Peaceful Profits Podcast Ep. 24 - How To Sell Without Discounting
Synopsis:
Stop training buyers to wait for sales.
In this episode, Mike Shreeve shows how to boost conversions without cutting price—by creating better deals that reduce non-monetary costs like time, effort, risk, and embarrassment. Learn practical ways to reframe value, compare against “market average,” and keep margins healthy and evergreen.
Ideal for Peaceful Profits for entrepreneurs exploring Peaceful Profits services, Peaceful Profits coaching, and Peaceful Profits marketing strategies.
Transcript:
How To Sell Without Discounting
[00:00:00] Hello my dear friends, hope you're doing well. Mike Shreeve here. Thank you so very much for taking a listen to today's episode. It's going to be a short one because it's a very simple concept. It's this idea of how to discount, or how to get the benefits of discounting without actually discounting. So we all know that our clients and customers, when we generate sales campaigns or marketing campaigns that involve a discount, we tend to see a higher volume of transactions, right?
Marketing and sales 101. Discount, get more sales. The problem is that discounting is a double edged sword. It never ends up working how we want it to work. [00:00:30] And it has a long list of negative side effects. So for example. When you discount often it trains your customers or clients to wait for the discount Which means by definition you constrict the evergreen ability of your offers or services in other words You have to use launches, whether you want to call them launches or not and call them fire sales You can call them, discount product line, whatever you want to call them You have to end up getting in the launch cycle, which it which means that You only make cash when you [00:01:00] put forth effort and put together a discount and all that kind of stuff, which is problematic if you're trying to get into Peaceful Profits.
If you're trying to get into Peaceful Profits, you have to move away from that quick, easy back pocket strategy towards evergreen. So discounting in that regard is it's basically not congruent with a move towards Peaceful Profits. The other issue that you have is that discounts eat into margins.
So yeah, you may have. A higher volume of sales, but you're going to have a much lower return [00:01:30] on investment and or margin off the sale. So we often do discounts because we need a pile of cash. What we don't always think through is for the effort that we've put forth in discounting, did we actually get a better return than just say, for example, working on improving some kind of evergreen campaign?
Does that make sense? So if you sit down, you measure your time. Did we actually make more money than if I'd spent that same time either building out, improving, etc. in Evergreen Campaign? And then of course, if you have a service where there's expenses to deliver the product that you just sold at a discount, [00:02:00] you now have eaten into those margins.
Was it actually worth running that discounted sale? Okay, now I'm not against discounts. Please understand, it is a method that works, but there are those drawbacks in that strategy. And, if you get too addicted to it, if you get too addicted to it, you'll be constantly living those side effects, if you will.
And, as a result, you won't have a peaceful business. It, having low margins and inconsistent income events is the definition of a business that will drive you crazy. Okay don't get addicted to discounting. Now, [00:02:30] that's fun to talk about on paper. But what about the reality of the market the reality of the market is that customers and clients love discounts or do they okay?
This is one of the many marketing and sales Ideas that I just I'm on a mission to destroy that this idea that clients love cheap Okay that or customers love cheap clients or customers that if we just make things cheaper Our life as a business owner will be easier if I just discount to close the sale.
That's the reason they weren't [00:03:00] buying That can be true. Sometimes I would say it's true less than 20 percent of the time What buyers love is a good deal And there is a very big difference between thinking that buyers love things that are cheap And thinking that buyers love things that are a good deal Everybody loves a good deal.
Everybody. Everybody loves a good deal. What we have to do, therefore, to get the same results as a discount based marketing campaign, [00:03:30] Where we can get a lot of sales very quickly or we can increase the conversion rates because people see it and they say hey This is it looks like a great deal is to understand how to build great deals using a method other than Price reduction is just one tool in the tool belt of creating a good deal Now today I want to give you Another tool of many there's lots of different tools and this is probably one of the easiest of the many tools for creating a good deal and it's something you can do right [00:04:00] now.
It does require that you take a look at the offer that you've created and figure out how to match the promise because what we're going to do is we are going to instead of reducing the money that they have to we are simply going to shorten the expense to them of what it is they're trying to obtain.
Okay. Let me see if I can give you another way to think about this. Everybody knows when they're about to purchase something. They're about to [00:04:30] purchase a done for you service, a done with you service, a course even. They're doing this not to be entertained, though that may be an element of it. That's not why they're justifying the purchase in their mind.
They're not doing this because they just want to listen to your voice for a bunch, they're not doing this because of etc. They are doing it because they're trying to get something out of the exchange. In their minds, they're saying, I'm going to give you this money so that I can get X. Whether they vocalize that to you or not, it depends on your sales process.
Are you asking those kinds of questions, etc. But at the end of the day, [00:05:00] when people are purchasing done with you, done for you courses, etc. They are trying to that what they're trying to do is get an outcome. They are purchasing that with money knowing that money isn't the only expense, right? So if somebody purchases a fitness program, if they're a, an average thinking adult, they know it's not just money, and all of a sudden the weight just drips off.
