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Value is something that every one wants. It doesn’t matter who you are or where you’re from, you want to be of value and to feel valued. In business value is a very important concept. The perceived value of your products and services by your target market will contribute largely to your success.

Think of what amount of money you would place on your worth as a human being. The word that comes to mind is priceless. Now think of the amount of money that you would value your business in terms of one lump sum. I’m sure you could probably think of a ball park number based on your last years sales and guess at an amount. Now try this, think of a number that your customers would place on the final outcome they would achieve after buying your product or service if that thing had somehow changed their life. What valuation would you put on that? I bet the word that comes back to mind would be…priceless. You know why? Allow me to tell you. When people experience life-changing results, they can’t put a dollar amount on it. They begin to use terms that elicit thoughts of limitless value along with the perception that money simply can’t buy.

As an entrepreneur, whether you have a service based or product based business, you must value what you bring to the table. You must know your worth. And if you know your worth, you will not be tempted to constantly discount your products and services. It’s important to realize that when you consistently discount your offerings you are hurting yourself more than you are helping yourself. In the short term, you might sell more quantity but the quality of your customer base will suffer. And in the long run, you will be positioning your brand and business for less than what you perhaps bargained for. Not to mention the fact that you will probably work a lot hard for the cheaper sale than you would for the higher end sale.

When you focus your entire marketing strategy based solely on price, you run the risk of reaching budget shoppers who only want the less expensive option and don’t really care about much else. Word to the wise, as a small business owner you can’t afford to compete on solely on price. There will always be someone cheaper. That said, I want to offer you a little insight about why it’s important to know your worth and the real value of what you are selling. More importantly you you must truly understand the major disadvantages for discounting your products and services.

Of course there are many disadvantages in regards to habitually providing discounts on your offerings; however, I believe the top 3 are listed below. Read on and tell me what you think in the comments.

1. You Devalue Your Products/Services.

When you constantly discount your offerings, it is hard for the consumer to find value in it. The practice of offering discounts without any stipulations, in essence means you are planting the seed in the mind of the consumer that whatever you are offering is not worth the original price. Therefore the potential consumer believes the value is not there and will decide to wait until another discount offer comes back around.

2. Position your brand as the cheap option.

Your brand image has everything to do with the consumers’ perception of your business. If your brand is perceived as the cheap option within your niche or industry, it will be difficult to overcome this stigma. In addition, the cheapest brand is typically not considered to be the best brand. Being perceived as the cheapest option is not an advantage unless you want to compete solely on price. In that case, you should be targeting low income buyers who are budget shoppers because 9 times out of 10 that’s exactly what you will get. Remember what people think of your brand when you’re not around is governed by your reputation and the image they hold of your brand essence.

3. Run the risk of missing your revenue goals.

Every business should have multiple revenue streams and various products and services that sum up the potential to achieve the target sales goal. It will be very difficult for you to achieve your annual revenue goals if you are discounting your products or services all the time. There should be some revenue streams in your business that are never discounted or reduced. It’s important to offer price options for various client types. If your offerings range from high to low, there should be ample options for your customers to choose from based upon their budget and buying prototype. (Learn more about pricing your services here.) If you have done your pricing research ahead of time, your pricing should be in line with you the industry average and somewhere in the middle to high end versus your competitors. You will stand a better chance of making the income and hitting your revenue goals if you price your offerings fairly, offer incentives for your products and services.

Now that I’ve outlined the disadvantages of discount your products and services, I hope you will begin to reposition any savings that you would like to pass on to your potential customers as incentives or special sales for a limited time. Remember, when you provide a quality product for a fair price, the right customers will pay. People are willing to pay for top of mind problems to be solved for a fair price.

Now I’d like to hear from you. What issues have you run across with discounting your offerings? What did you learn? Share your experience in the comments below. If you have questions, feel free to contact me.

 

 

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Lori A. Manns is an award-winning, marketing, sales coach and business strategist who works with small business owners to help them elevate their brand, get more clients and grow revenue. Lori A. Manns is CEO of Quality Media Consultant Group and founder of the Trailblazer Business Academy™ where advancing entrepreneurs go to learn business growth strategies the soulful way. Lori is also the creator of Sponsorship Sales Secrets System; ™ that shows you how to get more sponsors and sales for your business, guaranteed. To purchase consulting services on marketing, advertising or sales and, learn how to increase your revenue and grow your business; please visit the small business solutions page on www.qualitymediaconsultants.com.