Magical Princess Selling

BELIEVE IN FAIRY TALES?

Your price isn’t too high; your value is too low.

“Price is what you pay. Value is what you get.” – Warren Buffett

When your value is lower than your price, regardless of what you’re selling (e.g. roof, appointment, first date, etc.), your deal is dead.

Everything in life has a price!

Quick Summary

  1. Price vs. Value Dichotomy: The article starts with a powerful assertion that the issue isn’t that the price is too high, but rather that the perceived value is too low. This sets the stage for understanding the customer’s perspective on value versus cost.
  2. Universal Application of Price and Value: The concept of price and value is applied universally, from business transactions to personal time investment. Everything has a price, and the decision to engage is based on perceived value.
  3. Symptoms of Low Perceived Value: Several scenarios are outlined where the value is not seen as equating to or exceeding the price, such as lack of sales, appointments, or opportunities. These are symptoms of a value proposition that doesn’t match the asking price.
  4. Strategic Focus on Value Enhancement: The primary strategy for improving sales is identified as increasing one’s value, rather than lowering prices. Competing on price is depicted as a race to the bottom, which is neither sustainable nor profitable.
  5. The Inevitability of Cheaper Alternatives: It’s acknowledged that there will always be cheaper options available, emphasizing that competing on price alone is a losing battle because someone can always undercut.
  6. Misalignment of Value Perception: Examples are given where a business might believe its value is obvious, yet the customer values something else entirely. This misalignment is what causes lost sales opportunities.
  7. Debunking Qualitative Superiority as Sole Value: The article challenges the notion that qualitative superiority (being licensed, certified, etc.) automatically equates to higher perceived value. It underscores that what the business perceives as valuable might not align with the customer’s priorities.
  8. The Fairy Tale Syndrome: Businesses often live in a “fairy tale,” believing customers should naturally choose them. The article debunks this, emphasizing that value perception drives customer choices, not the business’s belief in its superiority.
  9. The Reality of Value Perception: A reality check is presented, highlighting that if a business’s value truly exceeds its price, customers will naturally gravitate towards it. The absence of this attraction is a sign of a mismatch between real and perceived value.
  10. Money Follows Value: The closing thought reinforces that money isn’t spent based on price but based on perceived value. The implication is that businesses should focus on enhancing and communicating value to attract and retain customers.

The time it took me to write this article, and the time it takes you to read it, both have a price.

We could’ve both been doing something different with ourselves, but we chose to invest in each other because the value is greater than the price. You’ll read this article all the way until the end because you believe you’ll find tremendous value here.

VALUE IS GREATER THAN PRICE

If you aren’t making sales, your price is greater than your value.

If you aren’t getting appointments, your price is greater than your value.

If you aren’t doing inspections or estimates, your price is greater than your value.

If you aren’t even getting a chance to talk at the front door, your price is greater than your value.

Your #1 Strategy for increasing sales should always be to first increase your value. Cheap prices are a curse because competition is stronger at the bottom, and profits are also smaller. As the late Jim Rohn often said, “Don’t wish it were easier; wish you were better.”

If you need to see it in a math formula, think of it like this: value > price

Alternatively, you could express the formula like this: price < value

PRICE IS LESS THAN VALUE

There will always be somebody willing to do the job you just sold cheaper.

It may be a dollar cheaper, or it could be a thousand dollars cheaper, but always cheaper.

There’s always the story of that one customer that got away because somebody else was willing to do it cheaper — even cheaper than what it would cost you to do the work.

Imagine the possibility that your customer didn’t get away because they found a cheaper price. They actually got away because they found more value for the price they were willing to pay.

You may say, “Well, our company does a much better job than that company!”

You may be right, but “a much better job” was not what your customer valued. They valued something else, and you lost the business.

You may also say, “Well, we’re licensed, certified, master, pop star, super-duper, bonded, rock star roofers.”

Again, I’m sure you are, but that’s not what your customer valued, or at least, not what they value as much as you, and that’s why you lost the business.

THE FAIRY TALE

Whatever fairy tale you’re holding on to about why all prospects should magically gravitate towards you, and ignore all others, is almost always based on the false assumption that your value is obviously greater than your price.

Here’s the reality check: When your value really is greater than your price, all customers will magically gravitate towards you, but they aren’t, are they?

Money will always follow value, regardless of the price.

Peace,
Mike