It used to be that when my business got a little slow and I had fewer clients, I would offer some sort of discount to encourage people to get their projects started.
Sometimes it worked really well, and I got lots of new customers. It worked because savvy, bootstrapping entrepreneurs know they need a business plan, but because they’re on a budget, they want to spend as little as possible. A discount gave them a little incentive to start working with me sooner. It was effective.
But something happens, over time, when you run discounts.
People start to expect them. And they start devaluing your work.
After all, if you’re willing to work at a lower price, why not simply ask for a deal rather than waiting for a promotion?
Recently, this phenomenon got really bad. A potential new client asked me for a discount immediately after reading my proposal, and when I declined, she compared my price to my competitor’s price, and complained that I was charging too much.
Big red flag, right?
I explained my pricing, she agreed to it, and we started the project. But I should have known that wasn’t where it would end. The rocky start to this business relationship continued with requests for changes to the terms of our contract midway through the work, further comparisons to my competitors, and even a request to know my age. MY AGE.
This morning I was graced with a request to start a new project immediately, and that it would be paid for “soon”.
Well, I’d had enough. And I fired this client.
Just so you know, I didn’t feel good about doing this. I made a huge mistake. Two, actually. The first and most acute was that I took on this project even though I knew it would be a nightmare. And the second was that I had conditioned my leads to expect a discount simply because I had offered them in the past.
Everyone Makes Mistakes
Hey, I’ve been doing this for over five years and I haven’t perfected the game. But I have made what I think is an important shift in my customers’ perception of the value of the work I do. I might discount products or programs from time to time, where it makes sense to do it. But:
I’m never going to offer another discount for my one-on-one work again. And neither should you.
Your expertise, your credentials, your experience, and your one-of-a-kind way of doing things is valuable. It’s unique. No one does what you do exactly the way you do it. And there’s HUGE value in that for the right customers.
- If you’re a web site designer, you can code, create beautiful images, and uniquely perceive colour, all while communicating seamlessly with your clients. You are better at one of these things than all the rest. Own that. You’re worth the price.
- If you’re a marketer, there’s probably an industry you know better than all others. You will achieve incredible results for your clients in that industry. You’re worth the price.
- If you’re a freelance writer, there’s a topic you have absolutely mastered. Sell that knowledge. You’re worth the price.
- If you’re a photographer, you have an eye that no one else has. And probably a camera no one else has, either. You’re worth the price.
- If you’re a consultant, there’s a specific type of client you can serve better than any other. That’s where your heart is. And you, too, are worth the price.
Whatever professional service you provide, you’re worth what you’re charging. Actually, you’re probably worth double what you’re charging, because most service providers undercharge.
If you’re doing to discount anything, discount a commodity like an e-book or a t-shirt. But when it comes to the massive value you provide to your clients, you’re worth every penny, all the time. And if someone doesn’t like it, tell them to move on.
Are you guilty of discounting your professional services? Tell me your horror story in the comments below!
(photo credit: Thomas Leuthard)