Ep 041: Still Not Sure What to Charge?Dec 03, 2020
You know I’m all about creating a business that gives you the freedom and the lifestyle that you’re trying to create. So that’s exactly where we’re going to start. I want you guys to get really clear right here on the lifestyle that you want from this business. And that goes two ways. The first thing I want you to think is about the amount of income you need to be making from this business to live the lifestyle that you’re aiming for. Now, if you want to make a million dollars, that is totally, totally awesome. But is it necessarily a great idea to start with that big number in mind? Absolutely, but I would start with a benchmark goal. So a smaller goal that you can hit quickly and then you’ll scale from there because a lot of times people, especially when they’re just getting started, aren’t ready for a type of business a million-dollar business, because with that comes millions of dollars worth of headaches, right?
If a million dollars is your end goal, absolutely keep that in mind, but let’s shoot for a benchmark goal that we can hit quickly and then scale from there. So let’s say your goal right now is to have a business where you’re earning $10,000 a month. That sounds like it would be really beneficial to your family and your lifestyle. And maybe with that money, you’d be able to take this side hustle and make it your full-time thing. So let’s say $10,000 is the number that you believe you need to hit. . But on the other side of that, $10,000 is the amount of time that you want to spend on this business. Now it’s important for you to understand that you did not create this business to be another job for you.
In the beginning, it might seem like a job because there is a lot of work that you physically have to put into this business to grow it. Eventually, you want to kind of dial that back and you want to be able to create more of a lifestyle business where you’re not fully in it. You want to be focused on your business, on the growing and scaling aspect to get you to that benchmark that you eventually want to hit. But I really want you guys to think about the time that you want to start spending on your business to hit that $10,000 goal or hit that money goal that you can start with. . And so between those two aspects, the time involved in the money you want to make per month, now we need to think about your offer that you have.
So I know you have an offer right now that you’re struggling to price or that you’re struggling to come up with what you should charge your ideal client. So what we’re going to do is take out a pen and paper or, or do it mentally in your head if you’re driving. So if you have the $10,000, I want you to write down your goal. If that’s 10,000, go ahead and write at the top of the paper. Then I want you to think about the offer that you have and write it down. So for example, you’ll write down your course and then besides your offer, I want you to tell me how long it takes for you to fulfill that offer. So let’s say that you have a course and you’ve already filmed it, so it’s done, but you could say that each time you sell a course, it might take you 30 minutes to engage with the person, get them onboarded, and just make sure that there are no problems with fulfillment. Now I want you to think about the amount of time that it would take for you to go out there and get people to sign up for that course or go into your free lead magnet, and lead them to the course. I want you to think about the amount of time that it takes one person to sign up for your course. That could be two hours of you just really, really, really trying to get 20 people in your free lead magnet where one person purchases. The purpose of what we’re doing right here is we’re figuring out how much time is going to take for you to get one person into your course. Because what we’re doing is we’re figuring out how much time you want to work per week, how much time it takes to sell one course.
Then what we’re going to do is take that goal, that $10,000 goal, divide it by how many people you basically need to get into your course, and figure out the amount that we need to charge for it. Now, obviously more things will go into this, like, what’s your competition doing? But in reality, that’s not the biggest thing. I mean, yes, you want to be competitive in the marketplace, but you can also charge a premium if you need to. And you could add bonuses if you need to, in order to make you hit your income goal and work for the amount of time that you would like to work. So let’s say my income goal is $10,000 for the month and my course is something that’s going to take me like 30 minutes to onboard somebody. And I want to spend, let’s just say five hours a week, engaging in Facebook groups and engaging online and getting my ideal client to check out my course.
Now working from there, I came up with the number $997 for my course. And the reason for that is because I’ll only need 10-course sales per month. That’s it. 10 sales per month, two and a half per week. So if I hit two this week, hit three next week, and hit two the next, that’s fine. Can I hit two sales per week and then make up for it with an extra the next week? How feasible does that sound so much simpler than I’m going to try to make $10,000 a month? And I have no idea what to price my offer. No, I know exactly what to price my offer because I know how much time I want to spend on lead generation. Then I know that my course is already created and I don’t have to spend any time with these people.
