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Aus Special user Australia 996 Posts |
Hi Guys
I’ve been lurking around the tricky business section for a while now as going pro has consumed much of my thoughts of late. I have seen many interesting issues that many of you have seem too encountered in conducting every day business. However the issue of pricing seems to be the topic of conversation at the moment. There is a number of things I have been thinking about and maybe a possible solution. I’ll give the back ground first. On the thread “Free work = stress+ hassle” Jay Leslie relays a story of a free show where to paraphrase what he had said, that because the event organiser of this particular event was paying the band etc, she refused the reasonable request to move the front row chairs back to allow him to adequately perform his show simply on the bases that one was paid and one was not and the other had more right to being there. Making the argument that the more you are paid the more you are respected. I know this is relation to free shows but I’m guessing this is closely related to the problem that I also have read where magicians have not eliminated there frees completely but lowered them, then have the experience of people cancelling the engagement to later find out they hired another magician for a higher price. Making the argument that customers assume price correlates with quality- in which case, they don’t buy your product unless your price is high enough. Of course the counter augment to all this a magician who is trying to increasing their price to reflect their value of what the show is worth but being suavely effected by other magicians in the market that seem content with offering an equally good show but for a lower price essentially undercutting other magicians and effecting their income. Usually an amateur trying having a little fun well making a few bucks on the side, which leads to the idea that cheap price maybe has the pulling power to a consumer in contrast to the previous arguments. All this leads to my finial question, how much of all these cases are endemic in the performance market and if so how much, and does one cancel out the other in terms of clients that walk through door with ether mind set? After thinking about this for a while I remembered an article from the Magic of Michael Ammer in which he talked about having a safety net built into your pricing. Where after a few proceeding steps and if after trying your hardest you can’t seem to sell your more expensive show your offer another show but of a lesser price. It’s an interesting tactic, because is plays on both side of the fence, if they don’t like the first show because of price they get a cheaper show but if their concerned about the quality of the show then they can always go for the more expensive show. Any marketing book will always say that you will always have an easier time lowering a price then raising it. It really is a game of understanding consumer perception on price. Anyway I would be interested on other people opinions on this. Magically Aus |
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Magic_Steve Inner circle Maryland 1476 Posts |
Huh? Ok, let me break this down to my intelligence. You're asking this:
Since some cusomters equate price to quality, does that mean you should charge more so the customer believes they're getting a better show. VS. Other magicians selling a lower cost show because they're not doing it professionaly, just looking for a few bucks. If that's the question, then here's my answer. It all depends on your target audience. I'm sure you've heard this time and time again, but here's how it relates to it, in my opinion and from what I understand your question to be. You're talking about 2 totally different groups of people. One group concerned with price, and another concerned with quality. Obviously, the upper classs families are going to be concerned with getting a quality show, and thus equate price with quality. Think of it like this. Would you be more comfortable buying a Porshe for $5,000 or $50,000? When you think Porshe, you think expensive. If you see an expensive item going for dirt cheap, then obviously you also think something's wrong with it. On the other hand, you have a group of people that's mostly concerned with price. They're not shopping for a great magician. They're just looking for an "average" magician, one that can do a decent job for a cheap price. If they find another performer for $20 less, guess which one they're going to hire? I'm pretty sure you already know. So, it all comes down to what you want, and who your target audience is. If you're looking to work the big gigs in a high class area, then of course people are going to equate quality to price. But then again, you just never know. That's why it's best to get as much info beforehand, to give a proper price quote. And if this is way off base, and nothing like what you're looking for, my apologies. I actually had a hard time understanding your question, as big words normally confuse me? Best, Steve |
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jay leslie V.I.P. Southern California 9498 Posts |
Hi Aus.
