Stop Underselling Yourself with Robin Waite: An EOFire Classic from 2021

0:01Boom! Shake the room, Fire Nation. JLD here and welcome to Entrepreneurs on Fire. Brought to you by the HubSpot.

0:30fearless and confidently charge more dollars. The value bombs, Fire Nation, you don't always have to follow the crowd. You can charge as much as you want and be fearless with your pricing and so much more. And a big thank you for sponsoring today's episode goes to Robin and our sponsors. Imperfect Action, hosted by Steph Taylor, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Imperfect Action is a bite-sized online marketing podcast for business owners who want to get straight to the point. Join Steph Taylor as she answers all your business marketing questions.

1:01Recent episodes include five must-knows to sell your online course, program, or membership, and four steps to grow your email list for your next launch. Listen to Imperfect Action wherever you get your podcasts. Robin, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Oh, what's up to the Fire Nation? Yeah, so my tip to kick things off with is around going against the flow. So a lot of the time when people start up in business, for example, they're told to go and look at the competition and follow and do exactly what they do because that's where success lies.

1:43And for me, I've always pretty much done the opposite of what everybody else does and created enormous success as a result of it. So don't always follow the crowd. You can always go in the opposite direction from time to time. I like that Mark Twain quote, which is, when you find yourself on the side of the majority, stop and reflect, because there could be a reason that you are, and it might not be a very good reason. So Fire Nation, as I shared about at the beginning of this episode, we're going to talk today about stopping underselling yourself. It is time to just simply stop underselling yourself, Because if you're hearing my voice, you are likely underselling yourself.

2:24And let's just get right into it, Robin, because pricing is just a major issue for so many people. I mean, it's probably one of the top questions I get when I'm speaking to podcasters or just entrepreneurs in general about their course, their podcast or sponsorship or whatever it might be. Why do people end up just pricing their stuff to their competitor? And why is that a bad idea? The reason why it's a bad idea. So imagine if you're as a local service provider, I don't know, let's say, for example, you build websites for a living. There's probably like 20 different web designers in your local area.

2:57And Steve's looking at what Dave's charging. Dave's looking at what John's charging. John's looking back at what Sharon's charging and Sharon's looking back at Dave. And the reality is none of those people are actually pricing experts. They're all kind of looking at each other, kind of thinking, well, the other person must know what they're doing. So charging the same as what everybody else is charging is often one of the biggest mistakes. And the right way to do it is to, I mean, I'm not suggesting don't go and look at your competitors because there is some gold which you can pull out of there.

3:26But the mistake is assuming that what they're doing is right when actually it might be the wrong thing to do. So we recommend that the first thing that you should do is actually look at the goals you set for your business and identify economically how many products do you need to sell in order to achieve your ideal turnover within your business and then use that as a marker for how much you're charging as a starting point. um and and and also the other thing to remember as well is that you know out of those out of those 20 service providers that are out there in terms of your competition um you you've only ever got three choices when you price your products you could you could go in at the cheapest because that's how you think you get clients you could go middle of the road because you don't want to be perceived as the cheapest but also you think that if you're too expensive that will that will repel people away from you uh so you you kind of go middle of the road to be safe but there's always one person out there in your industry who is the most expensive.

4:23And there's a few clues here. So they're the most expensive, but they've probably been around for the longest. They've got the most Google reviews. But somehow, whilst they're being the most expensive, they're still able to get clients. So it's not even really profound. It's just, it's like really obvious. You can be the most expensive and still run an incredibly successful business and pick up clients. Fire Nation, there's a lot of things that Robin just went through. I hope you're really going to chew on because, you know, it's, it's a tough gamut. We're not going to say that this is easy. If it was easy to price everything, then everybody would be doing it perfectly in this world.

4:58We, you know, would be an interesting place. I'm not saying be better or worse. It'd just be more interesting. And there's a quote that I think really resonates here, which is a Seth Godin quote, which is the problem with the race to the bottom is that you just might win. I mean, think about that. Like, if you're just like, I'm just going to go lower, lower, lower, where I'm going to be the lowest. Well, the problem with the race to the bottom is you just might win. And is that really a race that you want to be winning? Now I'm going to be really expounding upon all the things that Robin's going to be talking about as we continue going through this process of stop underselling yourself.

