How to handle a classic objection to value pricing
Many of you know that the best way to improve the profits of your Web design/development business is by getting good at value pricing. Value pricing means that you don’t trade time for dollars, but rather explore the value of your solution with the client, and charge on that basis. For more information, check out Million-Dollar Consulting by A. Weiss, SPIN Selling by Rackham, or my manual at itprosuccess.com.
Value pricing is a whole different mindset, and so requires a whole different approach to talking with prospects about what you do. It also means handling a new set of objections.
One of the most common objections you might get is, “Why should I pay so much money when this takes you so little time?”
Let me give you an example from one of the world’s most famous consultants. He shared this story with me when we met for lunch one day.
This consultant has a program where he charges $100,000 to meet once a month for a year with his client, for about half a day per month. The outcome he provides is simple: He will work with his client to change one, and only one, behavior in how that person manages or conducts him/herself at work.
He can get away with this type of fee partly because the Wall Street Journal named him one of the top 10 executive coaches, because he’s a well-received author and speaker, and because he’s done all the other things you need to do to position yourself as a leading expert.
Still, $100,000 for about 6 days of work?
I asked him point blank, “What do you tell prospects who ask you how you get away with charging so much for such a small amount of time?”
How would you respond to this objection?
Answer next time…..