The question basically is: If you charge more, will you get more work. The answer is no. The oppisit can also be stated that if you charge less you won't end up any better either, after running around and other expenses. There are 7 different ways you can sell something.... anything. Asking, Testomionals, Incentives, Penalitys, Inverse pricing, Assumption and Negitivity (as best as I remember). Studying those sales methods will allow you to offer prospective customers the best deal for both of you... after all, everything is relitive. I come from the school of thought, to ask lots of questions about the event before I offer one of 11 shows - then give the price. For example: It's a restuarant gig so you offer them a discounted price (as an incentive) because they are booking you multiple times, OR They are calling from Beverly Hills so you have a pricey show because (inverse pricing) appeals to them.... because you are going to present tricks and illusions that you "just don't see" in other parts of the area. I didn't invent the seven ways to sell. My father was a very good salesman who taught me at an early age. Idealy, you want to include as many reasons for the buyer to "bite" as they can handle. A Day Care may only care about price and that's what you present to them. The best deal is the one that's best for both parties. The rest is numbers. If you were on the phone all day calling prospective customers - some may NEVER use you, some will use you simply because you are alive and they have a slot to fill. It's what you do with the people between those two groups that makes or breaks you. The bottom line is: You can only offer people up to three benefits and/or features, Price, convienince or service.... If you have the reputation of performing the best show... then price is no object.. If you are the local guy that shows up on time with a reasonable price then you'll probably be busy... assuming the show is decent and your advertising is adaquate. See... It's simple. Just do the best show you can and charge aproximatly what other people charge with the same credentials as you, and then work your way up.
Jay Leslie
www.TheHouseOfEnchantment.com |
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Aus Special user Australia 996 Posts |
Ok let me simplify it for you.
Customers won’t more for less and customers won’t more for more. Do you play your price down to get more customers or do you play your price up to portray value in order to get the same thing. They just seem to contradict them selves but yet people seem to say they have had success with ether situations, but I can’t see them working in the same environment together without one affecting the other. Not to mention the disadvantages of each approach: More for less= Less perceived value from your customers point of view (I get what I pay for), for hope that you get more bookings on your part. More for more= Sell your show at a higher price to indicate value, but as a result may push work away from you to a cheaper competitor. How much of this stuff is true in the performance market, which is the better way to go? Well I’m saying all this I’m talking about two acts of equal quality by two different performers but one applying the more for less idea and the other with more for more philosophies. SO really we are talking customer perceptions here, so which is the write path when setting your price? I understand the whole target market thing but I’m sure no matter what market you’re in you will have competitors that do the same as you. Just seems to me a dammed if you do dammed if you don’t situation. Magically Aus |
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Dannydoyle Eternal Order 21219 Posts |
Here is the real trick.
IF you can do X amount of work for Y amount of time then great if you are happy with that. IF you UP your price and the bottom line goes DOWN, then guess what? You made a poor price point decision. IF you UP your price and the number of shows goes down but the bottom line stays the same, you are missing out on a whole bunch of stuff more important than money. Possible contacts made at additional work, and needfull stage time. Here is my MAIN problem. You are breaking down your show and your value to simply a function of pricing. This does a couple of things bad in my opinion. First off it sells you ONLY on price and anyone with a better price can take the job immediatly as this is the relationship you have set up with the client. Second of all it does not allow for YOUR PERSONALITY to be the deciding factor in the purchase and what you can offer, just what you cost. Now in the markets I am and have always chosen to be in, my price is not relevant. They are happy to pay what they pay and think nobody else but me can provide what it is I do. It is about a relationship with the customer in the end. ALL sales is relationships. You are selling you. I have said this time and again. Make them think only of price and they think only of price. Try to get them to concentrate on why they are hiring you. If it is a function of price only then expect to be replaced and do a lot of one time jobs.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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TheDean Inner circle Reno, Nevada 2164 Posts |
BINGO Danny!
