Nailing It 31: How to Price Your Product - Stephanie Campanella

Nailing It 31: How to Price Your Product

Stephanie Campanella
December 12th 2019

Welcome back to another episode of Nailing It with yours truly me, Steph Campanella. Now forgive the audio. For some reason, audacity has had the audacity to not work. And I thought, well I could put this recording off for another two weeks until audacity comes back to me via Twitter and tells me something and rah rah rah. But if you know me, you know that I’m all about imperfect actions and I thought, “I don’t want this content to stop from getting out to you guys because of some audio BS.” So screw it, I’m just going to record anyway. I mean I’ve got my microphone here, my road NT, USB mic, yo, yo, that was a rap. Why not just get this content to you guys? So forgive me if the audio isn’t perfect, but let’s dive in here anyway.

So, what I wanted to talk about today was pricing. So have you ever priced a project and then you won the job, woo hoo, you got paid, woo hoo! And then you did the job and you’re like, “Holy cow, I might’ve got paid up front weeks ago, but this project is just lingering and lingering and lingering on. And I don’t think I’ve even made a dollar from this project.”

So have you ever been in that situation? Have you done a gig, have you done a job, have you delivered something and you feel like there’s no profit? It’s come up a bit short. Now, I was hanging out in a Facebook group and I’ve come to the realization that you shouldn’t be hanging out in anyone else’s Facebook group apart from yourself. But that’s a whole other conversation. And I will leave that for another podcast and the reason why I’m thinking that. But anyway, I was hanging out offering help someone asked something.

And so I sort of started to respond. And the story goes and we’re going to call this lady Marie for the sake of privacy. So Marie posts inside this Facebook group, she tells us about her pricing issue. She said she priced a gig and she thought it was good and then the project ended up having so many revisions, she had to go back so many times and then at the end of it she realized that there was no money in this thing. So then what she did, and this was the crazy part, then what she did was she called a few suppliers in her area and just started trying to get some pricing from other people in the area so that she could confirm within herself that, “Okay, my pricing is too cheap and I need to go up.” Now at that point I’m like, “Damn like girl, you don’t have to call anybody else to get the pricing. What’s going on in the marketplace, what’s the average cost, blah, blah, blah, all this kind of stuff.

That is a last thing you want to be doing. What you want to be doing is coming back to your own business and reviewing your own processes and what you delivered and the boundaries that you put in place regarding those deliveries, and then start looking at pricing. The thing with looking over the fence and the thing with thinking that the grass is greener over there, people are making more money over there is the fact that you don’t really know what it takes to run that business. You see people doing templated or fixed price work, $1,000 here or $10,000 here or whatever that pricing piece is, and you go, “Oh well they do it for $10,000 so I’m going to do it for $10,000.”

But you don’t realize the team behind their business that’s delivering this thing is $20 an hour versus your $125 an hour and then so the scale is just completely off. So if you’re constantly looking over the fence for pricing ideas and then you’re taking that back and you’re implementing it into your own business, you’ve got to stop.

Alright? Let’s all just say, “I will never look over the fence ever again when it comes to pricing my products. I do not know what they do. I do not know their net profit margin. I don’t know the cost of sales. I don’t know what it costs for them to deliver that product. I can only swim in my own pond. I can only run my own race. I can only swim my own lap.” You got to stay in your own lane and make sure that you look back at your own notes, and your own processes, and do your own pricing for your own business.

So if you’ve never delivered something before, how do you price it? Right? Well, okay, let’s put a task list together. What are all the things that I need to… if I was going to deliver this water bottle am I going to… If I’m going to deliver this, what’s it going to take for me to deliver this thing? It’s beautiful. It’s great. It needs a lid. What are all the elements of what you do? What are all the elements of what you do? I say that twice because we just go, “Oh, it’s just this and this.” Well, no, it’s not. In fact, if we spend just a little bit longer here, we can see that there’s, well, this comes before this and then there’s this and then there’s this. I would love for you to sit down 15 minutes, 25 minutes on the Pomodoro clock.

