Written by: Amanda Rose, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
Entrepreneurs are plagued by conundrums regularly about which paths to take to run their businesses. One of those tough questions that entrepreneurs must ask is, "Should I list my prices or hide my prices?"
If you are stumped on which direction to go, you're not alone. There are 2 schools of thought when it comes to this.
Let's explore them both...
School of thought #1: Keeping your prices hidden
When I started as an entrepreneur, I was taught never to post the pricing of my products. The idea was to ensure that people did not pre-disqualify themselves because of the cost.
In practice, this school of thought generally means you need to reel prospects onto a sales call, make them want your product or service, overcome their objections, walk them through finding a way for them to afford it, then close the sale quickly before they have time to think it over.
After years and years in business and well over a decade in sales, I have concluded that I don't like this method, nor do I recommend it, for the following reasons:
1. YOU ATTRACT THE FREEBIE HUNTERS
If your audience never sees you share your pricing, they may assume that promoting is free. Unfortunately, this means you will run into the issue of having many shocked and upset people on the other end of the phone when you drop the price tag on a sales call.
PROSPECTS WILL ATTEMPT TO GUESS YOUR PRICES (MOST OFTEN, INCORRECTLY!)
Several months back, as I was scrolling my Facebook Newsfeed, I saw an entrepreneur post an advertisement with a professional graphic and well-crafted sales copy for an upcoming 3-week course running without stating the price. Based on what I had seen, I assumed the course would be a minimum of $1500. I later discovered the course was only $97!
HIDING YOUR PRICES REPELS MANY POTENTIAL BUYERS
Shoppers are both aware and warry; they do not like getting onto a sales call blindly. No one likes being sold to or pressured into making a quick decision. Many prospects will move on and pursue another business for their needs if you are not transparent with your prices upfront.
YOU ADD EXTRA WORK TO YOUR PLATE
You will end up needing to do three times as many sales calls due to having a lower conversion rate when you wait until the call to let prospects know how much your product or service costs. When a prospect knows the costs upfront, they are already interested and more likely to say yes by the time they get on the call.
PRESSURE-BASED SALES LEAD TO CUSTOMER DISSATISFACTION AND HIGH REFUND RATES
Not only do you have to do more sales calls to make sales, but you are also having to do more customer service work to handle disgruntled customers who regret having said yes! You will be issuing more refunds, dealing with more bad reviews, and having to douse the flames of angry customers. On top of being time-consuming, this drains your energy, makes you feel bad, and can stop you from wanting to get on more calls.
School of thought #2: Price Transparency
This school of thought is used by business owners who are confident that they have nailed their ideal client avatar, who want to attract the exact right clients, and who are ready to invest.
After I transitioned from hiding my prices, as I originally had been taught to do, and I began to get my pricing out front and center, my sales increased exponentially, and my refund rate dropped to next to nothing! I use and recommend this method because:
THE PERCEPTION OF VALUE IS CREATED
When your prices are out in the open, on social media, on your website, etc., then subconsciously, your audience begins to associate you and your business as being of value. Likewise, it repels the people who are looking for freebies and handouts, saving you a great deal of time.
PROSPECTS ARE PREPARED TO PAY
When you get on a sales call with a potential client who is already aware of your pricing, then they don’t have to overcome a sudden “sticker shock,” and instead, they will be ready and willing to invest.
YOU WILL HAVE A HIGH CONVERSION RATE
You will not need to do as many calls, and besides, the calls that you do get on will have a better percentage of conversion. Your sales calls will be geared towards start dates, proposals, objectives, and contracts rather than focusing on overcoming price objections and getting someone’s credit card number before changing their minds. In essence, the prospects you have lined up will be primed and ready to buy before they ever get on the call! How great is that?!
IT EMBODIES CONFIDENCE
When you aren’t trying to bury your pricing under red tape and know your value in the marketplace, it speaks volumes about your confidence in who you are and what you do. You will not care who your prices scare off because you know that listing them will attract the right people. You will also give buyers confidence in parting their money to you; people will only buy from people they trust, and your inner confidence will exude out and put prospects at ease to know they are making the right choice.
PEEPERS AND CREEPERS
When your prices are out in the open, you will attract the buyers, who don’t even need the sales call; they will hop on over to your website and buy!
The Exception to the Rule: Market Price & Custom Jobs
As with everything in life, there are always exceptions to the rule. Depending on your business and offerings, you may have a sliding scale, need to provide custom quotes, or offer market price* goods. In these instances, it can be beneficial to offer examples or price ranges.
*Market price refers to goods that change value based on supply and demand.
Price transparency can give your business a major leg up by saving you time, bringing more of the right customers to you, and repelling people who are just looking for freebies!
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Amanda Rose, Executive Contributor Brainz Magazine
Amanda Rose is the founder & director of The Infinite Power of You Inc., a multi-published multi-genre author, business, wealth, & mindset coach, actor, motivational speaker, and online course creator. She is a multi-passionate entrepreneur who has been in the online space since 2013, and a sales expert for over 10 years. It's her passion to help her clients build lives of freedom and joy, and thriving businesses with multiple revenue sources, through strategies combined with mindset mastery. Amanda's mission to shift human consciousness to create soulful abundance through mindset practices.