So in reality, I could have a hundred people sign up for my course this month, I could have 500 people signed up for my course this month. And I really don’t have to spend that much extra time with them because I’m already done with my hard part, which is creating the course. But if you are somebody out there who has more of a done with your program or a program where you’re actually coaching them or putting in the work for them, or maybe you’re a virtual assistant, If you don’t have a do it yourself, offer which that’s what a course is. It’s do it yourself. You film at once and then they do it on their own. If you have more of a service offer you still need to think about this the same exact way. So I’m going to go through this if I was to say a virtual assistant.
I don’t like charging hourly for things, even if you’re service-based, I don’t think you should charge hourly because that’s always going to be, you exchanging your time for money. And let’s say you start to get really good at the tasks that you’re doing. It’s going to take you less in less time when the person hiring you. It might take them three hours to accomplish this task. So they’re expecting to pay you for three hours. Well, if you’re really good at it, it might only take you 40 minutes. So you just lost over two hours' worth of pay because you’re good at what you do. And I don’t think you should be punished for being good at what you do by losing money. Right? I think you should be paid a premium because you’re actually better at what you do. So that being said, if you are doing something hourly right now, I don’t think you should be doing that anymore. Granted, I don’t know your business. So if that’s working for you totally fine, but I like to advise you to consider changing what you do.
I’m sure you guys have also heard of a webinar, the same thing there. It’s just not as easy to warm up people in a webinar because that’s only an hour-ish depending on what you want to do, but a webinar could also sell you, do it yourself offer. But a lot of times than in that do it yourself, offer as a course. That’s where you could say, Hey, you know what? If you want further guidance if you want more, one-on-one help from me. I can work with you. I offer a coaching session. I offer mentorship and that’s where you push them into your higher ticket, offers more of a done with you and done for you solution. So basically what I’m talking about creating right now is a value ladder. And I’m kind of talking to you about how you can implement it.
But going deeper than that, the whole purpose of this episode is your pricing. But I want you to think from the perspective of time and money and it leads to your ideal lifestyle. And by having these three tiers of offers done with you, done for you, and do it yourself, you’re going to make sure that you’re hitting all of these different, not only price points for people. Because there’s going to be some people who are willing to spend $5,000 with you. They’re going to be some people who aren’t even willing to spend $5 with you. So by having these different offers in place that require less of your time for less money, more of your time for more money, you are going to tap into not only more of your ideal clients in where they’re at in their lives right now, but you’re going to make sure that it’s aligning with you in exactly what you should be doing.
But the main thing you guys with pricing, don’t be scared to charge a premium. Don’t be scared to ask for money. You’ll be doing somebody a disservice. If you don’t charge enough for your services and think about it this way. Let’s think about a diamond ring. All right. If you’re at the store and you see a ring and you’re like, oh my gosh, it looks so beautiful and so expensive. And there are two rings right next to each other. One of them is $50 and the other one is $350. There is a time in your life that you have not bought something because you thought it was too cheap. I’ll give you a personal example. Like two days ago I was on Amazon looking for an ocean kayak. One was a hundred dollars and I was like, there’s no way that a hundred dollars kayak is going to put up with these Maui waves. All right, no way. I’m going to sink and drown in the ocean. And so I clicked on one that was $500. And that all automatically made me feel better about purchasing it because there was just such a discrepancy in price. So often people undercut what they’re valued at and what they’re worth. And at the end of the day, if you guys put the system in place where you work backward, work backward from your ideal lifestyle, work backward from the amount that you want to make. Not only is it going to make your life easier, but you’re really just going to understand where you should be focusing your energy. And for me, if that’s to hit 10 K months on my new course, I need to sell 10 a month. Boom. That’s so much easier than you have to try to figure out, Oh my gosh, how much do I charge for this?
But if I could give you one key takeaway here, it is price based on your ideal lifestyle price, based on the amount of time that it’s going to take you to fulfill these orders and figure out how many orders you need, to fulfill in order to hit your monthly income goal. Basically working backward. If you have any questions, don’t hesitate to reach out to me and you can email me at [email protected] . I offer free discovery call sessions, where we could work a little bit of strategy, and then I could let you know how I can further help you in your business. So if you’re interested in lining something like that up, go ahead and shoot me an email.
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