As Dan Kennedy points out in his new book, “No BS Guide To Price Strategy”, what a person will pay for services, is based both on their perception of themselves, and their perception of you.

Which, when one thinks about it, is a great argument for targeting the higher end of your market.

Here’s what I mean.

Let’s say your market is small business. (A terrible way to define a niche market by the way, since it’s way to broad-somewhat akin to saying, “Let’s go eat American food”.)

You could focus on those companies that are small and probably struggling-in which case every dollar they spend comes oh-so-reluctantly out of their pockets. This group will tend to lump your services into a “commodity mindset”. Their decision to hire you will be largely based on price.

But that’s OK, because that matches up precisely with how these services providers are presenting their services. The message is mostly, “We do this. We do that.” That’s what referred to as a Features Presentation.

So what’s missing? (And how does affect price?)

What’s missing are Benefits. That’s what starts (but only starts) the process of breaking you out of the generic “I’ll buy the lowest price service” trap.

But most people don’t really understand what benefits are-so let me share a simple definition. They’re the answer to “Why do I care about that particular feature? How does that help me?”

So communicating benefits is the first important step in breaking out of the commodity-pricing trap you may find yourself in. But it’s not the most important strategy.

What’s most important is WHO you are focusing on. Given the choice between those who have money to spend and those don’t, where would you put your efforts?

The “Duh” answer is-people with money.

Yet, most advisors, consultants and business owners don’t actually do this. (This is another disconnect between what we know intellectually to be true, and what we actually do.)

There are a lot of reasons for this. Most of them have to do with mindset and a lack of confidence-but that’s another conversation for another day.

But here’s the HUGE advantage for focusing on the highest end of your niche market.

Price is not the big factor. (With the caveat being that you do a good job of communicating your benefits.)

The upper segment of your niche market views themselves very differently. They are successful, and they expect those they work with to be like themselves-prestigious, successful providers of a particular service.

Which is why at the high end of the market, a small percentage of advisors, consultants and other high-value services providers continue unfettered by economic calamities.

Now this doesn’t happen by chance. You can’t just say “OK I’ll focus on the high end” and expect your world to change. You know that. Rather, what this means, is that you need to somewhat re-engineer your business from a marketing perspective. Both in terms of WHAT you say (there’s that pesky benefits issue again) as well as WHO you target, and HOW you present yourself. (For example, unless you really are a website designer, a do-it-yourself website looks, well…)

But here’s the bad news (at least for most businesses).

This does require hard work. A lot of mental heavy lifting, along with an investment of time.

And most people aren’t willing to do that. The pain isn’t bad enough, or the desire isn’t great enough, to go through the effort that any type of significant change requires.

But for those who do (and naturally my business is largely showing clients how to play at the high-end of their respective markets) the rewards, both economically and psychologically are absolutely amazing.

Food for thought.
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