7 Key Questions to Help You Assess Your Pricing Strategy

Welcome to Live With The Pricing Lady.

I'm Janene, your hostess.

This show is all about helping you build a sustainably profitable

business while making an unbelievable impact on your world.

Learn from my 20 years of experience and from my guests as we discuss their pricing

challenges, failures, and successes.

Pricing is a way of being or behaving in your business.

My mission is to help you confidently charge for the value you deliver.

Pricing is either hurting or helping your business.

Let's make sure it's helping you reach your dreams.

In this episode of Live with The Pricing Lady, we talk

about starting strong in 2025.

I'll give you seven key questions to help you assess your pricing

strategy to make sure you're getting off to the right start this year.

Sit back, relax and enjoy the episode.

Welcome to Live with The Pricing Lady.

I'm Janine Liston your hostess.

Super happy to have you here with me today.

In this episode, we are going to be taking a look at how to

start off strong in a new year.

Like this 1 20 25.

We're already well into January.

And for some of you, you may not have taken the time to take a

step back and take a look at your pricing strategy and decide whether

or not changes need to be made.

This is a really important step because of your business has moved

forward and your pricing has stayed the same chances are you're not

charging the right prices anymore.

I've got seven quick key questions that will help you to

assess your pricing strategy.

So you can make a more informed decision about what, if any changes are needed.

Let's dig right into the first question.

So the first question you're going to ask yourself is what is changing

or has changed in my business.

Now, if we're talking about this chain in the context of the last

time you looked at your prices.

So that could be just a year ago, a few months ago, or it could be many

years ago, depending on your situation.

And here's the catch.

Almost every business decision you make will have an impact on your

profitability and pretty much always have an impact on your pricing as well.

Or maybe it should.

The important thing is that you stop for a moment think about that change.

Ask yourself.

Should that have an impact on my pricing and then do something if needed.

For example, if you're going to go with a new go-to market strategy, so maybe you

decided working with private clients isn't as where you want to be, that you actually

want to work with business clients.

And therefore that's a different go to market strategy.

You're going to go get those customers in a different way, and that could impact

something like your customer acquisition costs and therefore change your prices.

Or it could be that they have a higher willingness to pay.

Then maybe you could also change your prices there.

So these are the types of things that you want to be thinking about.

If your costs have been rising, that's another change in your business

that definitely could affect your pricing, or you could just let affect

profitability depending on the case.

But if you're right, if your costs are rising, you're definitely going to want

to take a look at your pricing strategy.

So there are many different decisions that you make in your business.

Let's say you hire a new employee.

Do you need to adjust your prices or do you need a new pricing category

for, you know, that type of employee, if you're in a service-based business

or if you're in a product based business and you change where you're

manufacturing is going to be done, that can also affect your pricing strategy.

So think about the changes that are happening in your business, or that have

happened recently in your business and how that might affect your strategy.

Let's take a look at question number two.

Have my target customers changed.

Yep.

This is a real big one.

Now I use that in the example before, but it's relevant here because customers

can change for many different reasons.

You decide to broaden your market.

You decide to shrink.

You know, reduce the number of target clients you have, you decide

to shift from one to the other.

So there's lots of different ways in which your customers can change.

As a group, but then there's also what's changed in terms of how they

value your offer or what they're looking for in terms of a solution.

So if we think back to COVID right, so many people.

Started ordering more food for delivery.

And that changed for a lot of people in the gastronomy industry, how they were

delivering food to their customers.

Right.

And of course that also may have changed who their customers were.

So originally there were customers who were people who, you know, usually just

ordered in for convenience, but now their customer base grew significantly

to include a lot more people who probably have different preferences and

needs than their previous customers.

And they had to think about how to adjust the pricing strategy for that as well.

So think about, have your customer.

Targets change or have their wants and needs and desires changed as well.

And take a look at that in the context of your pricing strategy.

Question number three.

Is my offer changing.

So whether you have a product, a software or a service.

Your offering.

Yeah, I put all of those in the offering.

Will.

Undoubtedly evolve and change over time.

And sometimes you decide to add more value sometimes.

You will decide to take value away.

Sometimes you'll decide, Ooh, I need something in the middle of

the two offers that I already have.

And those sorts of changes mean not only will the prices of your existing

portfolio change, but that you may, let's say you put, add something in there.

Well, that may impact.

What you charged for the other things around it.

So you want to look at your offering on an individual basis, but then

not look at it all together to make sure that it still makes sense.

Sometimes when we add a new offer into one place, all of a sudden

the price or something else doesn't look correct anymore.

And you need to decide whether or not you're going to make an adjustment there.

Question number four, does my value proposition align with my prices?

Now again, you want to make sure that over time as the value of what you're offering.

Evolves and is what's.

Your customers are looking for evolves as well.

That your prices are aligned for that.

So it may be at one point in time, your customer base didn't value.

Speed.

But something shifted in the market and now all of a sudden they want

to get whatever they're getting from you as fast as possible.

And so if your value proposition.

Shifts.

If you choose to ship it or shift it, or if your customers shift in their

thinking, then you're going to want to adjust your pricing strategy to keep

those things aligned with each other.

So your value proposition and your pricing strategy should always

be working in harmony together.

Course.

Oftentimes, what happens is when people don't change their prices

or at least review their pricing strategies to look for when there are

opportunities or needs to make changes.