Selling on price alone makes you a commodity and there is zero leverage for delivering what your individual client relationship wants, and better yet deserves! In my experience and with those I know who are at the top of their game as well as those I have coached along the way... "Your Raise Is Effective When YOU Are!" Though not a popular opinion from those who don't believe or understand what we are saying; You are WORTH what you are willing ask for and then actually deliver in terms of real and perceived value! Ask ANY of the top earners in our industry if what I am saying is true... Joel Bauer, Jeff Hobson, Mac King, Anton Zellman and soooooooo many others. Some will get it, others will not, it is just a fact of life and this business. Thinking of YOU and your Success! I am at your service and In HIS Service, Dean <><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success! "Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…" (*Marketing Doctor) |
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Donald Dunphy Inner circle Victoria, BC, Canada 7563 Posts |
Hi Aus -
This older post of mine might be of help to you, too. It's from a couple of months ago. - Donald
Donald Dunphy is a Victoria Magician, British Columbia, Canada.
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Paddy Inner circle Milford OH 1571 Posts |
Aus, when I went full time a few years ago I called up every magician and got their price. Then I put my price noticeably higher than anyone else. Well a few calls backed out when I told them how much but I was booking more than losing.
When someone said "I can get X cheaper" I responded "he knows what his show is worth and I feel my price is right for what you get." I was booking ablou 85% of the callers. I feel that people do think that quality has a price and they are willing to pay for it. I do get a lot of reperat bookings so it works for me. Peter |
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jay leslie V.I.P. Southern California 9498 Posts |
The other axiom I like to follow is: Go where you are special. So I book shows out of town and become - The expert from afar. Many people have a diminished view of your worth if you live two blocks away as opposed to bringing in an expert who "must be better" because this is a special trip for them. Go figure.
Jay Leslie
www.TheHouseOfEnchantment.com |
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TheDean Inner circle Reno, Nevada 2164 Posts |
Hey Jay,
Isn't that a strange and funny perception??? Sad and unfortunate fact that "PERCEPTION" is reality in the minds of our buyers and I USED to be faced with that same "perception" since I WAS the (perceived) 'expert form out of town' when I came to Reno & Las Vegas. Even when I MOVED HERE, I maintained my 'out of town' address and phone number (for MANY reasons… including my past relationships!) and was getting more work than all the locals! Was I "better"? Not really, just not local I guess... (and I’m guessing to part of the perception…) NOW, (Today) for me at least the perception is (after much proving and hard work) that for what I do and whom I serve, I am the ONLY go-to-guy they use. Again... am I necessarily the BEST locally or from afar??? I don't think so! (I certainly deliver a TON, but there are better performers than I am!) Heck, mark & Jinger live right here is Reno now and still I am as busy as I want to be. (Also, I sold 98% of my big illusions anyway, cuz I am 90% “EnterTrainer” [speaker/trainer/trades show marketing] and 10% magic guy anymore…) Again… win, loose or draw, it all about “perceptions” regardless of the TRUTH of tha matter or how we “feel” about any of all that. Can we help to influence “perceptions”? Absolutely! – It is now how I make my living! And like anything else, it requires effort and effectiveness. …and the arty plays on! Thinking of YOU and Your Success! I am at your service and In HIS Service, Deano in Reno <><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success! "Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…" (*Marketing Doctor) |
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gadfly3d Special user 963 Posts |
Here is a bit of economic theory-Things don't HAVE value in themselves. Value comes from the needs and desires of consumers as it relates to the supply of means to fulfill those needs and desires.
To raise ones fees because on is better misses the point-the issue is can you more effectively fulfill the demand, if so you can command a better fee. If you are thinking of turning pro the issue isn't what to charge but rather what can you do for the consumer, and who is that consumer? Particularly, who has the kind off money to spend that you want to make. This may well mean repositioning yourself (note the number of magicians who have become speakers) in order to accommodate the market. Its also true that wherever you go their will be competition-the answer to that is be better, easier to work with, more unique-price is way down the list. or should be and if it isn't you are in the wrong market. Gil Scott |
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TheDean Inner circle Reno, Nevada 2164 Posts |
B-I-N-G-O!