They know they're gonna have to do a fitness thing, and they know they're gonna have to eat a certain way, and these are all expenses in their mind. It costs them. It costs them willpower. It costs [00:05:30] them sacrifices. It costs them whatever. There's gonna be a time element in it. So what we can do to make our offer a better deal is to simply reduce the expenses associated with our offer that aren't money.
Or that isn't money. I'll give you some examples. There is the expense of time, right? That's typically an expense associated with many offers in the help industry. Example, if it normally takes six months to lose 10 pounds with the personal trainer, I can help you lose [00:06:00] 10 pounds in 90 days without one. So in that instance we have said you don't need to spend time going to the gym, going to a personal trainer, scheduling it so that your schedule matches the time of the personal trainer.
And it's not gonna take you six months. It's gonna take you 90 days. So we reduce the expense of time for that particular offer. So now that particular offer has improved in the eyes of the prospect as a deal. Now, the key here, as you see here that I've said six months to lose 10 pounds of the personal trainer, what I'm trying to do is I'm trying to [00:06:30] explain to the prospect that according to the average.
Expectation in the market, right? So if everybody thinks that it takes ten pounds, or it takes six months to lose ten pounds as a personal trainer, if we can show that's the average way of doing things, we can do things much faster or with less time involvement, then that becomes a good deal compared to what the prospect might be used to.
This is discounting. Think about what a discount is. You say, here's what the normal price is. Here's what the new price is. It's simply a comparison. [00:07:00] All discounts, and especially in the help industry, almost all price is just, it's absolutely elastic. It has no actual bearing. It's essentially value created based off of almost nothing, right?
In terms of how we justify the value and things like that. That's just the reality. The truth is, that's true of almost all products and services. Especially true in the health industry. So when we say something is 1, 000 and now it is 250, the only actual context that a prospect has is the comparison to the price it was before.
So if we are going to create a deal [00:07:30] by thinking about time, we have to think of what is the prospect used to, what do they think the, the normal average time expenditure would be, and then we can reduce that time significantly. I'll give you another example. If it normally takes five years to become profitable on a farm, I can help you break even in your first year and be profitable by your second.
So we have drastically reduced the time to outcome. Now where did I get that five years to become profitable on a farm? Just, I looked around and there's blog posts and YouTube videos and etc. And I know that because personally I, we're working [00:08:00] on building our farm and all that kind of stuff. And so I know that on average, at least from what I've learned so far, it takes about five years before you really start turning a profit on a farm.
If someone came to me and said, I can teach you how to be break even on the first year, and be profitable by the second, I would be like, oh my gosh that's a deal. Because I'm a buyer who doesn't want to take five years. I don't really have five years. I'm getting up there in age. I don't want to spend five years before my farm starts producing.
Okay. Another example, right? Because we always, these all kind of sound like your typical type of offers. Here's another example. If it normally takes you [00:08:30] 10, 000 hours to master the piano, to play any song that you want to play, I can teach you every single one of your favorite songs in just 20 hours. If you follow my, whatever, my special chord recognition system or whatever, my, my book of tabs.
Piano tabs don't even worry about learning the notes. Just do the whatever so again, this is reducing the expense of time and using what the market Typically believes is the time expenditure as the starting point and then discount against that Let me give you another one. What about an expense of effort?
Okay, this is one of [00:09:00] my favorite marketing This is one of my favorite Sort of pitches if you will or big ideas that's currently running around the marketplace Lots of people are doing it as typically happens one person puts it up first and then everybody copies them But it is I'll hire and train your sales team from scratch for you I'll hire and train your sales team from scratch for you.
This is a complete discount in effort Okay, so when we think about hiring training and making sure that our sales [00:09:30] team is performing We think of what a huge time investment. Yes, but also a huge effort investment. Oh my gosh I'm gonna have to put out a job description and i'm gonna have to and I don't even know what I should be looking for and is it and then i'm gonna do the interviews then i'm gonna have to then i'm gonna Have to then i'm gonna have to So if we can reduce the expense of effort that seems like a really good deal compared to what we are expecting we will have to go through to get that same result.
Now, I want to point this one out in particular [00:10:00] because Nearly every single one of these that I've seen and there's a couple now out there that are exactly this exact promise What you have to be careful of is you as the provider of this service or whatever So as you're saying I'm gonna give you a discount by reducing effort or reducing time.
You have to be smart about your solution, right? It would be easy for you to make this kind of promise and then go do something. That's not It's completely over leveraged. So you're working way harder than you need to be. Most of these guys, and they're all guys so far that I've seen [00:10:30] they are playing two angles.
They'll have that offer running to business owners and they'll have another offer running to people who want to become salespeople. They're both group coaching programs. They take the people who They put them through their little six week, eight week, whatever course that teaches them how to be good salespeople.
And the promise they make is, if you pass our class, we'll connect you with your first client. Again, it's all leveraged, it's all basically dipping from both sides and it's, that's how they're able to make those promises without over leveraging themselves. So again, it's easy to make [00:11:00] promises, but you have to be careful about your own fulfillment.
