How to raise your prices without adding more work

0:00 Raise your price without adding more

Mike: In today's episode, we're going to be talking about how to extract more value from your offer without adding more deliverables. This is a common thing that I see in people that have business service companies. The mindset tends to be, if I'm going to make my price higher, I have to offer more things. And sometimes that's true. Sometimes a product is incomplete, or it doesn't have the right ability to create transformation for the customer.

But more often than not, what you do, or what that person is doing inside of their business, has the ability to create enough value even with three quarters of the delivery. What I want to challenge you to do today is restructure your mindset, take a step back and wipe the slate clean on what it is that you were doing in the past.

0:48 Why you don't need to be full service

Mike: Think about your product and your service offering from a bit of a different perspective. The conversation thread I have with a lot of my coaching clients goes something like this: "Well, my competitor charges this, and I don't have as much experience, so I have to charge this lower amount." Or they say, "Hey, if I just offer this one specific unique thing that I'm great at, and I don't give them everything before and I don't give them everything after, people aren't going to see the value and they're not going to buy. It needs to be full service. I need to do everything."

The reality is that if you are great at something and that thing creates a transformation for a customer, they will work with you. A big example of this within the marketing industry is people that own an agency. They think in their mind, "Well, we have to be full service, because if I'm going to run Google Ads, that means we need SEO, Facebook ads, build websites and funnels and all this other stuff."

The truth is, if you structure your pitch and put your offer together in the right way, people will see the value in your offer just as it is. In fact, the last 11 years of my marketing agency, we had a ton of people ask us, "Do you do Facebook? Social media content? Training on graphic design?" No, no, no and no. We do Google Ads. And if you need other things outside of Google Ads, great, there's other providers that can do it. But if you want someone who's excellent and is going to drive you results in Google Ads, I'm the person to talk to. And I built my entire company based on this.

So the goal of this podcast is simply to challenge you to think a little bit more outside of the box, and to provide you with some steps and tools that you can leverage to start thinking about your service in a more simple way and extract more value from it, so that you can be more profitable.

2:29 How a low price burns you out

Mike: The reason it's important is I see entrepreneurs and solopreneurs and small and big teams burn out constantly. They want everybody to say yes, so they lower their price, and they want to offer the most amazing thing for the best price possible. And so everybody says yes, because they've been sold this dream of "I can get this huge thing for this little price." But what ends up happening is, as you start to deliver this work, it's exhausting. It is so much more than you would bargain for.

You have to bring in expertise, because you're dealing with subject matters or technical things that you're not good at. And what happens is, the more time it takes for you to do, and the more softwares you need to bring in, the more contractors and outside experts you need to bring in, the more it cuts into the margin. And as that starts to happen, your motivation to work goes down.

So it's really important to be very confident in your offer, to extract the most revenue from that offer as possible while still giving the person the transformation that you promised, and ultimately to create a little bit more calm and tranquility in your business. The hope is that you come out of this with some more confidence that what you do is important and what you do creates tremendous value for somebody. Once you believe that, it becomes a lot easier to raise your price with confidence.

3:50 Step one: depth

Mike: Okay, so let's dive into the practical application. What are the three things that you need? What are the critical steps to be able to understand the value of what it is that you offer, and then change and reposition what you do, while also simplifying your deliverables?

The first step is diving deep into this person's mind. If you don't understand your customer at a very deep level, their fears, their concerns, their motivation, what is going to make them say yes and buy, everything that you say to them is going to come from a position of "this is what I want you to understand." In sales, it doesn't work that way. If the person doesn't feel like you understand their problem, their situation, their challenges, their motivations, their fears, they're not going to trust that you have a path for them forward.

4:35 The one, three, six and 12-month exercise

Mike: There's a bunch of different things that we do inside my coaching program, but the simplest one that you can do is imagine what happens to this person if the problem that they're coming to you to solve is not solved. Now, that seems simple enough, but as time goes on, as time progresses, the compounding effect of not solving this problem, it's often a shorter period of time than you think for that business to just not exist anymore. What I recommend is one month, three months, six months, 12 months, or you can do some version of that.

If they don't solve this problem within one month, what actually happens to them? It's kind of nagging at them, and they find it very annoying. They're still wasting a bunch of time on sales calls and meeting different companies that do what it is that they do. They don't really trust their judgment on it, so they're still reading a bunch of blogs and watching YouTube videos to try and understand deeper about the problem.

