thought or a dream, what did it look like? Something that a lot of us business owners have in common is the time BEFORE we took the plunge. We were sitting at someone else’s desk, in someone else’s office, and making someone else, a lot, of money. We sit and dream about what it would be like to have something to call our own without limitations, stress, and without dealing with everyone else’s BS. My daydreaming never included 16 hour days, working weekends, and stretching myself even thinner than I was in my current life.
Why then is this the reality for so many entrepreneurs? How do we find ourselves in these situations where we end up sacrificing other aspects of our lives, sometimes including our own sanity and welfare?
One huge contributing factor to this less than desirable scenario is pricing! Especially at the beginning stages of entrepreneurship, we can really struggle to know how to price right. We tend to feel so lucky that we have customers or clients that we undervalue ourselves. Mix in imposter syndrome and the remanence of a pricing structure we all fell victim to in your standard 9-5, and we end up thinking that we are only worth a certain amount.
Undervaluing and underpricing your services will backfire in many ways and never lead you on the path of true financial success or freedom that I know you’re seeking and yearning for. I want to share with you 4 reasons why you should be charging premium pricing. Not next month, or next year, but NOW.
Premium Pricing Reason #1
You’ll Start to Attract Your Dream Clients
What is an ideal or dream client to you? It will be someone whose needs are fulfilled by your service, they are dedicated to the process and most of all understands your value. Those who are willing to make an investment are already super committed. They usually understand the value of the service and are already willing to pay that premium price. By showing your worth through your pricing, you’re going to attract the right type of clients.
Just like James Wedmore said, “The transformation is in the transaction”. This really says it all! Let’s use a real-life example; how committed would you be to the process or end result of a service you paid $100 for compared to one that you spent $1000 on? The latter will have you elbow deep every step of the way. You showed up, put your money where your mouth was and was dedicated to actualising results.
We need to also always remember that there are people out there who want a premium service for a low price tag. They will never value your expertise because they aren’t willing to pay for it. We don’t need to worry about those people or worry about missing out on their business. They aren’t your ideal client.
Premium Pricing Reason #2
You’ll Feel Valued and Show Confidence
Someone who shows that they are willing to pay premium pricing for your services is going to have such a positive knock-on effect on how you view yourself and your business. You are going to feel validated. It is one thing for you to KNOW you are delivering a super high-quality service, product or offer and your pricing reflects that, it’s another to have that confirmation from someone else. It can be really evident when a business isn’t confident about its pricing, so how can you expect a customer or client to be?
Undercharging will only show a lack of confidence in your own service, work and WORTH. Stand behind your premium pricing and believe in it. This will show prospective clients that you have that faith in what you do. Brands and businesses build reputations by proving credibility, trust and authority within their industries. There is no way of gaining any of that if you lack them in yourself.
Trust me, no one will want to buy from you if you don’t know your worth unless that prospect struggles with the same issue, which is why you’ll end up attracting clients that aren’t the right fit for you.
Premium Pricing Reason #3
Overworked Doesn’t Equal Reaching Revenue Goals
It’s common sense… undercharging will mean that you need more clients to meet any revenue goals. Why would you overwork yourself to reach that goal, rather than looking at your pricing strategy? Working harder doesn’t mean making more money. We need to unlearn that. This is something I go into more detail on in a recent post “Why Your Business Needs Pricing Strategy”
If you missed that post, you may also be unfamiliar with the Law of Diminishing Returns principle. Have you heard of it? Here’s a perfect definition by Brittanica:
“Diminishing returns, also called law of diminishing returns or principle of diminishing marginal productivity, economic law stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.”
So what does this mean? It has been proven that after you reach a certain point in anything such as working, you can continue to work, however, you will start to produce fewer and fewer results. This just shows that working harder DOESN’T equal success.
Premium Pricing Reason #4
Quality over quantity. Having premium pricing will allow you to offer an excellent and high-quality service to fewer people. Having 10-15 clients and working endlessly will not only lead to you feeling like a train wreck, but it will also affect the quality of your service. Those paying premium pricing will expect a certain standard of quality from you and maybe your undivided attention at times.
Providing a service to tons of people for a lower price WILL lead to burnout. I know this is a bit of a buzzword and something many coaches and industry professionals have capitalized on, but burnout is real! Make no mistake about it, you’re only one person and it will catch up with you.
Offering premium services with premium pricing will allow you to deliver excellence without the stress, overwhelm and feeling like you’ve stretched yourself far beyond your means.
Did this article resonate with you?
If this blog spoke right to you, then I’d like to invite you to check out my Masterclass. It has been designed just for you to help you reach your goals. If you’re sick of seeing no results, are feeling tired and overworked, or stuck in the mud, this is for you. Welcome in abundance and sign up!
Make sure to check out the Bulletproof Blog for tons more information and advice on topics such as financial freedom, attracting abundance, creating budgeting plans that work and so much more.
Hang out with me on Instagram! Feel free to DM me any questions you have about the Masterclass and ways I can support you.