Google Partners Podcast -  Alex Langshur

Google Partners Podcast - Alex Langshur

If you are here it is because you heard Alex Langshur and me talking on the Google Partners podcast about products, value propositions and pricing!

If you are here it is because you heard Alex Langshur and me talking on the Google Partners podcast.

The conversation about pricing can be a dicey one. Not only because what businesses charge is proprietary, but also because methods of pricing can vary quite a bit. Some have buttoned down processes that track expenses, calculate hourly rates, and arrive at a margin. Others go mainly on instinct or observations of what other companies are doing.

But if marketers avoid looking closely at their pricing, do they run the risk of losing money? What are the gains of pricing more strategically? Pricing really comes down to two things:

  1. What’s your value to your clients, and
  2. How do you communicate that value?

To answer these questions, it can be very helpful to get an outsider’s perspective.

Our guest today is business coach Robin Waite. Robin has helped improve pricing structure, leverage value, and grow the bottom line for many businesses. Guest - Robin Waite, Business Coach From 2004 to 2014, Robin Waite ran a design and advertising agency that served more than 250 clients. During that time, he began delivering workshops and classes that helped more than 1,000 business owners improve their marketing, product architecture, pricing, websites and digital advertising.

As a business coach, Robin combines creativity with logical, analytical and objective thinking to help entrepreneurs become more successful. His best-selling books are Take Your Shot: How to Grow Your Business, Attract More Clients, and Make More Money and Online Business Startup: The Entrepreneur's Guide to Launching a Fast, Lean and Profitable Online Venture. When not coaching or writing, Robin loves nothing more than spending time with his wife and two young daughters.

Here's What We Discussed During the Podcast Interview

Pricing is one of the most important decisions you can make as a marketer. But most people don’t think about it strategically or systematically, and they end up leaving money on the table. In this post we'll look at how to assess and improve your pricing strategy so that you're getting what you deserve for your work.

How much should you charge?

In order to determine the right price for your product, you should first be asking yourself a few questions:

  • What is your target market willing to pay? You can find out by looking at similar products or services in the space and researching how much they charge. For example, if you sell a SaaS product aimed at small businesses with annual revenues of $1 million+, then it's likely that many of those businesses are willing to spend between $50-$150 per month on software solutions like yours. But if your target market is larger enterprises ($10M+), then they may be willing to spend more than double what smaller companies would pay (like $250/mo). Keep in mind that this isn't always true -- sometimes smaller companies have deeper pockets than bigger ones! In any case though...
  • What is your cost structure? The answer here will help inform how much profit margin needs to go into each sale before covering overhead costs such as salaries and office space rental fees -- not just now but also over time as those expenses increase due to inflationary pressures (or decrease due economic downturns). In addition, consider other business expenses such as marketing costs associated with acquiring new customers versus retaining existing ones; these factors all impact how much profit margin should go into each sale since different stages require different types of investments from both sides (seller vs buyer)

Why marketers avoid looking closely at their pricing

Pricing is a sensitive topic. It's also a difficult one to discuss with clients and colleagues. It's hard to get right, but even harder to get wrong.

So why do marketers avoid looking closely at their pricing?

What are the gains of pricing more strategically?

Pricing more strategically can help you increase revenue, decrease costs and improve client relationships. In fact, many marketers believe that pricing is one of their most important levers for growing profitability and delivering better customer experiences. Here are some of the gains we've seen:

What’s your value to your clients?

When it comes to pricing, the most important thing is to define your value. It's important that you know what makes you different from your competitors and how much of a difference it makes for clients. You should also be honest with yourself about how much time and effort go into creating the work that you do, as well as what kind of ROI (return on investment) clients receive from working with you in comparison to doing things themselves or hiring someone else.

You may have noticed that there are some common themes here: knowing your competition, knowing who your target market is and being able to define their needs accurately (so they can see how valuable what you offer is), understanding costs involved in producing content/services/etc., knowing what clients are willing to pay for said services/content/etc., etc., etc..

How do you communicate that value?

To get the most out of your pricing, you need to communicate the value that you provide. That can mean showcasing your work and success, showing off clients, highlighting the team that works with you or demonstrating expertise in specific areas. Or it could be something else entirely!

The point is that if someone knows what they're getting from working with you (and why), then they will be much more likely to pay for it.

What is the value of your product/service?

The value of your product or service is subjective and relative. This means that it's not a static number, but rather a sliding scale based on the needs and wants of your market, who they are buying from, and what they can afford.

It's important to know who you're selling to when setting pricing for marketers because the value of something will vary based on who that person is. For example: A $100 t-shirt might be worth more than 10 $10 t-shirts if someone really loves dogs and loves wearing dog-themed clothing (and let's be honest - who doesn't?).

Your job as a marketer is not only understanding how much people are willing to pay for your product or service but also knowing how much competitors charge for theirs so that you can stay competitive while still making money!

Who is your target market?

Now that you have a clear understanding of your problem and its solution, it's time to set goals.

Setting goals is an important step in the process for any marketing campaign. You need to know what you want before starting on a solution. If you don't have specific targets in mind, then how will you know if your marketing efforts were successful?

For example: If I said my goal was "I want people who visit my website to buy something," but didn't tell anyone else this was my goal--and then never checked back with them afterward--how would anyone know if I achieved success or not? They wouldn't!

The same goes for fitness: If someone says they want lose weight but doesn't specify how much weight or how long it'll take them, then there's no way for them (or anyone else) ever know whether or not they've been successful at reaching those goals!

When it comes to pricing, there are many factors to consider

Pricing is a complex issue. There are many factors to consider when pricing your products and services, including:

  • Strategic considerations: How do you want to position yourself in the market? What value do you want to deliver to customers? What kind of branding do you want for your business (e.g., high-end, luxury or value)?
  • Psychological issues: Pricing can be used as a way of signaling what kind of product or service it is (e.g., expensive = good quality). It can also affect how people perceive value in relation to other products or services in their mindsets (e.g., if someone buys something cheaply then they may not feel like it's worth very much). This means that even though one might think they're getting something good at an affordable price point, others may still view them as being ripped off because there wasn't enough research done beforehand before making such purchases."

Conclusion

Pricing is a complex process that requires careful consideration. As marketers, we know how important it is to be strategic in our approach and understand all of the variables at play. Pricing is an essential part of your business and one that shouldn't be overlooked when making decisions about marketing strategy or budgeting for planned campaigns.

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