Maybe they're implementing things on their own inside of their business that are trying to solve the problem, but it's not their zone of genius, so it's wasting time. They don't really have an evaluation of it, and really they're just kind of feeling irritated, annoyed, feeling a little bit down. Okay, so that's after one month. But three months go by, and if all of those things stay true, nothing has improved, nothing's been fixed, no answers are there, what then starts to happen? And then six months, 12, maybe even 18 months.

And in some cases, by 12 months, if this problem isn't solved, the business is gone. So now we're getting into the profound depth. But usually at around the six-month mark, if a business challenge that you know needs to be solved isn't solved, the impact and the implication of that is pretty high. So I would encourage you to go through that process. That's a simple exercise to do, but you will unpack so much knowledge and so many personal fears and headaches and challenges that this person is facing, simply by exploring what would happen within that period of time if they don't solve the problem that you are helping them solve. So that covers phase one,

6:47 Step two: desire

Mike: which is depth. Now, what did you learn going into the depths of this person's mind? The second phase is showing the person that you understand them and creating a desire for them to, A, solve the problem, which they probably already have, but B, for you to be the one that solves their problem. Taking those most important points that really stood out in that first exercise, and then I incorporate those into my marketing, into my home page, my sales page, my landing page, into my marketing material, into my sales and discovery conversations.

It's not always in a statement format. Sometimes it's in a question format. So if you unpack something where you're like, "Wow, I bet you that all my customers face the same fear," maybe you ask it in the form of a question in your actual discovery.

What you'll find is, when you're asking great questions that are tailored to them, to their specific situation, and when you're providing statements or case studies or examples of how you have fixed it, or "I had someone that was here and now they're here," they can see themselves in this story, in this vision. They build this trust in you. You've now created desire for them to solve the problem, and for you to be the person who solves the problem for them.

8:03 Step three: direction

Mike: And then the third and final step is direction. A lot of people think when they're pitching, they need to give all the bells and whistles, like, "We're going to do this research, and then we're going to put the research into this, and we're going to write ads, and we're going to start the ad account, or we're going to optimize things." Most customers do not care about this, the little steps that need to be taken to make this problem go away, to create the transformation from one place to another. But what they do care about is the fact that you have a proven process.

The functional way of talking about this is, you don't want to list 30 line items and tasks that you're going to do to complete the thing. Package this up into a three, a four or a five step process. Each step of the process will answer how to get from the first one to the second one, and you're going to lead by expressing what they're going to get out of the step. Each one has to have an obvious transition, a door opening to the next step.

But showing them that you have a step-by-step process, showing them that you have something that you've designed that's helped other people just like them go from A to B, starts to take away the risk factor. It gives them the vision of, "Oh, cool, they already have a path forward. They already have a plan. They already have something that's going to get us here. We just need to get into their ecosystem and their flow, and we need to go through the process." Those are the three foundational steps that are going to help you elevate what you're talking about and give someone the belief in you as the person that's going to do it.

9:37 Cut the 30% that serves nobody

Mike: But we also want to talk a little bit about how we cut the deliverables down while still pricing high. So that comes in that phase four piece. If you take a step back and you look at all the things that you do within a customer ecosystem, you have to ask yourself, for every single task that's involved in what you're doing: who does this serve, and how does it serve them? Is it a task that we do internally that is going to make it easier for us to work with this client?

So maybe you have an onboarding sequence, and you've got a structure to how you do the research before you're getting them started, et cetera. So if it serves you by systematizing and making your life easy, great, we've now checked the box on where it's important and why. Just as much, if there is a task or deliverable that is going to make the experience or the transformation stronger for the person that's buying, big check mark. We want to include those, because they contribute to the transformation. They have big impact.

But what you're going to find, generally speaking, if you list out every single task one by one by one to get somebody a result, more often than not 30% of the things that you do are not serving anybody. They are deployed, they are implemented because you've seen them somewhere else, the company that you used to work for, the agency that you were working for before, whatever the case may be. You've looked at this from before and it said, "Oh, well, you know, this is how we do it," so you said, "Cool, I'm just going to take those processes and move them over to me."

So if you go through every single task and you can't answer that, if it doesn't serve and help you make your delivery easy, or if it doesn't work towards the transformation, or it's not something that makes the client like you more and want to stay longer, you need to kill it. And nobody's going to notice it's gone, because you get to make up what this process is.