Brilliant Gil! Thanks for the reminder! - - You’ve seen me say a million times: "The More VALUE You Create, The More Money You'll Make!" our only real job is to SERVE the wants needs and desires of our relationships! Again, NOT a technique, but rather as a "way of being". Others have said the same thing in different ways as well… PRICE is rarely and issue if you REALLY SERVE the highest outcomes of those relationships! (Even LESS of an issue if you over deliver for your Trusted Friends!) Thanks Gil! Thinking of YOU and your Success! I am at your service and In HIS Service, Deano in Reno <><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success! "Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…" (*Marketing Doctor) |
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AntonZ New user Canton, GA 52 Posts |
Dean,
I realize that this thread began a while back, but I am just now catching up on reading the terrific posts here about Corporate work, Fees, Presentation, etc. I'm finally finished with my efforts to launch my New Web site and get my Zellmann Knowledge products up and running.... well... mostly. May I just add one other thought here about Pricing. It's a couple of paragraphs from a telephone interview that Randy Charach did with me when he was first about to launch his very successful, Million Dollar Millionaire eBook quite a few years ago. Randy Charach– "So, Anton, what I understand you to say, is that what is required to earn fees in the higher end of the scale, is a combination of a quality performance, a good strategy to be perceived as different and better than the competition, a winning mind set, the courage to take risks, and excellent promotional methods and materials. I am gong to ask you for some specifics on how to actually put those materials in front of the decision makers. First though, I often hear from some of the entertainers that hire me for consulting that their market just simply does not bear these higher fees we are talking about. What’s your take on that?" Anton Zellmann– Well, it’s important for me to understand that if my thinking is that I am worth $500, then I will bring to me those clients that can afford $500. And, unless I provide them with additional benefits, additional gratification, then I will ‘show up’ as a $500 Mentalist. If on the other hand, I think of myself as a $1,000 guy, I will still bring to me the $500 clients and some of them will say no. But, I will also bring to me a number of the $1,000 clients. This same mindset operates in the higher fees as well. And there are many levels of paying clients. So, if I believe, for any reason, that my market cannot handle higher fees then that will remain my truth! It’s a limiting way to think and it will bring me limited results. I think it’s important to realize that unless I choose to differentiate myself from the pack, and truly recognize the value of my product I will not be able to ask for and consistently receive substantially higher fees. Sure, every performer wants their numbers to change upward. Well, as I’ve already described, the best way I know to make the numbers move upward is to place a value on each and every service that I offer. |
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Dannydoyle Eternal Order 21219 Posts |
One way to do this, and again sorry about an old thread, is to offer them something they think they can not get from anyone else.
For example the thing that keeps and gets me 90% of the clients I have is simple. PEACE OF MIND. They know what quality they are going to get, they know it will go off pretty much without a hitch, and if there is one I will handle it. It is about relieving headaches, ESPECIALLY in corporate work. If a guy can count on you and knows it 100% EVERY time he has to book talent, well then you have made his job easier, made him look fantastic to his bosses and allow him to concentrate on his ACTUAL JOB. Which is the idea. Offer "Peace of mind", (not GIVE them a PIECE of your mind) and you will never be out of work. It is tougher to establish these relationships than simply selling on price, but you end up with a loyal followinig.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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AntonZ New user Canton, GA 52 Posts |
Danny Doyle,
How are ya... how are ya? Hope all is going really well for you. As we both know from previous conversations we think alike on many aspects of business and in particular... the wonderful and lucrative world of corporate business. Many years ago, I developed a conversation that I almost always used as I concluded my exchange with a new prospect... either on the phone or in person. It went something lie this. "Name, You can count on me to get the job done... RIGHT every time! I realize how busy you are with all of the meetings, phone calls (today I would add emails and time on the Internet)and other details that go into your job. So know this, I will not add to your headaches. You can ALWAYS count on me to cover all of the details... every time. And if I screw up... not that it happens often... I'll know it before you do and it will be handled appropriately. Just provide me with what I need to meet your objectives and go back to your other tasks. I'll take care of every detail and I'll never fail you. In fact at the end of this event... you can count on your boss telling you... this was terrific and it went without a hitch. GREAT JOB... Truth is that you'll want to contract me for many years to come! Now, of course, I didn't say this when I first began this marvelous occupation. It was a few years later when I understood the values that you Danny, point out so well in your post. A few months ago I came across a small box full of microcassettes that I had recorded as I was interviewed by potential clients, agents and current clients. These conversations covered the details of how I marketed myself and how I strategized with these folks. I was elated when I discovered them and I quickly added these 16 audio conversations as a BONUS (Gotta love the Internet Marketing language) in my Course. It's almost like going on a sales call with me. Danny, do you think that this may be a good stand alone CD to offer to those who check in here and may wish to get started and/or excel in the Corporate market? http://www.zellmannuniversity.com |
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TheDean Inner circle Reno, Nevada 2164 Posts |
Anton, Danny...
