said 1 year, 2 months ago:
Fascinating insight, Dawn. That may be something to keep in mind as you further target your market. Women planning with a budget, men jumping in without one. Security vs. exporation/adventure. As I look back at my clients/their budgets and what they actually paid me per job and their lifetime value as a client… I’d have to say men wanted the job at any price without flinching at any price I quoted. They were looking for results, and as quickly as possible. The fastest path to the cash for them was getting the thing they needed from me as quickly as possible so they could use that to make more money faster. Women clients always worked within budget, with nitpicky preconceived notions of what they wanted, most of the time that were ill fitted to bringing about the results they were seeking. The men got their “thing” quickly, used it, measured it, came back for more with different tweakings every time, used that, measured it, came back with more adjustments, used it, and so on. So their goal was always jump in, see what it takes to make the most money, improve their system, and do it again… making more money from their system each time. Women had their system preset in their minds, so they used me as a machine part, instead of as a racing mechanic that keeps improving the part to make the car go faster.
So over my career, I’d have to say it was more worthwhile NOT to quote a job up front, but to quote by the person’s needs that needed a new custom part for their sales racing engine. It didn’t take but a few years to understand that men were my market, not women. That men created the rising ceiling of the market and the push forward. Women created the rock bottom of the market, the price point that remained steady at which no one could buy service or product for a lower price. Men took the risk and the higher profits. Women took the safe road, the security, but had the most competition to deal with and inevitably had to keep lowering their price or cutting services offered to compete.
The difference was always the fear factor. Men get called to action and go on the offensive when afraid and go out hunting and scouting and staying on the move and looking for more ways to attack their nemesis, their competition. Women circle their wagons to fight and hold their ground, no matter how small a plot of ground that is.
I once charged $1,500 for a 10-page sales proposal I wrote to a man’s company who needed one quick. I continued to sell the same proposal to them over and over, tweaking that same template with maybe 15 minutes work each time. I did over 30 of them. Each one brought in $50,000 profit to them as my proposal presell the customer and all they had to do was show up to close the deal each time for no more than an hour. After the first one, I could have charged more, but didn’t. Looking back, however, I know they would have paid $5,000 for that first proposal without batting an eye.
My point here… in this industry there is a good reason to charge according to what the worth of a customer is to your client. A restaurant owner may struggle to pay your set rate and won’t call you because his perception of the value of one customer is lower than that of a roofer who stands to make thousands off one job. And the client whose customers pay him on a recurring basis? Well, over time his customers are worth even more than the roofers.
To charge the restaurant owner and the roofer and the recurring fee client the same thing is really a disservice to them, selling them all the exact same widget to run a beat up jalopy, a family van, and a million dollar classic car. If you’re thinking that the same part will fit all three, you may be right, but the clients who own the top two cars won’t want to do business with you because it appears you don’t understand the needs of their business.
In essence, you’re giving them a huge discount, they take your offer, then proceed to get you to provide the custom services they needed in the first place. When that happens, you are now giving deep discounts you can’t afford, so you raise your prices and no one likes it. That client, however, knows all this and will move on to the next contractor or company he can manipulate in the same way.
Bottom line, figure out what each type business is really worth. If you were working as a salesman for that company, what does he make? 15%? 25%? 40% on a sale? That’s what that company is willing to pay, dollar for dollar, to bring in new business. If you’re selling their business online for them, or creating the means for them to do so, charge what you are worth in terms of dollars generated for them. That really is your true value. Anything else is just discounting.
Man up, tee hee. Charge the big bucks that you cannot publish. But not because you’re hiding anything. It is the client’s value that is hidden from you. You can’t set a price for a figure you do not know yet. Those big buck companies are going to use you, no matter what you pay. Better to choose the ones who pay your real value.
If, on the other hand, you like selling widget parts, all the same for everyone and every client, then by all means put the same few price tags on all of them. That will mean you will get some really great clients with small budgets, a few great ones and a lot of headaches from the ones with average budgets, and you will never see one awesome client on the high end whose goal is not to nickel and dime you, unless you changed your widget pricing to a tailored one.
Just some thoughts and memories I had when I read this topic…. Nothing set in stone… just taking notice of some typical patterns over time… and thinking how I’d do things differently if I were starting out young today. I’d grab a spear and go run after dinosaurs with the guys, for sure!