Go through and get rid of the 30% of the fat in what it is that you're delivering, and leave the price as it is. That alone is going to increase your profitability, right? Less people, less bandwidth, less energy, less time goes in. You still transform them with the result, and then you make the same amount or more money.

11:49 An email marketer goes from $1,300 to $6,000 a month

Mike: One perfect example of this: I have a client who works in email marketing, and what he used to do was make a pitch where what he wanted was, "If I list all this crazy stuff I'm going to do, that's going to get the person excited, that's going to get the person to trust me and feel motivated to buy from me." And what happened was, they were selling email marketing services, list management, automations, sequences, three emails a week going out as the brand's voice, and they were charging $1,300 a month for this service.

And now he had a lot of customers. Everybody was saying yes, everybody was wildly happy, because the profitability was incredibly high when this is done right. This person happens to be a great email marketer. But what was happening when I first met him, before we started working together, he was ready to quit. He was ready to say, "I'm so burnt out. I want to spend time with my wife, I want to spend time with my three kids. I just don't have any energy, and running this business is creating a worse output for me."

And he was, I think, in his mind, never openly said it, but was kind of like, "I'm ready to just throw in the towel, because I've cornered myself into having 10 different jobs," and the motivation to keep going was almost gone at that point. So what we did was we took a step back. We unpacked and understood what the person actually needed from us to get a great result, and cut out everything else. Anything that wasn't serving our ability to work faster, easier and better, or creating a transformation or revenue result for the client, was immediately cut.

But what we also did is we took some time to look at the actual stats. How much more revenue is this creating for people? And what he was charging versus what he was producing was just an enormous gap, a 10x gap. And so when we understood that and looked at it in a more objective way, it was very easy for him to say, "I'm not charging enough money."

And so we reworked and restructured his offer, and the delivery was actually less items, but the price was four times the price. We brought it up to $6,000 a month as a retainer, and at that point it essentially just fit into where it should have been. He was actually just really far behind, and we just modernized it.

We also took into consideration what his steps are to prove to the person that he knows what he's doing, and we named them and gave them a brand and made them very appetizing. Now everybody that he talks to sees the vision, feels like they've got somebody who knows what they're doing, and he closes a very high percentage of his sales. This price is significantly higher

14:37 Free exercises and a workshop

Mike: than he was making before. And so if you're listening, and if you feel like, "Oh man, this was like a stake through the heart. I've just now had this discovery that I've got a problem with the value that I produce versus the price that I charge. My price is too low," there's a couple ways you can do this. I've got some free exercises. Feel free to send me a note on Instagram at @themikemoll, and I can send you a few exercises.

The other thing is that on November 15th and 16th, I'm going to be hosting a two-day workshop that's going to help you strip down every part of your offer, create this deeper understanding, and restructure and re-pitch your offer. It's going to be a two-day intensive, very small group, so everybody's going to get some personal time with me.

We're going to go through the series of exercises that I do with my private coaching clients to really understand how to package everything up, how to understand the customer, how to express the value, and how to put it into your marketing. We're going to cover all those things over a two-day workshop. And so if you want to join that, again, feel free to send me a note on Instagram at @themikemoll.

15:42 Summary: the three steps

Mike: In summary, the truth is what you're doing now is already holding more value than the price that you're charging. I've seen almost no instances of people where I've looked at their offer and looked at the transformation that they create and they're appropriately charging. Very seldom. So take a step back. Take some time to understand the customer. Understand the pain, the challenges. What happens if they don't solve this problem for a one, three, six and 12-month period? What happens to them personally, mentally, to the business? What is the compounding detrimental impact that not solving this problem is going to have? That's going to help you understand why what you do is more valuable.

And then we're going to take those most important things, and we are going to put that into our offer, put those highlights into our marketing, into the questions that we're going to ask these prospects, to make them feel understood, to get them to see how important this thing is.

And then you're going to create a three, four or five step process that's going to show them the vision of what it's going to do for them and take them through the flow, so they can see how the transformation is going to come together. And you're going to lead with all language that is outcome to them. Nobody cares what's in it for you. They care what's in it for them. So let's highlight that.

Just those three simple things will increase the value of your offer and will give you permission, mentally, to start lowering the amount of things that you're promising, lower the amount of deliverables. Because there's still a lot of deliverables in your toolbox, in your offer, in your current flow, that probably aren't serving anybody in a significant way and are probably just creating more friction, creating more time, energy, effort and profit loss in your current business. So, some things to think about. I hope this episode helped. Have a great day.