Listing Your Prices Does The Opposite of What You Think
Listing Your Prices Does The Opposite of What You Think
Take your prices off your services page now.
Start the conversation with your clients by first asking them their goals, their hopes, their budget, and then start to formulate your price.
In the Beginning, We Copy
Back in 2015, it was summer, I had just graduated college and I was deadset on running my new video production company, Valley Films. I was aimed to get whatever work I could - any project seemed good. Living near Charlottesville, VA which I learned was one of the leading wedding destinations on the east coast, I decided wedding videos were a great start to get some clients under my belt.
I did what many creatives new to business do, I totally copied what everyone in the wedding industry was doing. Photographers and videographers alike were breaking their services into wedding packages. It seemed like a good idea at the time and seemed very client-friendly.
Packages were set up like SAAS companies: Small, Medium, Large; Bronze, Silver, Gold. My packages were The Highlights, The Vignette, and The Love Story. And like everyone else, I listed my prices right underneath each package.
In my mind, this filter out potential clients who are only in it for the money - "price-shoppers." If I'm not in their budget, then there's no need to waste time on a call.
Looking back now, I realize how dangerous the tactic of listing your prices can be.
Listing Does The Opposite
Listing your prices on your websites, especially if you're in creative services, does the EXACT opposite of what you would hope. Your hope is that it will attract higher-paying clients and weed out the tire-kickers. By listing your prices to the world, you have given up any and all leverage with potential high-paying clients because you have no room to negotiate. You have anchored your prices before you even find out a client's budget, expectations or risk they're undertaking by hiring you.
If your clients have a budget of $15,000 for your services, and you're charging $5,000 because you've publically listed that, then you have missed a huge opportunity for profit.
And by listing the prices publically, you will never attract the super-luxury spenders because your price will seem too low for the risk they'd be taking on you. Back to the wedding example, if a couple had $40,000 from Dad to hire a wedding photographer, and they only spent $1,000, then the couple holds all of the risk. They are risking that this photographer is going to do a good job for only $1,000. If the photographer misses the 1st Kiss, who does the couple have to blame? They could've hired the best.
The other side effect of listing your prices is that it will indeed attract the price-shoppers. Prioritizing your prices before you communicate your value means that the conversation with your prospective client will circle the drain, bringing your price lower and lower. People stop hiring your company for you and the value you bring and instead, they will start shopping around comparing your prices to your competitors.
Welcome to Commodity Land!
Now, of course, those who can't talk about money, don't make it, but when you Sharpie your price to your forehead, it's hard to focus on anything else.
Take your prices off your services page now. Start the conversation with your clients by first asking them their goals, their hopes, their budget, and then start to formulate your price.
- Jordan P. Anderson
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