5:32But I want to start with a very strong word, unethical. And you use it very strongly, Robin. Charging by the hour is fundamentally unethical. Expound upon that. 100%. And this is one of the more controversial things which I say, and I have people divided over this and sort of banging on my door. So, yeah, I strongly believe that charging by the hour is fundamentally unethical because – let me give you an example. Okay, John, you're going to have to be my stooge for this. You're going to have to bear with me. Yes, I love being a stooge. Right. I'm going to stick with the website analogy. And by the way, I used to run a website design business years ago, so hence the reason why I come back to that.

6:12But you're in the market for a website. so Steve comes along he's going to sell you this website it's going to take him about 20 hours and he's going to charge you 50 bucks an hour is that cool cool so he goes away what he forgot to tell you was that he's not terribly good he hasn't been doing it for very long his websites don't look great he's going to go away for three months because he's so busy because he sold too many cheap websites so he's so busy eventually comes back and he says John here's your website and you go that's crap that's crap where's the blog where's the shopping cart it doesn't look very nice it's what results is that going to get me?

6:44So, so, so he then says, well, oh, the blog. Yeah. That'll, that'll be another 10 hours, uh, 50 bucks an hour. And you've got to pay for it. Is that okay? No. Now, most of us are ethical, moral, upstanding human beings, and we wouldn't just bump up the price, but now you're annoyed, John, Steve's annoyed and everybody's a bit, there's a lot of resentment kind of building up here. Okay. Now on the flip side of that, we've then got Sharon, right? So Sharon, um, she's an absolutely kick-ass developer. She is brilliant, right? But she doesn't know what Robin knows about pricing okay so Sharon says listen I'm going to build your website take me about three weeks but I can pretty much guarantee it's going to get you three to five leads a month uh you know add infinitum I'm pretty confident my ability is to deliver it's going to get found on Google and things like that so Sharon goes away and she she builds it in half the time as Steve um and so yet she builds a better website but she's only going to get paid$500 for that so that's the second shift.

7:38It doesn't really add up that she's better yet she gets paid less than the guy who's not very experienced. Now, the third person comes along. Okay. So we've got, we've got Roger, right? Roger knows his worth. Okay. Roger comes along and he says, John, right? I'm going to build your website in three days flat. Okay. I can guarantee that in the next 90 days or by the the end of the next 90 days, it will be delivering 10 to 15 guaranteed leads for you each and every month. And I'll tell you what I'll do. I'll give you my prices in a second. But what I'll do is, if we get to 90 days and it's not delivering those leads, I've just said, A, I'll give you a refund, but I'll also pay you$1 ,000 for wasting your time.

8:20Is that cool? No brainer. Absolutely. It's$10 ,000. Is that all right? Yeah. If you're going to give me those leads, I'll do it. 100%. So you can see that like now we've done the flipperoo. Roger gets great results and outcomes and they're guaranteed and he's willing to put his money where his mouth is. And so whilst he's 10 times the price of the other two, you just get much better results off the back end of it. Fire Nation, I hope you're really absorbing this and maybe thinking about, hey, how are some ways that I can apply this to my business? How are some ways that I can guarantee results?

8:55Or if I don't get those results, the money goes back. But I know because of my skillset, because of my expertise, I'm going to produce, I'm going to give those results. And then guess what happens? That next level of thing happens, which is referrals. People become your evangelist. You know, they start saying, you just have to use this person. Like, yeah, of course they're a little pricey, but I mean, think of what you get long-term. You get the best, like that's what you want. And this just comes to one of the biggest concepts that I'm such a believer in, which is people will beat a path to the doorstep of the best solution for their problem.

9:29If you can identify a real problem in this world and become the best solution to it, you will have people beating a path to your doorstep. If you're the second best, they will ignore you because people want the best. They want the best solution. So how can you do that and then wrap it up in this thing that Robin's talking about here? So, Robin, anything you want to end on this area before we move on? I work a lot with coaches, consultants and freelancers and people like that. And unfortunately, you know, what they make up for in certifications, unfortunately, they lack in basic business skills.

