You are listening to My Freedom Grove podcast with Gretchen Hernandez, episode 74.
Welcome to My Freedom Grove podcast. The all inclusive podcast that teaches mindset and business tools. We'll help you rise as your authentic self. Be unshakable with your emotional freedom and unstoppable in achieving any goal and living your purpose. I'm your host, Gretchen Hernandez. If you want to put your mental health first in life, relationships and business, you've come to the right place.
Hey there, my strong friends. A few episodes back, I told you that I was doing an experiment with batch recording my podcasts. So this is number three out of that experiment. I decided three was more than enough to record all in one day. I'll give you updates next time as to how it went with all of the editing. That part was going to be one piece flow, editing one podcast at a time, all the way to completion.
So some pretty exciting stuff happened yesterday. I learned that Corinne Crabtree is offering an Advanced Weight Loss Coach Certification program. She picked my podcast as one to come be interviewed on. Unfortunately, I missed the window to schedule her, so it won't happen with this round. But, that is promising that she will be my guest later this year. For those of you that have gone through the Life Coach School certification, I'm sure, you know of Corinne Crabtree. If you're in The Life Coach Self Coaching Scholars, you definitely know who she is. And of course, if you're just out and about, if you've ever been interested in weight loss, you know who she is.
She is what I like to call life coach royalty. Everybody that's in the life coaching industry knows who she is. She is just a rock star. She's full of energy. She's got her own style. That is just...I love it. Anyway, she has done really, really well for herself in this industry. And it's all been based off of a low cost membership business model. I believe at this point she only charges $59 to get into a membership for weight loss. In the life coaching industry You'll notice that there are all sorts of different prices.
That's what this episode is going to talk about: Price Drama. As I help you develop your products and services, the question of price always comes up. There's always concern about:
What if I price it at something that nobody's willing to pay for.
How do you make any money doing this?
I had people ask me that too. They look at my Unshakable memberships, which are only $149 a month. And they're like, how can you make any money? How can you keep a roof over your head? If you're offering something for such a low price.
There are some life coaches that will do their one-on-one packages and it'll cost like $10,000 - $25,000. I mean, seriously. That's a lot of money. That's really hard. When I first started out, there was no way that I would be willing to come up with that kind of money. Now that I'm further into my entrepreneur journey, I can see the value if it's with the right coach. As long as they are helping me to get that kind of value out of my coaching and in my business, that's totally worth it for me. There are certain personal struggles that are definitely going to be worth that kind of money also.
There's also an accessibility thing. There are people from every socioeconomic background around the world. We have the opportunity to work with people online. So there's lots of people that will be coming our way, wanting our help. People with really huge hearts like us, we just want to help people, right? It's like if we could work for free, we probably would forever. Because we love helping people. But we do have to keep a roof over our head.
And if we have some larger aspirations for our business, bigger things that we want to be able to do, we have to be able to fund those activities. So for example, I'm eventually going to be hosting some wellness retreats and some business retreats out here on the Mendocino coast. It costs money in order to get the retreat up and going. There's a whole facility fee. There's the publicity. There's the extra help you need. Staffing to be able to do all of that. All of the materials, all of that costs money. So at some point I have to make that revenue so that I can invest it upfront. Sure there's ticket sales. That will cover the cost of that. But I have to put money out first.
So in your business, you're going to experience that too. There's going to be things that you need to spend money on first, before people end up paying for your product or service. So how do you make that money? Well, you have to do that through charging for your products and services.
You may end up with just one product or service that you offer. You may have several. If you have several, they might all have different prices attached to it. I mean, even when you go into a restaurant, there's all sorts of different prices. And depending on your occasion for going to that restaurant, you might go in and go, yeah, I'm just going to get the soup for tonight. Because I'm just kinda hungry. All I'm looking to do is just fill up my tummy, get warm. That's all I need. I don't need anything else. I don't really want anything else.
But there might be other nights where you're like, yeah, bring on that T-bone. I want the good stuff. Or bring on the lobster because I really want that. I'm craving it tonight or I want to celebrate. And I like to celebrate with really good steak and really good lobster. Well, for me, it would be crab. I love crab. I love lobster too, but I love crab even more.
