4 Strategies to Effectively Price Services

4 STRATEGIES TO EFFECTIVELY PRICE SERVICES FOR SMALL BUSINESSES

How should I present my services to new clients?

There’s one thing I know for sure—trying to figure out how to price products and services is tough. You need to look at your competition, determine what the market will bear, and find that sweet spot where you can still charge premium prices and feel valued.

I know I’ve wracked my brain on this topic, and so have dozens of my clients! I’ve learned that packaging your services around the value you bring rather than time is directly related to greater profits and revenue.

So, how do you “package your value”?

Here are four effective strategies to help you do just that:

1. Turn Your Services into a Product

This is another way of saying, “Turn intangibles into tangibles.” Make your services “on the shelf” ready to be picked up and purchased just like a product. Too often, service-based businesses fall into the trap of itemizing what they provide. Instead, package your services in a way that makes them tangible and easy to understand.

2. Break Each Stage of Your Service into Deliverables

Give each step a branded name with perceived value. This approach not only clarifies what clients are getting at each stage but also makes it easier for them to understand the benefits and results of your service. By breaking down your service into a series of deliverables, you create a clear path your clients can follow, which builds trust and confidence in your offerings.

3. Start Using Price Anchoring

Price anchoring gives people a frame of reference for valuing your product. Show the full price next to the discounted price, and stack three “versions” of your product side by side (with a value for each and what’s included). This strategy will guide customers to choose the product you want them to choose. Price anchoring helps customers see the relative value of your offerings and makes it easier for them to make a decision.

4. Create Different Price Packages

Value package your products and services for different budgets and offer your clients options. Providing a low-cost version of your product and then ranging to a more comprehensive package will help you avoid giving away your time for free.

A value package allows you to cater to different segments of your market, providing a range of options that suit various budgets and needs. This not only increases your potential customer base but also encourages upselling your services to higher-tier packages.

Final Thoughts

Once you’ve created these packages, remember to showcase them prominently. Display them on your website, include them in emails, and feature them in your offer letters. Consistently highlighting your packages will ensure that potential clients are aware of the value you provide and the options available to them.

By implementing these strategies, you can package your services in a way that highlights their value, making it easier for clients to understand and appreciate what you offer. This, in turn, will help you command premium prices to grow your business.

6 Tips for Boosting Sales

There comes a point in every quarter when businesses face an “oh-boy” moment as they review their sales numbers.

Sometimes, this moment brings a sigh of relief, but more often than not, it induces panic and fear due to underwhelming figures. This is when the marketing and business development teams are tasked with generating additional clients and sales. Having experienced this scenario many times, here are six proven strategies to boost your sales effectively.

1. Offer Seasonal Promotions

Seasonal promotions can be a powerful tool to attract clients during peak times of the year. Whether it’s a holiday sale, a back-to-school discount, or an end-of-financial-year offer, these promotions can significantly boost interest and drive sales without permanently lowering your regular pricing structure. Regardless of your business type, you can tie promotions to specific times of the year and create a sense of urgency by offering a 10-20% discount for new clients.

2. Bundle Your Services

Offering bundled services at a slightly reduced rate can encourage higher sales volumes. Bundling services makes your offerings appear more valuable while providing clients with a comprehensive solution that meets multiple needs. Ensure the bundled price is appealing yet profitable. Promote these bundled services to your best clients as an incentive to try new offerings, including services they haven’t experienced yet.

3. Utilize Tiered Pricing

Tiered pricing allows you to cater to various client segments by offering different levels of service. Clearly outline what each tier includes and the benefits to the client. For example, a “Basic” tier might offer essential services, while a “Premium” tier could include additional support and advanced features. This strategy helps attract new clients at the lower tier and potentially upsell them to higher tiers as they recognize the value of your services.

4. Offer a Money-Back Guarantee

If feasible, consider offering a money-back guarantee to reduce the risk perception for potential clients. This is particularly effective in competitive markets where clients may hesitate to invest without seeing immediate results. A guarantee demonstrates confidence in your services and can improve conversion rates. Specify the guarantee’s applicability, such as limiting it to one of your “Basic” packages or new clients only.

5. Revisit Lost RFPs/Sales from the Past Two Years

Revisiting lost opportunities from the past two years can present an easy way to reengage with relationships that have already been established. Determine if these prospects are content with their current providers. Often, “buyer’s remorse” can lead to opportunities for you to offer better solutions or engage in new projects. Never consider a lost sale as a failure; instead, view it as a future opportunity.

6. Leverage Testimonials and Case Studies

Showcasing testimonials and case studies can significantly bolster your sales efforts. Launch a campaign highlighting success stories from satisfied clients, providing tangible evidence of your services’ value. Include specific outcomes and metrics to give potential clients a clear understanding of the benefits they can expect. For example, a case study demonstrating a client’s 30% revenue increase after upgrading to a higher service tier can be incredibly persuasive. This approach validates your pricing, builds trust, and makes it easier for clients to justify their investment.

Final Thoughts

Incorporating these sales strategies can help boost your sales and build a framework for long-term profitability. Effective sales and marketing programs require ongoing adjustments based on market feedback, but with the right approach, you can achieve sustainable business growth.