Women Entrepreneurs and Pricing

woman with cash

Isn’t it time that we women start to value our work?

Why do we assign low pricetags to our offerings?

It seems to me that after all the conversations about how unfair it is that men make more money for the same jobs as do women, that women entrepreneurs would show that they feel they deserve equal reimbursement.

And yet, females usually put lower prices on the products, services and programs that they offer.

Come on, ladies! Don’t put yourselves down!

As I mentioned in my recent article, Charge What You’re Worth! people don’t value things that they can have very inexpensively. They feel that you get what you pay for. Haven’t we heard that all our lives?

Don’t give your target market the opportunity to scorn the worth of what you offer.

One rationalization for charging low prices is that entrepreneurs think that they will make more sales if the cost is low.

That strategy tends to backfire in four ways:

woman counting her pennies1. Many potential clients will turn down your rock-bottom bargain because they assume that its quality is reflected by the cheapskate price tag.

Just as we are leery of “seconds” or “as is” labels on clothing in stores, we tend to be skeptical of the quality of bargain basement prices on business offerings.

2. You may sell more units but you don’t earn more.

If your program is worth $3000 and you sell it for $300, you have to make ten times as many sales at the lower price. Not easy to do if people turn up their noses at fire sales.

3. Low prices tend to attract the wrong customers.

People who are lured by bargains very often turn out to be a random group. They are not likely to be your ideal clients. After all, one of the traits of your perfect customers is that they value you and your offerings and are willing to pay accordingly.

4. If you recruit non-ideal clients, you will regret it later.

They don’t bring much energy to making use of your well-crafted products or services. Instead of participating eagerly in your programs, they complain. Just one person who whines can poison the whole group.

Your ideal clients aren’t looking for bargains. They are in search of solutions to their problems and they are willing to pay for them. If you can provide them with services or products or programs that can change their lives or their businesses, they will be eager to pay for them.

That’s why they are your ideal clients.

Happy businesswomanIf you reflect the great value of what you would like to sell them by assigning it the investment cost that it deserves, you are letting people know that it is worthwhile.

You must indicate the quality by pricing accordingly. People want to purchase top-of-the-line solutions.

Let them know that your can provide a premium product, service or program by charging a premium price.

Do you struggle with deciding what prices are appropriate for your offerings? Tell us your thoughts in the comments below.

 

 

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Comments

  1. Beth – I think you’ve got a real point here. I remember getting a questionnaire from a motel chain (Marriott, I think) that asked something like, “At what nightly rate would you feel unsafe when staying at a motel?” Just the way the question was worded drove home the point that we get what we pay for – and undervalue things that are cheap.

  2. I so agree, Beth! Perception is reality, and we value what we pay for oh-so-much more than something cheap. I can attest to this in my business. I started out charging very low rates, and slowly (my God, so slowly!) went up. Some folks are now shocked at what I charge, as you can get “editing” out there for very little money.
    You really do get what you pay for though 🙂

    • You’re right, Susan. Perception IS reality. I’m glad you have made the journey for honoring your value and charging what you deserve. Editing is such a good example of an area where it’s stupid to choose an editor by going with the low bidder.

  3. Great tips, Beth. I am still in the process of figuring out my new pricing model and have noticed that I am nervous about changing the pricing. I know deep down it is right for me, but I still am nervous about it. Is there any tips to get over the nervousness that potential clients will rejected the pricing?

    • Hi Sabrina. There are tips, yes. I plan to create a FB group on this topic and more where we can discuss and learn about these things. Stay tuned!

  4. We went thru this to determine the price of our jewelry. We see much lower prices on many Etsy sites and wonder how they can sell the material & labor so cheaply. Fortunately, there is a recommended formula for our product. The difference I learned is that hobbyists don’t charge for their labor/time.
    The issue we face is to run sales or not. We have decided to offer just a few, almost as a courtesy to our customers. And we keep testing. Good topic.

    • I think continuing to test is your best way to figure it out, Rox. You can’t try to compete with hobbyists. You don’t want to be too cheap or people won’t see your jewelry as being of value. But you already know that.

  5. I really do love finding bargains but I also know when I’m looking for something that really matters to me I go for the more expensive options as I believe you get what you pay for. All your points make so much sense, Beth, and especially the example of having to make more sales if you offer a program fo less than its worth.

    • Tamuria, Of course! We all love bargains. You know, marked-down clothes and books and stuff like that. With selling our best services, we don’t do ourselves a favor by going cheap.

  6. Based on all the ‘years’ I’ve been learning about what the market will bear when it comes to setting pricing, I still know that people want the best price they can get. Often if something is high priced, even if it is worth it, I will not buy it. I know myself well enough and guess I’m like many people, in that I have to weigh all the of factors and look at the big picture, before I spend money on high ticket items. Most products are not made for obsolescence. Information and knowledge is different. One area I do invest more in, is when buying theatre tickets. I love sitting close and will pay more for those seats. I know you are talking about products and services and I do think it depends on what it is. It is unlikely I would buy design services from someone on fivver, because how my branding looks, is very important to me. It’s an interesting conversation, Beth mand I know there are a lot of components to choosing what our ideal pricing is. And again each of us is very different and motivated by different things. Thanks for continuing this conversation with us all.

  7. This is a great topic and I love how you are addressing it. I think we sometimes forget how much money we have invested in our education, training, etc too. That is certainly part of the package they get when clients invest in me as their coach or my programs.. I learned a while ago that I must invest in myself too if I want others to and to remember there is an unseen energy within that attracts to us what we are.

  8. So, kind of like I was saying last week.. do I change my pricing.. and how would you suggest I do it?

  9. Hi Beth,
    As women, I do agree that we do not benefit like the men, but in having an online business, we can make as much or MORE, depending on how much work we put in and how much of our products or services people want. It all comes down to working “smarter” and knowing that we are indeed worth the price we charge 🙂

    You are right though, if our prices are too low, we do not get the kind of people that we want in our businesses because they are not motivated enough to do anything! Belief in what we offer is worth the price we ask, is most important 🙂

    Believing we are worth it is what makes us stand out.

    Thanks for sharing!! Awesome post!

  10. I think there is also a component of how we perceive how we value ourselves even before we get to the pricing issue. If we don’t value our self-worth, it’s harder to place a true value on what we create. I think Beth you have opened the door for a new professional opportunity. Knowing there is a place when someone would evaluate your product/service and help you price it would be a service think a lot of people would be willing to pay for.

  11. Well said! I think we need to be cautious of our wording…as you say, you don’t want cheapskates coming to us for great deals. So definitely don’t say “bargain” or “affordable.” A couple of other points: (1) Be sure you are actually selling what people want to buy, not what you want to offer. This is a problem that stems from swallowing whole the notion that if we are passionate about our business, the business will flow in all by itself. It will not. (2) People will pay more to get exactly what they want. I think we all have examples of things we pay a premium for because it is exactly what we want.

  12. Beth,
    I think this is an extremely interesting topic. When I became a “freelance” tennis coach, I battled with myself on what to charge. Some men in my area charge $1/minute, some charge significantly less. It was hard! I have found, though, that I am no longer willing to waste my time when a “potential” client wants to squabble over price. I even offer other coaches who are less expensive, if that is the path she wishes to take. I may be shooting myself in the foot, but I have found that I am much happier with the clients who decide my price is reasonable. Thank you for this! 🙂

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