Anyway, there's always going to be a variety of things on the menu. In your business. You can have a variety of things on your menu too. And sometimes people are going to want just the soup off of your menu. Sometimes they're gonna want the lobster off of your menu. Just as long as they're coming to your restaurant. That's a good thing right now.
If you price all of your stuff really low, that's fine. They can come and they can get that all the time. But if you want to stay profitable, you have to at least know your price on your different things. And you have to know the quantity of those things that you can sell. I like to anchor down on the term "Minimum Math Number."
I use this in a lot of different contexts. We can use this to describe your operating costs and your living costs. What are your minimum math numbers that you have to have to cover the absolute basics? Then what are your aspirational goals? I mean, of course we'd all like to eventually make a good amount of money so that we don't have to worry about money anymore. That we always have enough to cover anything that we want to do.
That minimum amount. What is that minimum amount? Because you don't want to stress out. You want to be able to live your life, enjoy your life and show up for your clients with really good energy. Knowing what your minimum number is and how can you meet that minimum number, as long as you have that, the rest of it, you can breathe easy.
The rest of it is all aspirational that you can work to in any timeframe that you want to set for yourself. So once you know that minimum math number, how are you going to get that?
So you're looking at your different products and services that you can offer. You already have an idea of either the number of clients that you can serve at one time, if you have a one to one model. Then you're going to have a maximum number that you can take at any given time. Because again, you always want to put your mental health first. So don't overextend yourself. We don't want to burn you out. That's not the point of becoming an entrepreneur. So what is the right number of clients that you can handle with your product and service? Once you have that and you know your minimum math number, then it's just division to figure out what the price would be.
Minimum Price = Minimum Math Number / Maximum Number of Clients
Inspirational Price = Inspirational Math Number / Maximum Number of Clients
If the people that you want to serve really do have a lower price point, then you may want to consider doing a one to many model.
Course (Digital or In Person).
You attend and have multiple people attend for a smaller fee. You're multiplying the fee by the number of people. You're still just showing up for that certain amount of time.
You'll be able to get your minimum math number that way by knowing the price point you want to have. What's your minimum amount? And then you can figure out how many people you need to have in those chairs.
# Attendees = Minimum Math Number / Set Lower Price.
In order to meet that minimum math number, one of the other things that helped me was to think about the market. There is a market for all of the different price points. Our heart might be set on helping one segment of the population. We forget that there's a whole other segment of the population that also needs our help. And it's okay to help those people. Or maybe you figure out something very creative in your business model where you can help both.
I learned from another podcast, I wish I remembered the name of it, but I just listened to it once. It was super helpful for me, it broke down the market concept by talking about crackers.
Crackers are just flour and water. It's just something simple. There's a cracker for every market. You can go to the dollar store and you can get a box of crackers for a buck. You can go to the fancy grocery store and get a box of crackers for $20.
It all depends on where the person is at the moment. In what market do they want to shop?
There are times that I love the dollar store crackers. I like going to the dollar store. Because sometimes there's stuff there that I actually want. Does it mean that I can only afford to shop at the dollar store? No. It just means that sometimes I want to go to the dollar store and get the crackers there.
Sometimes I like to go to the fancy market. When I was in Vacaville, there's one called Nugget. I had never encountered a fancy grocery store before. It was so nice. When I went into that grocery store, I felt so good about myself. I felt fancy. I was willing to spend the extra money on their groceries. I mean, it's the same crackers. Sometimes it literally was the same package of crackers. It's just being sold in a different market. In the fancy market. But I felt fancy being there. I was willing to pay that price. It's a perceived value (of myself) thing.
There's also the fancy boxes of crackers that are going to sell for $20, no matter which store they're in. Again, it's just flour and water. Okay, seriously, they'll throw in a couple extra ingredients like Rosemary and stuff like that, but it's a fancy cracker. And sometimes I want a fancy cracker. Maybe I'm getting ready to have a party at my house and I want to have some fancy appetizers. I'm probably not going to go for the saltines. Even though the saltines are really good crackers. I love saltines. But maybe for that party, because we all want to dress up and get fancy. Like let's say it's a new year's Eve party and people want to dress up and get fancy. They're gonna want some fancy crackers. So I'm going to be willing to go and spend $20 on the fancy crackers that day.
