The Secret is to Create Value using a Bundling Strategy
This powerful strategy can reduce, or completely eliminate the need to discount your products or services ever again. When any Small Business feels the need to increase sales, they immediately think the best way to accomplish that goal is to discount their prices. Every day you see products and services offered at discounts ranging from 10% up to 70% in some cases.
Most Business Owners discount their prices without properly preparing a Strategic Plan of Action. A Strategic Action Plan is a collection of tactics that are implemented in a predetermined sequence in order to produce a specific outcome.
You MUST implement a pricing strategy that will produce the appropriate end result for your business, which is to increase your profit margins. I teach a process that enables you to do this. To get you in the proper frame of mind, it’s important that you realize that when a prospect considers buying what you sell, they all want the exact same thing, the best deal. It doesn’t matter if it’s a stick of gum or a new car; we all want to know we got the best deal we could possibly get. However, the best deal doesn’t mean the lowest price. It means the most value for the price we pay.
The closely guarded secret that successful businesses don’t want you to know is this. STOP discounting and instead, innovate your business so you offer more value than your competition, even if that means increasing your price. Discounting destroys profit, and profit is the lifeblood of every business. I know businesses that today are making well over $2 million dollars in annual revenue, and yet they fail to make a profit. Then they sit around asking themselves how they can dramatically increase their revenue.
It’s important that you realize that when a prospect considers buying what you sell, they all want the exact same thing, the best deal. Most Small Business Owners mistakenly assume everyone is shopping for the lowest price. In reality, most of them are, but only because the sellers give the buyers no other choice. You see, if all the sellers look exactly the same, in other words, they all offer the exact same product or service, then the only value proposition left to a buyer is the price.
The real key to success in Marketing is to offer more value than your competition. Prospects will pay twice the price if they believe they’re receiving four times more value. Unfortunately for the vast majority of Small Business Owners, they truly believe price is the sole determining factor when prospects make a buying decision. Then to add insult to injury, they begin to “discount” their price and end up destroying their profit margins. This may shock you, but do you realize if you discount your price by a mere 10% you now have to sell 33% more just to break even?
That’s why smart Business Owners will add value to what they sell, and then increase the price accordingly. “Product bundling” is a great strategy to use when you want to create additional value for your business. Product bundling is simply the process of grouping together certain products to create “packages” which you then sell to your clients. At the heart of all value-added proposition lies the need to help make your clients’ decision-making process easier.
Many people are very indecisive by nature and will often prefer not to make a decision at all rather than make the wrong one. Product bundling can help people make easier decisions. Make it easy for your clients to buy from you. Take away the barriers, bundle so much value into what you offer that it makes their decision a total no-brainer and you will see a huge difference, both to your business reputation and to your bottom line.
Here’s To Your Success!
Business Coach & Marketing Strategist