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Valuing your products and services can feel like an abstract process. However, there are some key components of pricing and valuation that will shift the way you look at your offers — whether they’re product or service-based — and help you effectively put a value on your work that supports your overall brand strategy.
I am thrilled to share the mic with Sari De to dig into pricing advice that you can put into practice today. As a coach, Sari has worked with big name Fortune 100 companies, global ad agencies, even Google, to help women “navigate the system”.
The system we’re navigating in this episode is your pricing system, so let’s get started right now.
Meet Sari De
Sari is a migrant and the daughter of migrants, who grew up very poor. She recalled her fifth grade year as a challenging one — she was new to school, other kids were critical of the way she dressed, what she ate, and her accented English. As a kid, she wasn’t sure how to navigate the whole arena.
As an adult, she had a meteoric rise in her career. Sari is hardworking and driven and it resulted in promotions and working up to leadership positions within her company. But then she noticed that she was beginning to receive some harsh feedback. Colleagues called her aggressive. Her pay raises slowed, the promotions were fewer.
Nothing about her approach to her career and job had changed, except for the fact that she was now in a leadership position and that was threatening to those around her.
Knowing that, Sari committed to elevating the women and people of color in her workplace and others, educating and preparing them with the soft skills she knew they needed. Skills like negotiation and influence, the skills that would make all the difference in their own rise to success.
“I want women to have more power and more wealth,” Sari explained, “Because I think that power and wealth give us the most critical thing of all — influence. When we wield influence we can dismantle systems from the inside out. When we lead, when we get paid, we are able to influence change.”
Pricing Imposter Syndrome
When it comes to female entrepreneurs and the pricing challenge, Sari started off by reassuring everyone that imposter syndrome is rampant. Everyone faces imposter syndrome, and that can impact your pricing approach.
“Women tend to underprice,” Sari began, citing new research by Ohio State University that showed, “Women who ran their own service-based businesses from home earned $28 less per hour than their male counterparts.”
Sari told me that when she shares her rates with men, they’re unphased, but when she shares her rates with women they’re usually surprised by what she can “get away” with charging (those are big air quotes around get away!)
“I’m not getting away with anything. There’s no scam here. I charge what I’m worth because I’m really freaking good at what I do,” she confidently stated.
“Separate yourself from your work and stop conflating what you charge with what you’re worth, or what you think you’re worth,” she continued. “This is not about you. This is purely about the value of your work. Just like your doubts and fears don’t define your work, they shouldn’t define your earning potential.”
Downplaying & Environmental Factors
How do you present your business when someone asks about it? Do you say you have a “little” marketing agency? “Just” a “small” consultancy?
I’ve been there. It’s not unusual to feel uncomfortable with your success and in turn downplay all the things you’ve created and accomplished. “When we talk small it affects how others see us, but more importantly, it affects how we see ourselves.”
Repeating those things about your business over and over leads you to believe it, even when it’s not true.
A third factor that influences how we price our products and services is our environment. If we’re the richest person in our circle, that will influence how we view what we’re paid, but it doesn’t necessarily mean we’re getting paid what we deserve or what we’re worth.
Price is Part of Brand
Did you know that Chanel would rather burn their excess stock than offer it for sale at a lower, less premium price? It’s all part of their luxury branding strategy. You wouldn’t see Chanel as a luxury brand if you could get their bags for $10. Their pricing strategy allows them to position themselves at a high price point because their products are perceived to be worth it.
“The goal is not to have clients looking around for the cheapest offer, because there’s always going to be someone who is priced cheaper,” Sari explained. “The goal is to have clients who want your brand. Your unique thing, that you bring, that you found a way to make irresistible.”
Think of how Tiffany presents their stores and even packages their items once purchased. Their attention to a premium customer experience as a brand is reflected in their pricing. “What you charge should reflect the entire brand experience that you offer,” Sari stated.
Raising Your Rates
After listening to this episode, you might start looking at your suite of offers thinking that you’ve been under charging for the value you deliver. Time for a price hike, right?
Well, there’s a way to do it so you can still retain your valued clients and back up the change in price in a way that will keep them on your roster. First, be sure that you’re not just sending off an unexpected email with the price change news and no context.
Sari advises getting on the phone with your long-time clients and sharing how the market has changed, how your service has changed, or anything else that influenced the increase in price. Then, follow it up with what you’ll do to raise the level of value you provide for that increased rate.
“It doesn’t have to be more stuff. It could be an increased level of service, greater touch-points,” Sari shared.
5 Steps to Influencing Perception of Value
“We don’t necessarily get paid what we’re worth. We get paid what people think we’re worth,” Sari began. “And the good news is that we can influence what people think we’re worth by clearly communicating our value.”
The first step in influencing someone’s perception of value is to ask yourself what problem you solve for your client. For a coach, you’re not asking how much coaching is worth. You’re asking how much is it worth to gain the knowledge that you as a coach can deliver to a client that could impact the rest of their lives.
Second, communicate the value that you add.
Third, what is your unique skill set that makes you better qualified to serve your clients than someone else? This could look like sharing your personal story, your portfolio of work, your process, or some combination of these things. Sari explained, “Understanding what makes you different or extraordinarily placed to solve problems for your clients will ultimately be why they’re willing to pay your fee and not go with a lower priced offer.”
Fourth, it’s important to benchmark your prices against competitors just to understand what range you have to increase your prices.
And finally, ask an ideal client what they would pay for your clearly articulated offer. This process will help you price yourself while also indicating if you’ve clearly articulated your value properly because they should give you a price you’re happy with.
More from this Episode
What do hourly, project, and value based pricing look like? Which pricing structure is riskiest? And why should you always be tracking hourly rates? There is such a wealth of information on pricing and selling in this masterclass with Sari, so if you’ve ever questioned the worth or value of your products and services, hit play right now.
Be sure to connect with Sari De at @saridecoaching on Instagram, email@example.com, and at saridecoaching.com.