Why you should never, ever reveal your headline price
In this post I’d like to share something you must never, ever do: please, please, please don't reveal your headline price. As the Amazon number-one best-selling author of “Effective Pricing for Accountants”, I can assure you it’s an incredibly powerful concept that will get you much, much higher prices with much less price resistance too.
So, what is your headline price?
Very simply, your headline price is the total price. I can probably best explain the concept by telling you about an experiment done some years ago by Ryan Deis, one of the world's leading Internet marketers.
Ryan decided to sell one of his products at $197 and found he sold 340, which generated him just over $66,000. Not a bad result, but it’s what happened next that’s really interesting. He decided to find out what would happen if, rather than $197, he asked for two payments of $97. (It’s not quite the same price but, at $194, I think you’ll agree it's pretty close.)
Do the math
What he found was staggering. His sales increased from 340 to 977, and his total revenue from $66,000 to nearly $190,000. I think you’ll agree that that’s already a staggering result, but then something even more amazing took place. Ryan thought, "That's interesting. What if I offer the same product, but rather than two payments of 97, I make it three?"
As an accounting professional you’ll instantly recognise that's the equivalent of a 50% increase in price, and logic suggests sales would plummet. But – and this is the truly staggering part – they actually went up slightly. Not by much, but overall – between the first situation and the third – sales increased by nearly four-and-a-half times.
The interesting thing we can learn from this is that it shows people focus on the $97, not the math – which would tell them that 3 x $97 is $291. Most people simply don't do the math though. They look at the $97 and make their buying decision based on that.
Use Cloud Pricing software to break prices down
That's why my Cloud Pricing software gives you the ability to express the price as a smaller number. And why, for example, I would strongly recommend you price your annual financial statements or bookkeeping as an amount per month. Never, ever reveal the headline price. You’ll get a much, much better price when you chunk it down to a smaller number. You can find out more about Cloud Pricing here.
You can learn more about why you should never reveal your headline price by watching my short video here. And I'd love to hear what you think in the comments box below. Do you agree – or disagree – with the idea? Do you already do it? And, if so, what have your results been?
Every month I provide free online training helping accounting professionals get results from value pricing. If you want to get access to that free training click here to register your place on the list of people I invite.
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Wishing you every success on your pricing journey.
Chartered Accountant, public speaker and #1 best-selling author of
“Effective Pricing for Accountants”
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