Many people I talk with are under the impression if they only knew the right price, they would be doing so much better than they are. This belief in a magic price makes us feel good – just like Santa Claus makes us feel good. However, I have to let you in on something: both are fairy tales. Sadly.
A Price Itself Doesn’t Create Value
You create value with your products, your services, and your marketing; a price itself won’t magically create value customers flock to buy. In a few circumstances, price can add a little bit to your perceived value, but not a ‘Santa Claus’ amount. A magic price just doesn’t exist. Sorry.
So why should you care about pricing at all? Because it is amazingly profitable. In fact, a small improvement in pricing can produce a large increase in profit.
So, what can you do with this information? First, admit your hope in a ‘magic price’ needed to make you successful. Next, repeat after me: “there is no Santa Claus, and there is no magic price”. Now, it’s time to roll up your sleeves and work hard on your pricing. This work in the real world will produce phenomenal – and importantly, real – results for your business.
Tags: pricing skills, value-based pricing