Anyone in business knows you should charge your worth. But what does that mean? There’s a difference between what you think you’re worth, what you’re actually worth and what the market will bear.
I have two streams of income. I am a professional speaker and the owner and medical director of a medicalspa where I offer cosmetic anti-aging treatments. When I first opened the spa, I didn’t know my worth. I was venturing into new territory, having left a successful career as an emergency room doctor and was not confident in the value I brought to my new patients.
I set prices that I thought the market would bear for my services. Some worked and some didn’t. Some were too high and some were too low. When my price was too high, the service didn’t get traction and when I was priced too low, I was resentful. Over the years, I adjusted accordingly.
You might think that as I have become more expert in my field, my prices would have increased. Actually, the exact opposite is true. Over the last eighteen years, as I have become a sought after cosmetic doctor and expert facial injector, I have lowered my prices.
I know my worth, I am confident in the value I bring and yet I have lowered my prices. Why? It’s simple – it was good for business and it was good for the women I was trying to serve.
Let’s talk dollars. As a cosmetic doctor, Botox injections are a staple of my offerings. It is a simple procedure that should be repeated three or four times a year generating repeatable income. Initially my price was $340, mildly expensive for my location but not outrageous. Women didn’t complain about the price but they also were not being treated three or four times a year.
I made a decision to drop my price. Now the price is $300 and I have also instituted a VIP program. If the patient returns within four months, the price drops down to $240. If she is outside of the four month VIP window, the price goes back to $300.
Ninety-five percent of my patients leave with a scheduled appointment in three and a half months so if a scheduling conflict arises, they are still within the four month window. Not only did I capture the repeatable income, but I attracted many more women who would not have been able to afford my services. Most of these women have been with me since the program began seven years ago.
I didn’t lower all my prices. I offer procedures that require a great deal of skill on my part, for which the price remains the same. Because I increased the number of women I serve, I have also increased the number of women who are opting for additional, more expensive services.
I also instituted a referral program. If you refer someone who spends $250 in services, I will give you $100 off your next treatment.There is no limit. If someone refers ten patients, I will give them $1,000 worth of free services. That’s real money.
This may not be a reasonable model for you to adopt, but in the cosmetic industry, no one talks. It is not a big referral business. Patients tend to keep their treatments a secret. Due to this program, referrals, which once accounted for the lowest percentage of my income, now account for the largest percentage of my income.
It is important to remember that if your price drops, the quality of your care and involvement must not. No one wants to feel they are not being treated well because they are paying less money. It’s bad for business. For me, caring about people in my charge is inherent in who I am but I thought I would mention it for the sake completeness of this article.
It’s been said that in order to be taken seriously, you have to charge high prices. There’s nothing wrong with charging high prices. If you work with senior executives or corporations who have the money, that makes perfect sense. But if you work with entrepreneurs, or single moms or the working poor who don’t have the money that means you will help less people.
When you lower your prices, you remove the financial excuse for people to work with you, no matter your industry. It turns out you can help more people by charging less money. For me, my business grew exponentially. Because I have a low ticket offer to compliment my high ticket offer, I have been able to work with hundreds more women who can now afford me.
So what are you worth? Me, I’m priceless!