Mangia mangia la pomodoro. I would love you to sit down for 25 minutes and do a quick sprint and go right. My number one thing, my core offer, what is the process of me delivering this thing? Write it down. Make a Trello board. You know how much I love Trello. Put all the cards in place, move them around, make sure they’re all in the right order and work through the whole thing. It’s like baking a cake. I did some cake baking over the weekend and I was at my sister’s place and it was her cake book and my brain was just blown because it was all in the wrong measurements. When I bake a cake, I made sure that I have my electric scale, and I measure the grams and the mills and rararara. My sisters book, Danielle’s book, it had everything in like oz, or like one cup or one third. And I’m like, “I can’t work like this. I can’t put all these pieces together.”

Make sure that when you’re building out your process for your business, it’s like baking a cake because every single step matters. And if you’re going to hand over to a staff member, can you do this for me? Can you put a social media post together for me? It’s like go away. Go and do that. It’s like telling someone to go away and make a chocolate cake. Am I using chocolate buttons? Am I using a block of chocolate? Is it 200 grams? Is it 250 grams?

Is there flour? Is it self raising flour? There are so many elements to delivering your thing. I often get that the story that, “Oh my VA sucks. I tell him to do something and he never does it right.” And I’m like, “Man, you just handed your VA go and make me a chocolate mud cake with raspberry icing.” And then they came back and it was a cupcake. It wasn’t a loaf tin, it was a round tin. It’s like, well you didn’t say that. I mean the cooking and the process building is, so if you think about it from that perspective, you’re literally going to hand someone a note and they are going to build this thing for you like they’re about to cook a cake. And then we’re going to follow the method, and all this stuff that they needed, and then they were going to do it, and then they were going to bake it, and how long were they going to bake it for and blah, blah, blah.

You start to see why maybe your team is failing from a process perspective. So let’s bring us back to pricing, right? Because pricing is why we’re talking about this. This is what this whole episode is all about. It’s about pricing. When we know what needs to be done, if we’ve never done it before, when we know all these key things, we can then start to allocate some time. So 15 minutes to five minutes to open up the browser or 15 minutes to open up this or 10 minutes to do this or five minute phone call or a one hour phone call needs to happen here, all the things. Put a timeline on the task. You can then start to discover, “Okay, so at the very minimum this is what it’s going to take.” Then what you can do is actually deliver the thing, track your time and then come back to your notes and go, “Okay, did this actually take five minutes?” Because it turns out it took a half an hour.

Oh my God. And then you’ll realize that, “Okay, I need to increase my price.” I think if you’re struggling with your value and how you’re pricing and you, “Oh, I’m only worth this much,” then this is a great task for you to do. And just to follow blindly and just to put the number in the box because that’s all this thing is. Pricing does not matter. It is not even the slightest thing. Pricing is just a piece of the whole product and yeah, at some point we need to talk pricing, but it’s just one key factor. It’s not the thing you want to lead with. You want to lead with the value of what you’re delivering, you want to lead with the after effect. You want to lead with the value, the value of what you do and why it matters and why they should work with you.

You want to lead with the after effect. You want to talk about before they were with you and then after they were with you. Yeah. You want to lead with confidence. A 100% confidence provides clarity. When your being clear and your being confident this sale happens. My God, if we don’t like selling things, we’re never going to sell anything. So let’s not get icky and yuck about selling. All right? So never look over the fence when it comes to pricing. Never ask anybody else how they’re pricing their thing. It does not matter. The only figures that matter to you are the ones entering your business. And that’s when people say, “Oh, you got to know your numbers,” blah, blah, blah. You got to know what you’re delivering. You got to know all the pieces of the puzzle and what the key points are and how long they’re going to take.

If you’ve never done them before, make a mock up. Deliver the thing. Opt at your mock up. Deliver the thing. Hey, this is actually now making a much better profit margin. Perfect. If you don’t do this exercise, you are still having a stab in the dark and your pricing will never be quite right, because, it’s someone else’s pricing. All right? So happy listening. Give us a subscribe button if you’re watching on YouTube. Give us a subscribe button if you’re on Spotify or you’re on the iTunes app. I would love to see more subscribers and get you guys making sure that you don’t miss anything else, any other content that’s coming out too. So share the love. Love you guys. All right, ciao.