Offering a discount for your services might seem like a great way to attract new clients and get your business off the ground or a new service launched.
But it’s a double-edged sword. A discount may well attract someone to buy from you and you feel happy because you’ve got your first client and you assume they will stay with you because you’ll spend a lot of energy bending over backwards to please them thinking they will return your devotion and remain a customer. Well the news is they will – as long as they can keep you on the discounted rate.
My experiment on discounting
Last year I ran a campaign where I offered a trial package of 10 hours virtual assistance at the lower rate of the 30 hour package. It was a good deal. The idea was let potential clients try out My Super VA without any commitment beyond the 10 hours for them experience how good we were. Having tried us out, the logic was they should select a package at the normal rate.
I sold quite a few trial packages at this low rate. However, it didn’t get us a single ongoing client.
What it did give us was a lot grief from low value clients. One in particular was used to paying $5/hr for overseas virtual assistants. She complained to me about the many problems of using overseas VAs – conveying instructions, communication problems, time difference, quality of work, language/grammar – the list was endless.
Needless to say, we more than exceeded her expectations on her trial package – she was over the moon. The adage ‘you get what you pay for’ was well and truly demonstrated and proved. Yet she didn’t want to purchase any ongoing package. At a push, she could stretch to purchase more trial packages with no commitment for continued work – not the kind of client we want at all.
Lessons learnt on discounting
So the lessons I learnt from this little experiment on discounting fees were:
- You’re selected on price alone
- People who select on price alone, only care about price
- When you raise your price, they will leave
- Discounted prices attract low value clients who can’t afford your true value
- Discounted prices don’t attract the high value clients who can afford your true value
- A lot of time and energy is wasted on low value clients
- I prefer attracting high value clients who select me for the value I provide for them, not what I cost.
The alternative to discounting prices
So how can you give potential clients a sample of what it’s like working with you without it costing you time and wasted energy on the wrong prospects? How can you filter out low-value clients?
You can do this with a one to many product. A one to many product is something you create once and then use again, again and again for many people. It can be a report, check list, swipe file, webinar or recording.
The freebie benefits
- It contains useful information that your ideal clients need.
- It demonstrates your expertise and knowledge.
- It starts the rapport building phase.
- It filters in your ideal high value clients.
- Once set up, it costs nothing to deliver in both time and money.
If you need help with creating your one to many product, then why not take up a free 30 minute consultation with me. We will find out what you’re stuck with and how to get you unstuck. Click here to set up a free consultation with me.