No B.S. Price Strategy: The Ultimate No Holds Barred, Kick Butt, Take No Prisoner Guide to Profits, Power, and Prosperity by Dan S. Kennedy; Jason Marrs
Chia-Li Chien | Sept. 16, 2011
“Profits, in turn, absolutely determine the strength or weakness, power or vulnerability your business possesses,” says author Dan S. Kennedy in his book No B.S. Price Strategy. I’ve worked with many clients over the years, and have noticed that entrepreneurs play in two pricing zones. One is to declare a price war with competitors. The other is naming your price in a narrow niche with a subculture.
If you enter a price war, then you are in a competition for convenience. Make it convenient to buy from you—meaning you have to be prepared with volume if you want to protect your profit margin. If you are in the name your price zone, then you should be focused on providing the quality, aura and experience that your buyers want. No matter which pricing zone you’re currently in, it comes down to how much profit margin you, as an entrepreneur, want to protect.
The bottom line is that buyers, customers and/or clients are armed with the knowledge of where to get the goods and services they want, regardless of the economic condition. People are really smart and savvy when it comes to recognizing the right product for them.
Let’s not forget one thing; “price affects positioning and the kind of customers you attract” according to Kennedy. One of my major take aways from reading this book was the concept of five kinds of propositions and how to incorporate them into your business. They are: 1) Unique Selling Proposition (USP) 2) Unique Value Proposition (UVP) 3) Irresistible Offer 4) Unique Safety Proposition (USP) and 5) Unique Experience Proposition (UEP). The effective use of these five propositions can boost the conversion ratio and ultimately result in more revenue for your business.
The mechanics of presenting the five kinds of propositions is more of an art and effective use of human psychology. Understanding the psychology of buyers and yourself makes a huge difference in how you present your pricing to your buyers. Many of my clients who have effectively increased their price in the past not only sustained their desirable profit margin but also attracted better quality clients. It’s all in your mind.
Remember, the goal is not just to create an abundance of good, new business—it is to make your good business valuable!
Chia-Li Chien, CFP®, CRPC, PMP; helps entrepreneurs to creating business value that transforms their world. She is the author of Show Me The Money and columnist for WomenEntrepreneur.com & Fox Business online. She is available for consulting, speaking engagements and workshops. She can be reached at http://www.chialichien.com or firstname.lastname@example.org.