10:00So I see a lot of coaches, for example, who come out, if they do their International Coaching Federation certification or whoever they trained with, and they're kind of like shoved out the door with a message, which is, hey, go and charge 50 bucks an hour and get your first three clients. And actually, it sets a really bad tone of like struggle for them, unfortunately, like when they first start out. So I guess my message for anybody listening to this, if kind of that's you, there is a better way to start to think about how you charge for your time and really got to get solidly focused on the results and outcomes you deliver.

10:33Another way of putting it is productizing your services over hourly rates. So focusing on having a product, productizing your service over just the hourly rates. So expound upon that. Yeah, 100%. So the productizing of a service happens in a couple of steps. So the first thing is, so take a therapist, for example, and working with therapists is quite hard work because there's an ethical side to this where, according to their code of conduct, they're not allowed to offer guaranteed results. For obvious reasons, you're working with the mind, the body and things like that, which are, you know, unpredictable at the best of times.

11:14So I'm going to work with therapists because they're a hard example to work with, which probably isn't the wisest thing to do. I don't know. But the first step, though, is imagine if you had a therapist and you said to them, well, listen, and they're working with something, I don't know, like stopping smoking or I don't know, some kind of transformation, basically. I always ask the question on average and average is the keyword on average. How long does it take for you to get the desired outcome or result with your clients? and quite often you'll get something which is like well you know 12 weeks okay and so then you say okay well how many hours are you actually what how much do you charge per hour currently and they might say something like 50 bucks now okay so the first part of productizing a service is actually to kind of package up those 12 weeks that average number of sessions and then multiply it by the hourly rate and get used to selling that first so now all of a sudden now we do a 12-week transformational program, which is$600, for example.

12:09And I always tell them that then we move into step two, which is to right now you've got to get used to selling packages to go out and pitch the next 10 people a$600 transformational process. And then invariably, they come back to me, I've taken hundreds of clients through this invariably, they come back to me and they say, well, actually, we've we've sold three out of the 10 at the 600 pounds. And you know what, robin i've already put my prices up so this is the point where now hourly rates are a thing of the past they're focused on this transformational progress which is happening over a predetermined period of time uh the outcome is predictable because there's a step-by-step process and it's for a fixed fee and the beautiful thing is when you've now that you've got that fixed fee um you can start to experiment with that so if you pitch 10 people at 600 bucks we'll go and pitch the next 10 people at 800 bucks or 900 or 1200 bucks depending on your your level of confidence and your um you know and and the number of leads and inquiries which are coming into you at that point and invariably the conversion rate actually doesn't change that much they go and pitch the next 10 people and they get two three or four people signed up so we put the price up again and we just it's a really neat way of just um incrementally increasing the prices you know you don't just go out there and charge five times the amount, albeit some clients have done, but you kind of gradually just work your way up after you've productized that service.

13:30Fire Nation, this is a whole new and different way of thinking about these type of things. And again, I just really hope you're saying, hey, how can I apply this type of thought, this type of process, this type of system to my business? And if you think Robin's even close to being done dropping value bombs, you got another thing coming because we're going to be talking about increasing prices, discounting. We'll talk about some insights in the money mindset as well as soon as we get back from thanking our sponsors. If you're a startup with big goals, then it's important to find a CRM that can keep up, but I get it.

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15:46That's promo code FIRE at fieldofgreens.com, fieldofgreens.com. So Robin, we're back and let's be honest, we all do want to charge more, but let's get specific about how we can increase our prices, increase our rates. Cool. So again, you're going to have to be my stooge for this, John. So we're going to have to try and maybe if you don't have an example, maybe work with work on a client or just make something up. Okay. So let's say, for example, we've gone through the productization process on one of your products. So give me an example of a product and then we'll work around that. Let's use one of my old products, Webinar on Fire, where we would teach people how to create and convert webinars.

16:31Okay. So, and how much does it, does it cost to sign up to that? $500. Okay, so$500. So you and I both agree that that, John, that's way too cheap, okay? It's too cheap. Way too cheap, right? So we both agree. I've sown the seed of an idea, John, that you need to increase the price of that program, right? Yes. Okay. Now, if I went straight out there and said, right, John, go out and charge 5k for it, what would your immediate thought be? No one's going to buy it. Nobody's going to buy it. Okay. So I could guarantee that some people would, John, because you're john lee dumas however let's let's pretend in this world that 5k is just too outrageous that's a 10x price point okay but what we do is we're going to rewind a little bit and we're going to start at that 500 pound price dollar price point and i'm going to do a little dutch auction with you okay i'm going to gradually increment that price and when you get that knee jerk reaction that gut reaction and it's a bit like that's the point where we're going to stop and have a little chat.

