Your Move: The Underdog’s Guide to Building Your Business by Ramit Sethi

Author:Ramit Sethi [Sethi, Ramit]
Language: eng
Format: epub
Published: 2017-06-18T22:00:00+00:00

Notice how it’s not apologetic? And how it’s not a high-pressure sale? He’s just saying, “Hey, I put a lot of work into this thing. For the right people, I think it’ll be valuable. Check it out.” That’s all selling is.

Pricing is Strategic

Many of us think that we just arbitrarily choose a price, slap it on the product, and it sells. In reality, it’s much more sophisticated than that. Let me show you:

Take a fast food restaurant like McDonald's. McDonald’s doesn’t just choose $1 to $2 for their products randomly. They are one of the most sophisticated pricing technicians on the planet.

Because once they decided to go in at the low-cost entry option, everything around their business became focused on supporting exactly that.

What does that mean, “support the low-cost entry option”? It means, foolproof machines that untrained labor can use. It means documentation for everything, for when to flip the burgers and how much of a soft drink to pour. When you first start working at McDonalds as a 16-year-old high school student, all this documentation needs to be written in very clear language.

McDonald’s also pays low wages. Why? They can’t afford to pay more because of the margins they make on their products. They have built their whole business around a low-cost model, and it works very well for them.

Let’s take another brand on the opposite end of the spectrum: Louis Vuitton. Louis Vuitton sells high-end handbags and fashion at high prices. We’re talking about thousands of dollars for a handbag. They didn’t just randomly choose that — pricing is part of their strategy.

It means that they have better material than a handbag you might find at TJ Maxx or Ross. It means that their material is handmade. So it’s not just better material, but the products are actually handmade. At Louis Vuitton, they have better trained staff. They have different branding. You’ll almost never see discounts or promotions, ever.

Pricing isn’t just the sticker price. It informs your entire business.

Most people price out of fear. They just choose a price which is usually way lower than they should charge, and then they hope that no one notices they’re actually charging money for this product. Your pricing signifies who you are and what kind of customer you want.

“I talked to the first friend and floated the idea by them. I said I’m looking to coach people 1-on-1 through every step of [a specific niche]. From finding an idea to writing it and driving traffic to it. Everything.

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