Subscribe in a readerHow can you benefit from being the most expensive provider of your product or service in a business-to-business marketing? Some of your competitors do benefit, why not you? The answer may surprise you ...
With all the price chopping that goes on with sale people you may think it's a disadvantage to be the most expensive provider. In truth, you stand a better chance of being profitable as an high dollar price point than you will fighting for bottom dollar.
Buyers also associate higher price tags with more quality, better performance, and longer term value, if you know how to position your solution. That's why I often encourage clients to raise their price, even to become the most expensive in their market.
Think about this before you say, "But my customers want lowest price?" It's quite possible you've trained them to look more at dollars than what it is you really provide.
You have a choice between a Rolex watch and a digital Timex. Both watches will keep time up to the microsecond; both tell you the hour, minute, and second.
The Rolex actually requires more work, often it needs wound, and reading it is less accurate because you need to chase the second hand.
The Timex provides a stop watch, four alarm settings, provides the date, and is priced at $29 dollars. The Rolex only has the time and date, no alarm or stop watch, and is priced at $2,900 second hand.
Functionally both watches are the same, except the Rolex has fewer features and costs 100 times more. If you could afford either watch, which would you choose?
Depending on how you were trained to buy, you may choose either watch. But you are not YOUR buyer, 5% of your market will choose the most expensive because it is, 5% will always select the cheapest, and the middle will choose according to positioning.
Because Rolex has done such a great job positioning their quality, they are selected by thousands of individuals each year. They have positioned themselves as a status symbol in most societies, and they have a solid product.
Personally, I'd rather do business with those who have money then those who do not. I want the customer who chooses to pay more for unmeasurable reasons, then those who will spend months making a decision over a few dollars.
If you position your product with plenty of reasons why you are the most expensive, you'll not only attract those top buyers but give people in the middle a compelling choice. Your margins will be better so you can actually afford to serve your customers and give them what they expect.
No matter what you do, there will always be someone who can charge less for a poorer quality service. Why not position yourself to provide the highest priced, highest value solution? Don't your customers deserve it.
© 2008 JWH Consolidated LLC, All rights reserved.
Justin Hitt provides services that position industrial and technical providers to get the very best price for their solutions. Increase profits with https://www.justinhitt.com/
By Justin Hitt at January 15, 2009 5:32 PM
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