Dare I say it again??? B-I-N-G-O! This is more professional MIND-SET than anything. (We all seam to agree on this… like duh! – Hehehehehehe!) Great share... Thanks! Thinking of YOU and your Success! I am at your service and in HIS Service, Deano, back in Reno <><
Dean Hankey, *M.D. - The Dean of Success Solutions!
Serving & Supporting YOU and Your Success! "Book More Shows... Make More Money... SERVE MORE PEOPLE! - Not Necessarily In That Order…" (*Marketing Doctor) |
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Dannydoyle Eternal Order 21219 Posts |
I think ANY reputable sales strategy would be usefull, and a niche not filled in our industry.
We see SO many people who tell us how to sell on PRICE and PRICE alone. It is sad actually. I tout sales courses such as the Xerox PSS Features and Benifits course. BUT actually seeing how things are sold to clients would be quite valuable I think. I also came to the information by the long road. The only problem is it takes time to sell this way.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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Bob Sanders Grammar Supervisor Magic Valley Ranch, Clanton, Alabama 20504 Posts |
As an old marketing professor, I believe that price is actually less than 25% of the marketing mix, although we taught undergrads that the mix was Product, Price, Place and Promotion. It is not what I teach MBAs.
In consulting, pricing problems are usually signs of needing to start over. In practice we adjust the price down to keep sales high enough to interest a new business buyer to acquire the SBU (complete business) from us. We usually increase advertising too to generate the sales. (It also tends to take the profit out of the sales but accountants spread the ad costs over all SBUs and disguise the actual costs of sales. Profits for the SBU are systematically overstated through accounting. In really good businesses accountants are not on the management team. Yet there are accountants who do retrain to become management. If they can graduate to think outside the box, they can be valuable.) Changing customer base is usually wiser than adjusting prices downward when you are the producer. If you are the seller, there are always budding producers who think they can produce the same product for less. Of course, most fail. There is a great difference between being fair and being desperate. There is no future in serving a market that can’t afford you. That’s a gift, and not a business. Someone always pays! Good Luck! Bob Sanders Magic By Sander |
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Dannydoyle Eternal Order 21219 Posts |
Wow "Someone always pays".
THAT could be a thread my friend. Your last sentence should be put as a stickey!
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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Bob Sanders Grammar Supervisor Magic Valley Ranch, Clanton, Alabama 20504 Posts |
Danny,
"Someone always pays". It is a reality that is easily missed when the amount is not stated, cash is not transferred or it is OPM (Other Peoples' Money) and resources. It has dropped the US economy from #1 to #14 in world economies. In terms of life expectancy, the US ranks #42 and ranks #49 in literacy among the members of the United Nations. Medicine in the USA is about 30 years behind medical practice in the advanced nations of the world. Knowing who pays is VIP! "Investing" and "spending" are not the same. Consumption invalidates production. Someone Always Pays! Consumption and production are separate functions. "Public" is often interpreted as "Free". It certainly is not! Resources are certainly consumed. The question is: Who furnishes the resources? Cost is also not value. Price should be related to value. The value should exceed cost. Otherwise the resources have been misused. Remember that to an economist, starvation is a natural death! Bob Sanders Magic By Sander |
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