Even if I go to a regular old store like Safeway or something, I'm willing to buy the $20 crackers. Your products and services are going to fall at a different time in people's lives. You might want to have a little bit fancier product and service that costs a little bit more because it's going to help people to feel fancy by going to it. Make sure that whatever value you're delivering as part of your product and service is worth, whatever they're paying for it. In fact, I highly encourage you to, over-deliver. Always over-deliver because they're going to come away every time with their mind blown thinking, wow, I can't believe I got all of that for this price.
You can choose how they feel about interacting with you. If you price your stuff as the dollar cracker variety, they're probably going to come in just thinking, okay, it's a dollar cracker. If I don't get any value out of this, okay, that's fine. Because it was just a buck. But if they come in and you're the $20 cracker variety, they're going to come in knowing and also expecting that they're going to feel great and that they're going to get at least $20 of value out of it. So don't disappoint. Don't overcharge for your product just because you're trying to make people feel good or because you're trying to make money.
Although if you're just trying to make money off of people, you're probably in the wrong place. I'm probably not the person you want to listen to. I'm all about taking care of the people. And of course we want to make income, but I am not a money first kind of person. If you're a money, first kind of person, we're not a good match.
So over deliver for the people. Always give that to them. But think about that in your pricing. It's okay to charge a little bit more. As long as you're giving all of that extra. There's always someone out there that is at the right point in their life that will want it. It doesn't mean that they can afford it every day.
There are wineries out here. I'm out here in Northern California. I'm on the Mendocino coast. Napa valley is only a couple of hours away from me. Tons of wineries. In fact, there's wineries out here in Mendocino county also. But the Napa valley wineries are world famous and they're gorgeous. Oh my gosh. You're not going to show up in grubby sweats to go to these things. You are going to dress up fancy. You're going to feel great for going to it. You automatically feel like you have a different status because you're going to it.
It's going to cost you some money. It might not be something that you go to every weekend. You might be willing to go to the grocery store to go get a bottle of wine every weekend. Maybe you go to Trader Joe's. Go get $2 bottle of wine. My mom always called that two buck chuck. That's perfectly okay. You know some people, that's their regular routine. It's just a bottle of wine.
Going to the fancy winery is going to cost you more than two bucks. It's going to cost you a lot more. But you're going to feel fantastic. Getting all dressed up, getting your hair done. Maybe it ends up being a social thing. You grab someone else to go with you and you go feel fancy together doing this. You're going to have a great time. It's still just wine in a bottle. Okay. You can obviously tell I am not a wine connoisseur. I enjoy experiences. I'm not someone that goes, oh, this wine tastes so good I'm willing to spend a thousand bucks on it. I just, I've never really developed that side of me...to distinguish all the stuff with wines.
I love the experience though. Going to these fancy places and getting dressed up and having that experience with my friends or sitting there in the courtyards. So usually there's gorgeous vineyards and rose gardens and manicured landscaping and marble countertops. And you get to sit there with the summer breeze. Hopefully it's more of a spring breeze, so it's not super hot. That you get to experience that and it's worth the money just for the experience.
So consider that when you're designing your product and service. What experience are you giving to someone?
Are you giving them your regular run of the mill? You do this every single week, it's boring. And we're just like in a warehouse somewhere. Or, are you giving them that fancy vineyard winery experience that makes them feel like a million bucks?
There is a market for everybody, for every price point and at different points in different people's lives.
They're going to want these other things. They might save up for it. There's also creative financing for things. We worry a lot about people just not being able to afford it. Sometimes they really can't. But there's creative financing.
I mentioned a few podcasts back about a local nonprofit that has access to grants. They can apply for grants. They want to help people that may not have the funds to be able to get help for themselves. The nonprofit will go and apply for grants. Now they have money to have programs. But the nonprofit might not have the skillset to create those programs. So they may end up hiring someone, using the grant money to hire that person, to create the programs. You might be able to work with the people that really light you up inside that might not have been able to afford you by using this creative means.
