Let’s look at a story that’s more common than you’d think: someone quits their job, and decides to start a company. They work hard and have been growing—albeit slowly—for 15 years.
When the business first started, they didn’t know how to sell, but they knew they had a good product. They were confident in it, so they charged what was believed to be fair—and still got turned down.
Now, everyone knows rejection is a normal part of business at any level. This business owner “burned the ships” and knew the importance of turning a vision into a reality, so they kept at it. But, eventually, reality kicked in. It wasn’t long before debts became impossible to ignore, and the bills could no longer be pushed off—something had to change.
Even though they were kind and approachable, they were usually shrugged off; clients didn’t want to waste any time explaining what was potentially wrong. Eventually, a client was honest:
“Look, I can’t justify this investment. It’s just not worth what you’re asking me to pay! You haven’t shown me any reason why I should pay this much—why should I care?”
Ding! A revelation.
All great sales begin on the back of strong communication. Communication begins with a deep understanding of what problem your client is working to solve, and how your product or service fits into the solution.
They turned their approach around and focused on relationships, and it sent them down the path to conquering their industry.
This revelation was a turning point for our hypothetical business owner. They immediately shifted their focus from developing relationships only to make sales, to now making sales through powerfully vested relationships.
If you’ve been engaging with my content for any period of time, there’s one thing you’ve probably picked up on; I fundamentally believe that “a transaction is a byproduct of a vested relationship, and not the goal of a relationship.”
Simply put, relationships are the most important part of any sale—and they can always be improved. The relationship you and your clients share will have a huge impact on the trajectory of your business over time.
Creating a perfect client relationship is not always an easy task. When people know you have something to sell, walls naturally go up.
Bringing those walls down to produce a sale, while simultaneously adding value to the relationship takes persistence, knowledge, and patience in your response. So, if you’re headed towards a sale, you might as well get paid what you’re worth. Decades of experience or not, you deserve to get paid.
Perhaps you’re new to the “sales game,” and you’re thinking, “how should I price my products or services?”
There are two simple answers to this question: one, ensure you are up to date on industry standards and norms in your market. While you might be building a premium brand, it’s always a good idea to understand where your pricing structure sits among the competition. I wish I had some complicated structure for gathering and graphing this data, but the answer is elementary: Google. Take some time to do your research, so you’re aware of where you stand.
Two, gather data every single time you win or lose a sale. This was one of the most important practices I implemented when I was starting out; I knew the exact reasons clients wanted to—or didn’t want to—work with me. “Your market worth is what a buyer is willing to pay” is common knowledge among sales professionals. Ensure you’re collecting this data.
Years ago I started a practice called “ideal VS reality.” In a nutshell, I sit down with a pen and sheet of paper, and draw a line through the middle. At the top of the left column, I write boldly, “IDEAL.” In the right column, I write “REALITY.” Down the page, I categorize headings in the 5 areas that complete a whole person:
There is no particular hierarchy to this list, but you have to start somewhere. Then I begin: in the “IDEAL” column, I write down my ideal life in those 5 areas, (the life I am striving to achieve). Relationally, how do I want to be spending time with my wife? Under personal, am I working out? If so, where? In my finances, what should my accounts look like? How is that money generated? Etc.
In the right column, under “REALITY” I take these same 5 areas and break down where I’m currently at. Let’s say you want to be making $2.5M/year passively from investment accounts. That’s a great goal! But your “reality” is that you don’t even have a single investment account. We’ll talk about what that means. Perhaps you want to be working out every single day—and you’re doing this! Congratulations, you have an “ideal VS reality” match!”
When both lists are done, my first reflection is on where there are connections; what am I doing well? My second reflection is on where there is a disconnect: what have I not yet accomplished? For the things I still have left to accomplish, I start to break down steps. For example, if you want to be working out at Equinox instead of your local YMCA, that’s going to run you a few hundred per month. You like flying private? Fancy, fancy. That privilege also costs money. You want to take the family on vacation twice per year? (You see where I’m going with this?)
Base your pricing structure and business strategy around the life you’re striving for. Now this doesn’t mean that you price yourself 10,000X higher than your market standards—rarely is that ever perceived well. But, you begin to analyze your goals based on what you wish to accomplish. With this practice, you’ll know what you need to take home after taxes, to comfortably move the needle towards the life you want, and away from the life you might have defaulted to.
Now, the easy part is doing the math; if you want to step up your prices, you must first step up your game. The more you learn about handling objections, relationships, and your profession, the easier it will be to prove you’re worth it. That’s why it’s time to start now.
So, how do you prove you’re worth it?
Simple to understand, more complicated in execution. “Creating value” for your clients is a moving target—it changes from year to year based on market conditions, your professional acumen, etc.
Start by identifying pain points and how you solve your clients’ problems.
These two areas are your largest barriers to overcoming that next level of compensation. I often say, “if you can’t clearly define how you bring value to your clients, then your client’s can’t either.”
A great way to discover how you bring value is to ask. “[Client], what specifically about our relationship would you consider to be the most valuable?” As an example. The other is to continue developing your personal and professional skill set, so you have confidence in your abilities. The reason I am able to hop on a phone completely cold and master any objections that are hurled my way, is because I have spent years of my life practicing, training, rehearsing, learning, and repeating. Client’s didn’t tell me that “my ability to master objections was the most valuable to our relationship,” but I was confident in that skill through my own training.
Clients have to know why they should care, and how specifically you bring value as a professional before those walls can come down. If that isn’t clear, they won’t pay.
In my last post about handling the “it’s too expensive” objection, I discussed taking responsibility for your pricing and overcoming that objection. If a client sees you backing off, it could alert them that something else might be wrong in you, your product, or your pitch.
If you’re having trouble determining your worth or building demand in your marketplace, you should join Obsessed Academy and put together a game plan to get you back on top.
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