Customers Vote With Their Credit Cards
I had two exciting discussions this past week with my coaching students: two different scenarios, the same topic, same logic.
When you are considering selling products or services, one of the first steps I recommend is to test if your idea will sell. I have a whole process to test and implement ideas, but I wanted to give you a quick rundown of the logic behind how to test new and existing offers.
Let’s get back to my students. Jessie is already selling a service, the other one - Domi - is considering selling a physical product.
Let’s talk about the service scenario first. The question that was asked was, “how much should I charge for it? I’m thinking $10k, but I fear it is too much”. $10k is not too much or too little as it is all relative and depends on the context.
For example, if I told you to pay $10k for a box of matches, you’d call me insane and walk away (unless the box was made of gold). But if I told you to pay $10k to make $200k in sales, I know you would jump on this offer. And that is precisely the situation Jessie was in.
The value Jessie brings to the table is ENORMOUS, and all the client needs to do is pay her $10k to make $200k in sales (it’s an ecom store). So that was the first thing we talked about - what value does your product or service bring to the table and is the client willing to pay that. In this case, NOT spending $10k to make $200k would be insane.
Now, if you have never pitched $10k in your life, asking for this kind of money seems scary. And in your head, you might be asking questions: “what if this is too much”, “what if they refuse”, “what if they go somewhere else?” To which my answer is - people vote with their credit cards and you won’t know HOW they voted until you let them. So don’t assume they won’t agree. Don’t decide for them. Pitch them and see how they vote.
Now, the second scenario is a lower ticket, $29 physical product. We’re running a product-market fit test to see if anyone will buy the product. The question from Domi here was - should I invite people to a waitlist, or should I let them pre-order the product?
My answer was - pre-sell. The reason is simple, and you already know it. People vote with their credit cards. I have seen so many times prospective customers signing up to a waitlist and then not purchasing sending downright confusing and wrong signals about the potential of the product. But when you offer a pre-order, even at a discounted price, you will get votes and answers from real customers. And if you’re worried about “what will I do if it turns out it is not a good product-market fit, and I don’t end up manufacturing/selling it”, the answer is simple. One word: refund.
Remember: people vote with credit cards. Pitch them and see how they vote.
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Mike "votes with CC" Koziol