How do we communicate the value of what we do when we’re having a conversation? This is one of the most important aspects of value pricing.

Coming up with a price is only a small part of value pricing. Being able to effectively communicate the value is one of the most important value pricing skills we must master. However, historically, it’s something the profession is poor at, and I say that from personal experience.

Check out the full video on this topic here.

“That’s a bit expensive…”

The problem is when we hear our customers say to us “That’s a bit expensive!” We can start to assume they are price sensitive.

When I speak at conferences, and I ask, “Who here has price sensitive clients?” Almost every hand will go up.

Here’s the thing: that’s a myth. You don’t have price-sensitive clients.

Firstly, there have been lots of studies done by behavioural economists and price psychologists putting estimates on how many people in society are price sensitive, putting it at around 20-30%.

But not only that, you’re running an accounting or bookkeeping firm, and your firm is not made up of society. It’s made up of a subset of the population made up of business owners and entrepreneurs. Those sorts of people are not in that price-sensitive segment of society.

The reality is, most people are what’s called ‘value sensitive’, and that’s a very different thing. The reason we think they’re price sensitive is because of that reaction that we keep hearing: “That’s a bit expensive!” This leads us to conclude incorrectly that they are price sensitive.

Focus on the value

What we need to start doing is making our entire conversation focus not on the price, but on the value that we’re delivering. Focus on the difference we can make in the client’s life. Focus on the outcomes, the end results, and the solutions.

We talk too much about price and about inputs like how many hours things will take. But the client isn’t interested in how long something will take; they aren’t buying time from you, so an hourly rate will always seem expensive.

Clients are only interested in the end result.

Let me share with you 5 powerful strategies that you can start to use to better communicate the value of what you do.

5 Strategies for better communicating value

Number 1 – Price first in written communication

I strongly recommend that when you’re having a price conversation you have it face-to-face. However, I know that some accountants and bookkeepers have hundreds of clients, and if you’re doing an annual price increase, you haven’t got time to go and visit, or organise an online meeting with, all of them. So sometimes we have to communicate that price rise in writing.

You’ll probably have noticed when you’ve received a quote in the past, the price is at the bottom somewhere. The problem with that is, because people read from top to bottom, the last thing they’re reading is the price. Their mind is focused on the price, and they forget everything that came before it.

Here’s a top tip for you: when you send out a proposal or quote, flip the order. The client’s going to look for the price anyway, so get it out of the way early.

Then, once you’ve revealed the price, talk about all the benefits, the solutions, the unique selling points, all the great things you do and the difference you’ll make.

Number 2 – Focus on the pain

One thing we know is that people are more motivated by the avoidance of pain than they are by the attainment of gain. Marketers often find that pain avoidance headlines get higher conversion rates than ones about gaining something. That means, when we are communicating what it is we will do for the client, we want to start by talking about the pain.

What is the pain that they are experiencing now, or will experience in the future if they don’t act? Think about your service and what problems people have in this area. What are the challenges? What are the penalties if they fail to do it correctly? The more that we paint a picture of pain, the more people want a solution, and the price becomes less important.

Number 3 – Turn features into benefits

Communication is all about words. The words we use are so important. Here’s a technique that marketers use: turn features into benefits. People do not want to buy features, they want benefits.

Let me give you an example. Have you ever said to a client that you will set them up with a chart of accounts, and they’ve come back to you with, “Wow! Really? I’ve always wanted a chart of accounts!” I’m going to guess the answer is no. The reason for that is, the client has no idea what a chart of accounts is and how it benefits them. It’s a feature.

What we must do is develop language that turns features like this into benefits. For every service that you do, tell them what you do, why you do it, and explain the benefits of it, or the pain that you’re taking away.

Number 4 – Quantify wherever possible

Wherever possible, we need to put numbers on either the pain we’re taking away or the value that we’re creating, because when we put a number to it, it becomes more real. Sometimes this is easier to do than others.

For example, if you’re doing tax planning work, you can usually quantify some sort of estimate of what the tax savings will be. If we say to the client, “This tax planning is going to cost $5,000”, their immediate reaction is “That’s expensive”, because we’ve focused the client’s mind on the $5,000.

What we need to do is some calculations based on their business so we can say, “I believe we can save you $20,000 in tax every single year. Over five years that’s $100,000 in tax. Now our fee for doing that is just $5,000.” This is going to get a very different reaction.

We must quantify things. We are skilled with numbers, so let’s put numbers on what we do. How can we measure the benefits or pain?

If we’re offering business advisory, this could be the potential improvement to profit. If it’s compliance issues, it could be how much in penalties we’re saving them. For something like bookkeeping, we have to get creative and think of the different things we are doing. We’re saving the business owner time from having to do it themselves. What’s the value of their time?

Number 5 – Create a system

The final strategy is we need to systemise this entire process. We need to systemise the process of how we build up the pain, and what words to use to turn features into benefits.

We need to prepare and practice these scripts and systems. One tactic is to create a brochure to act as an agenda.

We need to know the structure of the pricing conversation so that we’re prepared to really build the value of what we do for the client.

You can watch the full video on this topic here.

If you found this valuable and would like to learn more about value pricing, I run a free live online training session every month with a topic chosen by you. Attend live and you can ask me any questions you have. Click here to register and I will send you an invitation to the next session.

Wishing you every success on your pricing journey

Mark Wickersham

Chartered Accountant, Public Speaker and Author of Amazon No.1 Best Seller “Effective Pricing for Accountants”