About a week ago I dropped my iPhone. From about four feet up. Straight on to the concrete sidewalk. I had a “Schrodinger’s Cat” moment. Please don’t be broken, please don’t be broken…
Well, it was. Smashed. In a very pretty spiderweb pattern, but smashed, nonetheless. First thought, “Crud!” Second thought, “How much money did I just cost myself?” And then, “Am I going to have to buy a new phone, or are there people who fix these things?” Yeah, you probably already knew there are lots of places that fix them, but this was my first phone-smash.
Somewhere in the Googling, phone-calling, fingertip-slicing days between smash and fix, I did have to wonder – what is it worth to me to get this fixed? Leaving it as it was was not an option – little pieces of glass were starting to fall out and I knew I was leaving it open to water damage. Not to mention the finger-slicing hazard. But, should I fix this phone (a hand-me-down iPhone4 – I’m cheap) or get a new one. Well, I already mentioned my cheapness (which I prefer to think of as bargain-hunting-prowess, thank you very much). So, $79, a new carrier contract, or $649? Easy choice. Well, mostly.
How Much Does it Cost – Or How Much is it Worth?
A replacement screen for an iPhone4 costs approximately $9 online. Many repair shops advertise a 30-minute turn-around time. So, let’s figure the technician is paid $20/hour and overhead accounts for another 100%. That works out to be approximately $29 worth of parts, labor and overhead on a $79 repair bill. No, I’ve never run a cell phone repair shop, so I don’t know that that is even close, but you get the point!
Why People Don’t Just Do it Themselves
Usually I’m up for a DIY project. BUT THIS IS MY PHONE. My lifeline, my business, my connection to my friends. You know I’m not being overly dramatic here. Then there’s the matter of the broken glass. I need my typing fingers whole. Add to that the possibility of completely destroying the phone, and the answer was clear. What the repair cost was kind of a lot. But it was also completely worth it to me.
But Wait, There’s More!
The shop I chose also offers a lifetime warranty on repairs. I don’t think that means they’ll fix it if I run over the phone, step on it while wearing tap shoes, or use it to fend off an attacking gator. In fact, I don’t have any idea what the warranty means. The details didn’t matter too much to me. It just made me feel a little more confident doing business with them.
Why Figuring What Your Product or Service is Worth is More Important than Answering What It Costs
Lots of people have figured this out. This is why “price-gouging” laws have been enacted. A gallon of fuel on a day when it’s the only gallon of fuel available in a 100 mile radius is worth a whole lot more to a stranded motorist than on any other day. But, we’re not talking about being a creepy opportunist.
Let’s say your Pinterest strategy and setup service (just for example :)) takes you about an hour with the client, three hours for strategy, five hours for setup and another hour for training. Should you just figure out how much that costs you in employee wages and mark that up a bit? No! And why not? Because that is selling on cost and feature rather than value.
Consider the Value to Your Ideal Client
Forget the people who would rather do it themselves. For them, your product or service, in this case Pinterst Setup and Strategy is worth nothing. Instead, focus on the person who needs your service and the value that service provides.
By hiring you to do the work they are getting:
- A professional strategy,
- Gorgeous product (here, optimized profile and boards),
Remember, the time saved here is not just the number of hours you are spending, but includes the number of hours it would take them to learn the platform, learn how to do the strategy and set up the account. You know how long that takes! Then there is the value of your own accumulated experience. Don’t forget about that!
How to Present Value
Of course, you need to tell your customers what product they’ll get and you’re going to do (although in the case of ongoing management it should be understood that things are subject to change as it becomes clear what is working and what isn’t). Many businesses also find it beneficial to list pricing, or at least a price range on their websites. However, the focus should really be on the value you will deliver.
Will your new service bring new leads and customers to the customers’s website? Will your 50 years of experience with tax law mean they’ll get the best refund and no audits? Will the product improve their car’s gas mileage? Will it restore their iPhone to like-new condition, protecting it from water damage and stopping sliced-finger syndrome? Talk about that. It’s the “What’s in it for me?” answer.
Don’t forget the “Wait, There’s More!” bit, either. There’s a reason informercials use that strategy. You don’t have to actually say it, but you should give them reason to understand all the value behind your product or service. Do you offer benefits that aren’t actually part of the product or service itself? Examples include a money-back guarantee, free shipping, free technical support.
Oh, by the way, this blog post is part of the Word Carnival. Each month, a bunch of us small business owners get together and blog about a timely business topic. This month’s topic is “How to market your value and not your price.” Be sure to check out the other blog posts in the series!