Several days ago I wrote a post Expensive is Better than Cheap When it Comes to Pricing where I talked about my preference for focusing on the best experience knowing that it’s almost always more expensive as well. There’s another corollary to it that can be disconcerting to pleasers that look to make people happy: being expensive means saying “no” to many prospects.
It’s so hard to generate leads and when someone comes calling, as an entrepreneur, it’s difficult to not get so excited that you throw up all your great information on the person. But, then, pricing comes up and the prospect wants everything you have, only at a much lower price — a big let down. When offering the best possible service, and therefore commanding a higher price, leads have to be turned away.
Looking around, many of the best services are also the most expensive in their class:
- Amazon Web Services – the most expensive cloud computing platform is also the best and most sophisticated (I recommend it to all tech entrepreneurs)
- Rackspace – the most expensive managed hosting company has the best customer service and people, so you get what you pay for
- Regus – the most expensive office suites at a cost typically 2.5x the equivalent space in the same building, but the ease of becoming a customer, number of locations, and consistency of services in unmatched
Now, sometimes prospects do come along that are a good fit in the long-term, but don’t have the cash in the short-term, and there are ways to address it. Some companies offer special pricing for startups, many colleges offer scholarships, etc., so there are ways to have a premium product and still accommodate a handful of key customers. Being expensive still means saying “no” to many prospects.
What else? What are your thoughts on having a premium product and saying “no” to many leads?