Corporations also have educational budgets. That's another creative source that you can tap into. If you offer some type of a product or service that can benefit people that work in a corporation, you can always reach out and talk with their HR person. Maybe approach their Diversity, Equity and Inclusion Heads. Offer some type of workshop or educational series or something where the corporation pays for it.
If you have a membership model or 1:1 services you could always ask either a nonprofit or corporation, if they could sponsor spots in your program.
Someone else would pay for these people to come and be in your program. I've been in a few other programs that talk about people that have decided to use different credit cards. They can spread the fees across several credit cards in order to pay for the prices. You know, I'm never going to ask someone to do that, but I know that I have done that myself and not necessarily for educational things. I would go on vacations. Because I love to treat my family to vacations. I typically don't use credit cards. I prefer to just pay for everything in cash. I don't like to owe anything. But there have been times where I would use one credit card to pay for one piece of it and then use another credit card to pay for another one.
There's always creative financing.
I've shared with you guys before when I decided to start my business, I knew that I wouldn't get revenue right away. This is a little bit extreme. I don't necessarily recommend this to anybody. But I sold my house because I had equity. I used that equity in order to help fund my business and meet our monthly minimum math number while I was building up my business.
I also knew that my 401k plan, that I had been investing in for so many years as I worked in corporate, was also available to me for emergency withdrawal. With COVID, it opened up a whole lot of opportunities where I actually was able to get into my 401k without having a huge amount of tax penalties.
The only reason why I share this with you, is to show that there are really creative ways that people can create money to pay for what they want.
If you're offering a product and service that somebody really wants, that's going to significantly improve their life, they figure out a way to pay you. Your product/service might make other things possible for them. It may create a bigger income for themselves. They're probably going to want to figure out a way to hire you. And they'll do that through all sorts of creative means.
Don't discount them. Now, when I say discount them, I mean them as a person. Don't assume that they can't afford to come and work with you. It's quite possible that they do want to work with you and that they're willing to get creative and figure out ways to make some money.
Maybe you can get inspired by my daughter and my stepdaughter. I told you about them. I had them create their businesses this summer. They've been selling stuff at the vendor affair: Cookies, cupcakes and slime. They made money selling those things. There will always be someone out there that wants the thing that you're making.
That might not even be the final thing. Maybe as you're trying to get your business up and going, you find that you need to make some money so that you can maintain your minimum math number. That's totally normal. Everybody runs into that. At some point you might end up creating some product and service on the side that you can go and sell and make some quick money so you can get back to your regular business. Just throwing that one out there.
Okay. So price drama, you don't need to have it. It's just a bunch of optional thoughts. I have shared a whole bunch of other possible thoughts that you can think of. We've talked about crackers. We've talked about wineries. We've talked about different phases in someone's life when they're willing to get creative to pay. Because they really want your product and service.
Pick the number that works for you.
Make sure that you can at least hit your minimum math number as you're figuring out your price point and how many people you can serve.
You can get creative with your business models. You can make this work so that you can work with the people that light you up.
You also don't have to be afraid about charging a little bit more. You can help someone to feel really fancy as long as you're over-delivering on your product. Never overcharge, just bad karma there. Don't do that. Always put the other person first and then over-deliver.
All right. My friends get out there, come up with a price, do it as an experiment.
It doesn't have to be the final price.
That's going to be your final little tip as we finished up today. Experiment with your price. I mentioned Corinne Crabtree at the very beginning. When she started off, she started with a different price amount. She was at, I think, $14.99 for her membership. She experimented with different prices. She even went above what she has now and then realized that one didn't sell as well. And so she brought it back down. It's okay to experiment and see what works for you. What works for your clients?
All right, my friends, have a wonderful week. I will talk with you soon. Bye bye.
Thank you for listening to My Freedom Grove podcast. I can't wait to work with you directly. I'll help you to be your authentic self, to have amazing relationships and to live your purpose. I invite you to check out Unshakable Men and Unshakable Women. The Unshakable programs will give you all of the tools, the coaching and the community to help you rise in life, relationships, and business. To learn more, go to my freedom grove.com/workwithme. I can't wait to see you there.
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