I know someone who can do it at half your price
|Jan 17, 2019|
That's one of the most frustrating things you can ever hear.
Someone who complains about the price.
The thing is, it's actually your fault.
Now there are some businesses where you don't have much control over the price. Commodities - where there are so many available vendors that the "market" sets the price and you can't differentiate yourself.
But most businesses - retail, products, services - have room for differentiation.
Your difference might be that you're cheaper than everyone else. Personally I think that's a dangerous game to play, as there's always someone who is willing to go cheaper - maybe as a loss-leader to destroy your business.
But if you know your ideal customer (who we spoke about earlier in the week), you understand why they want your stuff and how much it's worth to them, you should be able to choose points of differentiation that make price irrelevant.
Let's say you're a second hand store. You buy up used goods, clean them up a bit and then sell them on. Necessarily, the price you offer for a particular item is going to be less than the price someone can make from it by selling it themselves. You need to spend some time cleaning it up (which costs) and you need to add some markup, in order to make a profit.
So, straight away, we've got a price discrepancy. I can take my X and sell it with you for £20. Or I can take my X and sell it on the local Facebook buy/sell page for £30.
Why would I go with you?
This is where your story comes in. You need to go back to your customer's "why". You need to connect it with you.
So maybe you tell the story of how you were selling something on Facebook, got scammed and ended up out of pocket. The burning injustice of it, though, was you were going to use the money to buy your niece a present for getting through her exams. When this happened, you vowed to ensure that no-one had to go through a scam buyer like this again. And you make sure that everyone who sells through you is treated fairly, with guarantees, up-front pricing and safe and understandable terms.
Suddenly, there's a reason to take the £20 instead of the £30. It's all to do with peace of mind. Of trust. Of safety. Which is easily worth the £10 difference.
Take action: Don't compete on price - come up with a differentiation
PS: If you'd like a hand coming up with your differentiation, drop me an email - email@example.com
Photo by Jordan Rowland on Unsplash