How can you charge more for your services and products?
I went into the supermarket the other day and a display of caught my eyes. It was for cough suppressants, of all things. Throat drops and oral lozenges. I was intrigued. Why were there so many brands, I wondered? I was bored waiting for a prescription so I compared the ingredients and costs. I didn’t know the cough drop market was so competitive. I was surprised at the range of cost. Why would one brand be four cents a drop while another would be 12 cents a drop? Why is it that one can charge not twice but three times the amount of another competing brand? And did you know that most of them had the same ingredients? Cough drops are just one industry. Every industry is just as competitive. Why is it that some products and services are priced low and some priced high? It doesn’t matter what you are selling. It’s all about marketing—making your product appear more different and valuable. Have you ever wondered how you could make your product appear more valuable? I’m going to give you some hints on how to improve the actual or perceived value. Here are five ideas:
1. Raise your price
Number one: raise the price. If you want to appear more valuable, raise your price. A lot of times people assume higher priced items are worth more. Look at any product that costs more and you’d think it is worth more. The cosmetic industry does this very well. They have a notorious reputation for over charging the poor women of this world. How can they get away with such high-priced items? It’s easy: women pay it.
2. Improve your design
Number two: improve the design. Design increases the value of a product. If all of these cough drops—Fisherman’s Friend, Halls, Ricola, Vicks, Ludens and Generic—were side by side and all were the same price, which one would you choose? If you notice each one of them kind of appeals to a different market. Fisherman’s Friend take the approach that they have a better product because they’ve tested it on the high seas with fishermen. Ricola has that gimmick of the big horn with the guy in the Swiss Alps. So if you want to differentiate yourself, pay for better design.
3. Increase the size or quantity
Number three: increase the size or quantity of your product. Add more value by increasing the product. I see this done with all kinds of products. For example, the other day I saw dog food where they offered 20% more than the normal bag. I thought that was kind of odd but if you think about it, there is extra value there and it makes the dog food appear more valuable than other products.
4. Add something special
Number four: add something special. Add a special ingredient. Take the approach where Certs breath mints add a drop of that magical ingredient Retsyn. And then there’s Listerine that kills germs that cause bad breath. Those are just two examples. Both Certs and Listerine focus on that one thing that makes them stand out.
5. Use a cool spokesperson
Number five: use a cool spokesman. The spokesman represents your company. The Marlboro Man. The Jolly Green Giant. Ronald McDonald. Danica Patrick for Go Daddy. You get the picture. No matter what, give your product a first-class image. You must decide what image you want for your brand. Image means personality. Products are like people: they have a personality. The personality is the combination of several things: name, packaging, price, style of advertising and above all, the product itself. If you want to be different than your competitors then be different. Good luck and keep on marketing your business and let’s make your sales go ape.
Why is this one of the most successful ads of all time?
This ad was created by advertising legend David Ogilvy. I’m going to let David use his own words from his book Ogilvy on Advertising. “You don’t stake a tinker’s chance of producing successful advertising unless you start by doing your homework. I have always found this extremely tedious, but there is no substitute for it. “When I got the Rolls-Royce account, I spent three weeks reading about the car and came across a statement that ‘at sixty miles an hour, the loudest noise comes from the electric clock.’ “This became the headline, and it was followed by 607 words of factual copy.”
It starts with an incredible headline
How important is the headline? David Ogilvy says: “On average, five times as many people read the headline as read the body copy. “When you have written your headline, you have spent eighty cents out of your dollar. “If you haven’t done some selling in your headline, you have wasted 80 percent of your client’s money.” SOURCE: David Ogilvy, Ogilvy on Advertising, John Wiley and Sons, Toronto, 1983 ISBN 0-517-55075-X