17:27Okay, so bear with me. So we'll start at$500. So$600,$700,$800,$1 ,200,$1 ,500,$1 ,800. God, you're pretty brave. $2 ,500. Okay, right. John, go out and pitch the next 10 people at$2 ,500 because you're just outside your comfort zone. So that's a safe enough space for you to confidently get out there and start pitching at that increased price point. Fire Nation, you know what? All the magic happens outside of your comfort zone. Not inside your comfort zone, outside of your comfort zone. And what do you have to lose? Like, give this a test, give this a try. I mean, it actually works for me. That means I'm making 5X on every single sale.

18:11And so what if I only sell like, you know, like 10 or 12, like less per month? Overall, I'm making way more money because I have 5X'd my prices and gone to a place that's, hey, I'm actually being able to test this market now and see what people are willing to pay. And if I come up with goose eggs for the next couple months, I mean, that might be telling me something and I drop it back down, but I'm probably not going back down to 500 because now that seems way, way too low because now that I've been outside of my comfort zone, I kind of like how it feels out here. And another thing that you hate, Robin, is discounting.

18:47Why? If you go out into the marketplace and your prices are too cheap, you're accidentally discounting without even really realizing it in the first place. So that's the first thing to bear in mind with this. But what most people don't realize is that they think if they just offer, say, for example, a 5 % discount on their same product or service. So we offer discounts in order to introduce or artificially increase demand for our product or service. That's why most business owners offer discounts, okay? But if we discount by 5%, most people assume that you've just got to sell 5 % more in order to make the same profit in your business.

19:23but actually the numbers are stark. So over here in the UK, we've got an organization called the Chartered Institute of Management Accountants, terribly exciting. And they did a study and they looked at all of the businesses throughout the UK on average and worked out what the average gross profit margin was in those businesses. And they worked out that by the time, if you offer a discount, by the time the money falls down through the profit and loss account, i.e. in expenses and overheads there's like a compounding effect which happens so if you offer just a five percent discount you've actually got to sell 14 percent more of the same thing in order to make the same profit and you can then keep on sort of ratcheting that up so a 10 percent discount means you've actually got to sell 22 percent more of the same thing in order to make the same profit and then by the time you get to about a 30 or 40 percent discount you've actually got to sell more than double of the same thing in order to make the same net profit so discounting can be incredibly damaging for a business without people really realizing it it's the same reason as well why on the flip side if you increase your prices so if you increase your prices by say five percent well actually you can afford to have 14 fewer clients and still make the same amount of profit and the numbers keep on going up that way as well like the the perfect business for me actually when We live in this world where we've got the internet knocking on our door and in our pockets all the time.

20:49It's a global marketplace at your fingertips. And everybody's out there marketing like crazy. Well, actually, I believe that a good business is one where you've got half the clients and you're making double the profit. Fire Nation, I mean, think about these numbers. This is really eye-popping. I never would have thought that a 5 % discount could equate to a 14 % and less revenue. I mean, the numbers just keep compounding and getting exponential. And I think a lot of this, Robin, has to come back down to, you know, people and their struggles when it comes to money mindset. And I think that you probably deal with a lot of money mindsets, which is why, you know, some people struggle having their rates at reasonable places or increasing their rates to, you know, that kind of uncomfortable zone.

21:31Because there's just some real money mindset issues out there. So can you give us some insights into money mindset? We're born with several different blueprints. And I'm going to caveat this because I'm not a psychologist necessarily, but I'm an avid enthusiast. And I read a lot about sort of psychology and various things like that. And especially around mindset when it comes to entrepreneurs and business owners. And one of the really stark ones is that our financial blueprint, our money blueprint is actually instilled in us by the time we're sort of around about three to seven years old. And I've got two daughters.

