The Marketing Word | Differentiation Marketing

Cost, Price and Proving Value

Sometimes all the stuff swirling around in my brain (yes, like the proverbial running toilet) comes together and I realize that I’ve been storing information, waiting for a few more pieces to fall into place resulting in a flash of brilliance – or at least a strong boot in the pants.

A trip to a new dentist was the final chunk in a puzzle that had been swimming in my head for the past week.  It started with a Bob Burg seminar on referral marketing (His book Endless Referrals is a marketing classic – if you don’t have it, get it.)  Bob does perhaps one of the best Zig Ziglar impressions in the speaking industry and he tells a story about overcoming the objection of cost.  When a prospect says that your price is too high, Zig says to respond with “Are you concerned about the cost or the price? Because price is a one-time thing and cost is a lifetime thing.  Don’t you really want the best possible, lowest cost?”

Another way of saying that is, “You get what you pay for.”  You can buy a cheaper item, but will it last?  Will it cost you more in time wasted on future repairs or replacement?

Now for my trip to the dentist.  I found this dentist through an ad in a local free magazine.  They have a number of locations and a very large full-color ad.  I had a first time visit for a checkup, cleaning and x-rays.  The office had a lot of high tech equipment and every patient area (not individual rooms, which made me glad they weren’t gynecologists) had a huge 50” flat screen HDTV.   The dental tech did the x-rays and some checking, the doctor came in and poked around for five minutes.  Turns out my beautiful smile is hiding some gum disease, a cavity, a crown that needs replacing and all sorts of stuff.  In fact, by the time they were done talking with me, I was scared my teeth were about to fall out of my head.  FORTUNATELY, they had this really nifty software that gave me a computerized printout of all the recommended work which came to somewhere in the neighborhood of $8,500.

Once they had worked me down off the ceiling, and I had worked out several things I could do with $8,500 (rehab a kitchen, buy a used car, spend a month in a villa in Italy with a twenty-something pool boy), I told them I might be back but I needed to get two more estimates.  (Hell, I was a rehabber, I ALWAYS get three estimates for large jobs.)

But here’s the real problem:  I didn’t have any trust in this dentist – it was a first time visit.  The dental tech caused me physical pain while the estimate caused me physical, mental and emotional pain.  They used fear tactics, which may or may not be justified, as a motivator.  And they asked for a not small amount of money.  Now, in the grand scheme of things, $8,500 for all that dental work may be a great price.  But for someone planning to spend a few hundred dollars, it was a bit of a jump.  (And I would still rather spend the money on a villa in Italy and a pool boy.)

Here’s where it fell into place for me:  I charge a lot of money for what I do.  Not as much as some people; not nearly as much as others; but more than average.  I am very good at writing manuals and courses for people.  I am fortunate in that most of my clients are referred to me and that I have built a good reputation in my particular niche industry. HOWEVER, if you do not know me or my work and you hear my stated price, your heart may skip a beat or two.

The trip to the dentist pointed out the flaw in my own marketing and positioning.  The work I do is extremely subjective.  It takes me, on average, 4-6 weeks to create a manual for someone.  I write manuals in a narrative style.  My manuals read a bit like novels. I do my best to capture my client’s “voice” and they are written in very “me to you” tone.  I have a system that I use and it creates a solid product.  But, there is the chance that the client won’t like the work I’ve done.  It’s very subjective and as in many things, when it comes to writing, beauty is in the eye of the beholder.

So, as a marketer, how do I justify my price and prepare my clients for what their end result will be?  It really comes down to communicating my expertise and the time involved and this is where I think the dental office made its mistake.

There were no testimonials from patients anywhere in the office.  No pictures of the dentist (any of them) with a happy teenager on the day she got her braces off.  There were no diplomas on the wall (if I had seen an Ivy League diploma hanging on the wall, at least I would have known I was paying off some school loans).  No articles about the doctors or the office.  There was NOTHING in the office that told me why this dentist was different from any other dentist in town and why his prices were at least twice as high as other dentists.  In fact, I had the distinct impression that the dentists rotated through the various offices much like temps.

I’ll pay for quality work.  So price really wasn’t the issue.  I like my teeth; I want to keep them.  But there was nothing in my experience in the dental office that made me feel like I could trust that I was getting top quality dental care, care that was over and above what I could get literally across the street for a lot less money.  In fact, I will not be sure I need all that recommended care until I see a second dentist.  My trust level with that office is non-existent.

When you are selling anything, especially high ticket items, you need to build trust with your prospects and build value into your presentation, be it a web page, an ad or face-to-face.  What makes you different from everybody else out there?  Do you have references (testimonials) from credible third parties?  What are the future costs that you will save people down the road?  How does using you (and paying more money) benefit your client in the long run?  Until you can answer those questions, your prospects are going to shop you on price.  Learn to speak in terms of cost, not price.

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4 comments

  • Bob Burg · 11/13/2010 at 3:36 am

    Excellent article (with typical numerous dashes of Barbara Grassey humor sprinkled throughout)that really did a terrific job of pointing out the Dentist’s marketing problem…and the solution. And, it’s advice that all of us in business would be served well to heed. Thank you, Barbara! (And, of course, thank you for the kind plug of my book. Very kind of you!)

  • Carole Sanek · 11/14/2010 at 4:18 am

    Excellent – I had a similar experience – went to a brand new dentist, my estimate was higher than yours – I cried. I actually cried. That’s BS marketing – “Fear Marketing” and I walked out called another dentist, had an exam worked out a plan and I want to say even with crowns and some insurance I spent about $4000. They wanted to do veneers, a bridge, told me one tooth was unsalvagable – not true.

    Dentistry is one area where they can “rip” you off – but in any high price estimate regarding health – I say “2nd Opinion” – get one – it’s worth it.

  • Admin comment by barbarag · 11/14/2010 at 10:09 am

    Thanks Bob! I’d steal your book again in a heartbeat. 😉

  • Admin comment by barbarag · 11/14/2010 at 10:13 am

    Poor baby. I knew there would be an upsell and I actually knew what they would “find” as the problem (disclaimer in their ad) but the jump in price was too big to bridge without any third party recommendations. I also realized I could get the dental work done in Costa Rica, throw in a month long vacation and a face life and maybe even a tummy tuck for the same price. I like to explore options, the more creative the better!

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