Pricing in our New Economy

In this new economy, it is critical to pay new attention to our pricing strategies.  The strategy we used to price offerings 5 years ago may no longer be effective, so it’s time to re-evaluate those offerings and the pricing strategies we are using today.

Ironically, it’s an old fairy tale from the 1800’s that can provide us new insights for our offerings and pricing in this new economy.

Here’s a quick summary of the Hansel and Gretel story:

Hansel and Gretel are the children of a poor woodcutter and his wife (their stepmother).  Since the stepmother did not like the children, she decided to take the children into the woods and leave them there so there would be fewer mouths to feed.  Hansel overheard his parents speaking about the plan, so after they went to sleep that night, he went out to gather as many white pebbles as he could.

The next day the parents led the children deep into the woods, and as Hansel was walking, He dropped the white pebbles behind him.  The parents left the children in the woods, but the children simply waited for the moon to rise and followed the moonlit pebbles home.

When they saw the children, the parents got angry and led them deeper into the woods.  This time the children used a breadcrumb trail, but when they tried to follow them home, they found that birds had eaten them all!

Lost in the woods, the children eventually stumble upon an old witch who eats children!  It was a horrible time, but the children outwit the witch, kill her, and are free.  They find in the house a vast treasure and precious stones.  They run the treasures home and find the stepmother had died of unknown causes, and the father was happy to see them!  The vast treasure allowed the family to have money and they all lived happily ever after.

So what can we learn from this old fairy tale when it comes to our marketing and our pricing?

  • Be sure that your offerings are made of white pebbles, not breadcrumbs.  Offerings need to have a long shelf life and the versatility to be reusable or repackaged in various ways.  Experiences are a great way to connect with your potential clients, so give them great value and then repackage the final offering in a new experience.
  • Remember that the pebbles (low-priced or free offerings) always lead the consumer to bigger offerings and bigger experiences such as the vast treasure. Be sure that the offerings are logically stepped up so that the customer/client can see value in each offering and the increased value in each price increase.
  • Don’t be the wicked stepmother.  Don’t lead your potential clients into the woods and leave them there to get eaten by a witch.  Guide your potential customer from one offering to the next (up the pricing chain), making your website and marketing materials CLEAR about the path of increased value.
  • When you only have one offering (i.e. the witch who wanted to eat the children) you have to be careful not to get burned and die!All offerings can be and should be packaged in various ways. Every product can be made into at least 5 product variations, allowing your income options to vary. For example, if you have just written a book, it can become any (or all!) of the following 8 products / offerings:
    • Paid speaking gigs
    • Audio Recordings
    • Coaching
    • Print Workbook
    • Online Workbook
    • Live Workshops
    • Telephone Workshops
    • eBook

Do this for ANY product to increase income streams simply, using the same content and services.

  • Pay attention to the conversations around you (i.e. the parents planning to “lose” the children in the woods) so you can always be prepared. What are people in your social networks saying they need?  How are others pricing similar products?  What are the latest (and predicted) trends and how can you plan to be in the forefront of that trend AND have your offerings be priced appropriately?  Start gathering those white stones now.

Take a look at your current offerings and pricing strategies – will they bring you treasures and happily ever after, or a witch with a hot oven?

Blog post written by Lorin Beller Blake


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