Losing Customers is a GOOD Thing

Crazy thought of the day: losing customers is a GOOD thing.

Pricing is a big issue. I’ve advised countless creative businesses about it over the years.

You want to raise prices to make more money. But then your customers might go to cheaper competitors. That’s the fear. And it might be true.

If you can’t raise your prices, you don’t have a competitive advantage. More likely, you DO have one, but you’re not using it.

If customers can go to a rival for a cheaper price, it means that you’re selling more or less the same thing.

But if you had a monopoly, customers would pay whatever you charged them. They’d have to. There’d be nowhere else for them to go.

Would you like to have a monopoly? Well, you certainly can move in that direction.

Here’s a thought exercise I sometimes use in my coaching with creative business owners….

Imagine you doubled your prices. What would happen? You’d lose some customers. Yes.

But those customers were only with you because of price. Not because of something special you have that rivals don’t.

Other customers would pay the increased prices. Why? Because they need you. Because you’re special. There’s something about you that they cannot get elsewhere.

It could be your creative skills. Or the working relationship you have with them. Or some other benefit they get from buying from you.

Try it. In your mind, ramp up your prices. You’ll realise there’s only one way to stay in business.

You’ll have to offer something that rivals cannot. You’ll have to identify what’s unique about your business: your competitive advantage.

Not every customer will want your special thing. So then you’ll have to identify customers who DO want it. And who will pay a high price for it.

This thinking leads to a breakthrough. To making more money. From customers who are happy to pay you. And for working at your highest level of creativity.

The most successful creative businesses don’t have a problem with pricing. Because they’re not selling the same as everyone else. They’re not competing on price.

Instead, they use their difference as their strength. Then they find the market for it and make it their own.

Pricing isn’t about negotiating. It’s about business strategy. It’s about positioning.

It’s about offering your uniqueness to the customers who need it. This is one step nearer to a monopoly. It changes the power balance in your favour. And in this new position, increasing prices is easier.

Here’s the thing though – if you just double your prices, it might work.

But you might end up getting no customers and lose everything.

That’s why you need to know the following:

– how much you can raise prices by

– exactly the right way to do it so you don’t lose existing customers who would pay the higher price (but only if you approach it in the right way)

– the wrong way to do it so you don’t make those mistakes!

Answering these questions is one of the things I do in my online coaching for creative business owners.