22:06I've got a seven and a four year old daughter. And I don't know about you, John, but like when I was three, I could bet my girls, they could barely count at three years old, let alone add up. And also like there was no real concept of a fair value exchange. You know, all I seem to get off my girls is daddy. Can I have this? Daddy, can I have that? So yet when we then turn into grownups and we then rely on this blueprint to rule how we handle money within our businesses. So like some of the common things which I hear is I've got a cash flow problem, right? And most business owners don't ever really have a cash flow problem because cash flows into the business and it flows straight back out the other end of the business.

22:46The problem they've actually got is making more money and then keeping it. And so that's one of the first things. And the reason why our money blueprint is installed in us at such a young age is like, you know, 99 percent of us aren't born with a silver spoon in our mouth and, you know, tons of money. So, you know, invariably our parents would have been arguing when we were little around things. We can't go on that holiday. We can't afford it. We can't buy that car. It's too expensive. You know, you can't have those shoes that you want and you're there like staring at your mates trainers and they're really cool and you want them.

23:19They're too expensive. You can't have them. And so throughout our lives, when we're kids, we've had all the scarcity like just pounded into us. And unfortunately, many adults like we have to spend it takes years to kind of unpack that blueprint and start to give it a more positive blueprint. And, you know, one of the ways to look at this as well is many, many sort of people in business have this very emotional attachment to outcomes in their business. So if you're very heavily focused on sales, for example, and somebody says no, they, you know, oh,$2 ,500 for this, you know, this amazing program, which John is doing, that's too expensive.

24:00And John, you know, you might, you could choose to take offense to that, you know, fear of rejection. That's what's going on there. And the reality is like in business, like what's the worst that can happen? You know, no actually isn't that bad. You might lose a bit of face. You may not make the money, but the world still spins around. And so a lot of the time people sell products too cheaply because it's like Pavlov's dog. Every time they sell a product, a little bell goes off in their head. The reticular activator system kicks in and says, oh, that's a nice feeling. I'll keep on selling cheap products because I sell them more often.

24:36Not realizing the damage which it's doing to your business for the reasons we talked about earlier on around discounting and things like that. and then if you sell products that are more expensive you have to wait a little bit longer you've got to be more patient you're going to get more rejections because your conversion rate might be slightly lower but you have to wait a little bit longer for the yeses and i hate to say it but and it's in part because of what the internet has created over the last 30 years this like this uh this on-demand world where we get instant gratification for some reason we expect that that is how business works and we've lost our ability to be patient and actually the business owners who um i think have the best the most uh or the best success which we see externally obviously are the ones who have developed this innate ability to be patient um to to wait for the sale to the right prospect to come along at the right price at a price point that is economically going to stack up for their business and make them profit.

25:36And so what happens here is rather than being on this cycle where we're doing sell, deliver, sell, deliver, sell, deliver at cheaper price points, the moment you start charging more money, you have more time to deliver a better quality product, which produces better results and outcomes and produces more money on the back end. And the whole world, imagine it's like, imagine John's at the center of this universe. And if he's not pricing enough, you know, if he's not charging enough for his products, the sales cycle of doom, as I call it, is like going sell, deliver, sell, deliver, sell, deliver.

26:08It's like a gravity field around John. But if you have the confidence just to step into your, you know, understand your worth and your value and slow that process down, it's like that gravity field just expands. and we charge a little bit more we have more time to deliver a better quality product get more money at the back end before we then have to focus on where our next client is coming from you know and i have i have this uh um we actually kind of have a mantra fearless business which is slow down create space and charge your worth i even had it printed on a coin which i send to clients which um to remind them um just to like if they find themselves on this frenetic cell cycle of doom they're doing it wrong and they need to just slow down.

26:51Slow down, create space, charge what you are worth. If you're doing those three things, Fire Nation, your life is getting better. So Robin, you shared a lot of awesomeness this entire episode. Break down the one key takeaway you really want to make sure Fire Nation gets from everything that we talked about here today. Give us a place that we can go to find out more about you, any call to action you may have or a gift for Fire Nation, then we'll say goodbye. I think people have probably got the message by now, you know, be fearless with your pricing, just be really brave. And if you're struggling to understand your worth, then do go and speak to a coach, doesn't have to be me, but go and speak to a coach about how you can find creative ways to charge more for your products and package them up.