Then this gap arises between their value proposition and their pricing.

And as time goes by and no changes are made, that gap

just increases and increases.

And then there comes a point where it's so mismatched.

That you have to make big changes and that's when changing

your prices and adjusting your strategy can get really scary.

So you want to avoid going down that path.

Question number five are my prices aligned with what my customers are willing to pay.

Again, Customers change.

The people themselves, or it could be their wants, needs,

and desires change too.

And you need to keep saying one ear to the ground, if you will, to understand

what they are willing to pay and to make sure that you're aligned with it.

Now in my free web class or on demand web class called getting to a fair price.

I talk about the three elements of a fair price.

And they are one that the price has to be reasonable enough that

enough people will pay for it.

Two that has to reflect the value of your offer.

And three, it has to be profitable enough that you can earn a living from it.

Right?

And so those are sort of the three requirements for what a fair price is.

But often times when people aren't aware of what their customers are willing to

pay or not paying attention to that.

That deviates once again.

So we're trying to find sort of this sweet spot where between those

things, where the value is recognized, the willingness to pay is aligned

with being profitable as well.

Let me say one thing about aligned with what my customers are willing to pay.

Part of understanding that is regularly talking with and

listening to your customers.

Have conversations with them and uncover what they value most, what

they're willing to pay more for and what they see as unique in your offer.

Because those three things will help you be able to fine tune your pricing

with insights straight from the.

The customer's mouth, if you will.

Question.

how do my prices fit in the marketplace?

You want to make sure that you have prices that are appropriate for the marketplace.

Let me be clear here.

I didn't use the word competitive for a reason because when we use the word

competitive, most people see that as, you know, having a price that's

cheaper than everybody else or about the same, so that I'm not too far out

of the market, but here's the kicker.

That may not be the target group you're after that may not be the

value that you're trying to deliver.

So if the main.

Thing that your customers are looking for is the cheapest price in the market.

Then being competitive is being at a position lower than everybody else.

If you want to , deliver medium value for a medium price, then

that means you're going to be matching some of your competitors.

If you want to position yourself delivering other types of value,

say speedy delivery, or it could be a very customized experience.

Then your pricing and where you fit in the marketplace is probably going

to be above many of your competitors.

So that's why I am very cautious about using the word "having a competitive

price" and instead "focus on having a price that is positioned properly

or well in the marketplace", because those are two very different things.

So ask yourself, am I positioned as a premium, as a

value or as a niche offering?

And how does that fit into the marketplace?

Does my price positioning reflect those things?

Question number seven.

What pricing habits or policies need to change.

This is a big one.

And here's why.

So most businesses when they set, price increases for the following year.

For example.

If you go to year after they've made the increase and you look at the actual

increases that they've taken on or kept over that year period that usually end up

almost always end up being significantly lower than the increase they plan.

And why is that?

Bad habits and poor policies.

And if you're in a, so if you're a solo entrepreneur, then it's poor boundaries

would be a good interpretation.

What I just said there.

Old habits can undermine even the best pricing strategies.

And so it's really important for you to take a step back and look at what you've

done over the past year and be like, okay.

Where were my weaknesses?

When did I cave?

And did it really make sense or could I have handled that better?

Do you feel compelled to offer discount when the first objection arises?

Or do you even find yourself offering discounts before

you're presenting the price?

Or maybe you're constantly trying to find creative ways to lower your price?

So that it feels better.

When you're making that offer to customers.

Now, those are behaviors that are going to be undermining your pricing strategy.

And so it will behoove you to take a seat, sit down and have a look at this and

make sure that any habits or boundaries or policies that you have that are not

being handled in the right way that you have a plan for improving upon them.

Or changing them could even be that you change it outright.

Instead of saying, okay, I only give five discounts a year.

You say I'm giving none full stop this year.

We're discount free.

Right.

There's lots of ways to handle it, but you need to figure out where things

aren't working and then adjust from there.

So those, my friend are the seven key questions you can ask yourself.

To help you assess your pricing strategy and if any changes are needed.

I hope you enjoyed this episode before you go, let me bring up one more thing.

So the next cohort of the customer compass is starting on February 10th.

This program is all about helping you become the expert in your customer by

conducting customer insight interviews.

I help you understand who to target with those interviews, how to

approach and ask for the interview.

What to ask during the interview, how to conduct it in the most successful way, and

then how to start using the information you get from those customer interviews in

order to help pricing in your business.

And let me be clear.

It's not just going to help your pricing.

It will help so many other aspects of your business.

When you get crystal clear on who your customers are and what they really want.

So head on over to The Pricing Lady dot com backslash the customer compass

and get yourself registered today.

Thank you for listening to this episode of Live with The Pricing Lady, the podcast.

If you enjoyed the episode, rate, review, and subscribe to it, then share

it with your friends and colleagues.

I love hearing back from you listeners.

If you've got comments, questions, or topic ideas, go on over to thepricinglady.

com and contact me there.

Not sure where to start when it comes to improving pricing and profits?

At ThePricingLady.

com you can download a copy of my Self Assessment Pricing Scorecard.

Find out where it's going well and where you can begin improving.

Or just simply book a discovery call with me.

There we can discuss what's up with pricing in your business and

how I might be able to help you.

Thanks once again for joining.

Remember, pricing can hurt or help your business.

Let's make sure it's helping you reach your dreams.

See you next time and as always, enjoy pricing.