sometimes I feel like I’m swimming against the current when it comes to charging for my services.
People always tell me “You’re crazy to give so much away for free! You’re leaving money on the table!” And while I appreciate the sentiment I think it’s a bit more nuanced than that.
The Freebie Trap
Let’s face it the whole “give away a ton of free content” thing is a bit of a double-edged sword.
You’re attracting a ton of attention and building your brand but you’re also attracting a lot of people who just want the free stuff.
These are the customers who will ask you for endless help and support without ever paying a dime the ones who will constantly be asking for “more” and never feel satisfied.
This isn’t to say that all free content is bad.
In fact I think it’s essential for building a loyal following and establishing yourself as an authority in your field.
But you need to be strategic about it.
The Free vs. Premium Paradox
The key is to understand that free content is not just a marketing funnel to sell your paid products.
It should also be valuable on its own.
You need to provide real tangible value that will leave people wanting more.
This is where the concept of “premium” comes in.
By offering high-quality free content you’re setting a high bar for yourself.
You’re essentially saying to your audience “This is what I’m capable of and my paid products are even better.” It creates a sense of expectation and builds a perception of value.
Free as a Disruptive Force
Think about it this way: if you can disrupt the market with a truly incredible free offering you’re going to be the talk of the town.
People will be sharing your content recommending your services and spreading the word.
It’s organic marketing at its finest.
This is particularly powerful in industries where a free offer for superior products/services is more disruptive.
If you can get your free offer in front of enough eyeballs and wow them with what you’re giving away you’re bound to have it come across the desk of (what Malcolm Gladwell calls) a “connector”.
Premium as a Value Proposition
On the other hand premium pricing is all about delivering a premium experience.
It’s about going above and beyond providing personalized service and exceeding expectations.
You’re catering to a specific audience a niche market that values quality over quantity.
These are the customers who are willing to pay a premium for the expertise the attention to detail and the results.
The Danger of the Middle Ground
The real danger lies in the middle ground.
When you’re stuck in that low-to-mid price range you’re competing with a ton of other businesses who are either under-valuing themselves or are too scared to charge what they’re truly worth.
You become just another face in the crowd and it’s very difficult to stand out.
How to Charge More (Or Nothing At All)
So how do you figure out the right pricing strategy for your business? It’s a constant process of testing iterating and learning.
Find Your Unfair Advantage
The first step is to identify your unfair advantage.
What are you uniquely good at? What makes you different from the competition? Maybe you have a unique skillset a passion for a particular industry or a personal brand that resonates with your audience.
Once you’ve identified your unfair advantage you can leverage it to charge more.
Target the Right Market
The second step is to target the right market.
Not everyone is going to be willing to pay a premium for your services.
You need to find customers who value what you offer and who are willing to pay for it.
Deliver a Premium Experience
The final step is to deliver a premium experience.
This doesn’t necessarily mean you need to spend a ton of money on fancy marketing or fancy offices.
It’s about the small details the personal touch and the commitment to exceeding expectations.
Case Studies: From Free to Premium
Let’s take a look at a few real-world examples of businesses that have successfully transitioned from free to premium pricing:
Qualaroo: From Small Businesses to VC-Backed Clients
Qualaroo a tool for gathering customer feedback initially targeted small online businesses with a free and a paid option.
It wasn’t quite hitting the mark so Sean Ellis a marketing expert saw an opportunity.
He dumped the free offer and significantly raised the price targeting $1MM per annum and VC-backed clients who were willing to pay a much higher fee.
They saw a different market segment that valued their product.
Empire Flippers: From Auctions to a Curated Marketplace
Empire Flippers a marketplace for buying and selling online businesses originally listed websites at auction with a $1 starting price.
However they realized they could charge more by providing a curated marketplace ensuring the quality and integrity of the sites listed.
They also streamlined the buying and selling process creating a more efficient and enjoyable experience for both sellers and buyers.
Beyond the Money: Building Relationships
It’s important to remember that pricing is not just about making money.
It’s also about building relationships.
By offering valuable free content you’re building trust and rapport with your audience.
You’re demonstrating your expertise and establishing yourself as a resource.
This is where the power of personal connection comes in.
You can’t automate relationships and that’s where the value of personal relationships comes in.
While it might not scale as easily taking the time to build personal connections can make all the difference in turning prospects into loyal customers.
The Bottom Line: It’s About the Value
At the end of the day it’s all about the value you provide.
If you’re delivering a premium experience you’re going to be able to command a premium price.
But if you’re just giving away cheap low-quality content you’re only going to attract cheap low-quality customers.
So take the time to figure out what you’re truly good at who your ideal customer is and how you can deliver a truly amazing experience.
And don’t be afraid to charge what you’re worth.
You deserve it and your customers deserve it too.