How are you going to do it without completely, running yourself into the ground? And then these these handful of companies that I've seen making the same promise have got that sorted out, it seems. Okay, next is expense of risk, right? Expensive time, expensive effort, right? These are pretty straightforward.
Expensive risk, I'll get you 20 new leads or you don't pay. The, you don't pay, that's a very common one. We can dissect the history of that. Alex Becker had the, this will This will reduce your cost by what 25 percent or you don't pay now everybody's doing that or you don't pay right [00:11:30] again You got to be careful about the promises make sure you can actually fulfill but that's a an expense of risk.
Okay. This is a deal This is a discount compared to everybody else because everybody else is gonna charge you whether they get you the leads or not We'll get you the leads or you don't pay. Okay, so these are obvious, right? You could play with this. I like to do a sit down and think about, what are the expenses that my prospect is thinking about when they're about to purchase from me.
Okay, so you can think about that. What you then have to do, however, what you then have to do, however, is think about the non obvious expenses. Okay. Cause today's [00:12:00] world is quite competitive. Like I said, lots of people are using the, or you don't pay. Lots of people are literally running the same. I'll hire and train your sales team from scratch offer, right?
So there's just a lot of people doing a lot of the same things and that happens. That's just the nature of the game. What you can do to make your discount seem unique is to think of the unobvious expenses that people associate with the outcome that you're trying to deliver. I'll give you one example here.
And this is one that is more relevant to. Almost all offers [00:12:30] and I think most people first think about but what about the expense of embarrassment, right? There are some outcomes that people haven't pursued yet because they're just embarrassed to pursue it. I'll give you an example What if you were an expert?
In helping people save their marriage without having to go see a therapist There's a lot of people who want to fix their marriage, but culturally were raised to believe that therapy was for [00:13:00] weak losers, et cetera. And so they're looking for a way to not be embarrassed while also saving their marriage.
You come along and you say, look, you don't have to tell, get the whole family involved and they find out you're doing therapy and you're going to be embarrassed and all that kind of good stuff. We have a very private. not very secure, no one has to know, it's just you and your, spouse or whatever and the way that we do it is, et cetera, et cetera, and we're reducing what as an expense of embarrassment.[00:13:30]
Another example might be, let me actually turn this one around. Let's say for example, and I see this commonly with offers like eating disorders, overcoming addictions such as gambling, overcoming addictions or issues like pornography, that sometimes those offer creators aren't thinking about the expense of embarrassment when they create their offer.
And that could be why people aren't closing. I'll give you an example. Let's say that. You are somebody who helps men overcome pornography use. Okay. If [00:14:00] men haven't overcome it or gotten help because of embarrassment because of the expense of embarrassment Do you think it's a good idea to use your public group?
As a tool for selling your offer The answer is probably not that might actually be the thing that turns people off so again When it comes down to the specifics of what to do about your offer You have to think that through get help get coaching whatever to think that through but it's the idea is The way you can discount without having to actually use price as the tool you use to discount to make your offer [00:14:30] seem like a good deal.
You just have to sit and think, what are the expenses that my prospect is anticipating? There's the obvious ones, and then there's the non obvious ones. could be the expense of embarrassment. Maybe they are anticipating the expense of having to break off relationships. Say, for example maybe you help people who are very codependent, and you help them to be free.
One of the things that they are anticipating while they're about to You know think about purchasing your thing is what about all these relationships, [00:15:00] right? Because maybe they're thinking you know Maybe it's average in that market to think in black and white either you are codependent or you don't have any relationships Right, and so one of the ways you can make your offer seem like a really good deal is to say look we get it You know, we're not here to try and make it so you don't have any friends.
You can keep your friends, you can keep your family relationships. We're just going to teach you how to be independent within those relationships. So what did we just do? They were anticipating this big expense, this big emotional, I'm going to have to cut ties, and I'm going to be by myself. And we just said no, we can [00:15:30] still get you the outcome you want.
And you don't have to spend that emotional energy or go through that experience, right? Another unobvious one might be the expense of doing things in public. You may call it embarrassment that probably would fall in the same thing, but maybe for you specifically, how to use social media without ever having to show your face.
There just are some people who don't want to be in public. There are some people who want the benefits of what social media could give or whatever, but they just don't feel comfortable putting pictures of themselves. Maybe because they have a job, maybe because it's just whatever. So if you can [00:16:00] reduce that expense.
Anyways, I could go on and on. You can spend hours thinking through this. I recommend that if you. have enjoyed discounting in the past and you're trying to figure out better ways of discounting that you start by simply looking at non monetary expenses that your prospects show up with or assuming they're going to have to spend and seeing if you can reduce that.
In any way now this may require some adjustments to your offer and that's important and that's really to be honest It's the secret to the whole thing Your marketing is only as good as [00:16:30] the offer allows it to be you can't lie You have to say this is what my offer is. This is what we do So if you want to improve your marketing you improve what the offer delivers That's really the key the secret especially today with so many Promises being made by the same people and they're the same promises over and over again But if you can do that, you should start to experience the benefit of discount, which is that discounts are good deals, and that means that you can continue to sell your offer in an evergreen fashion, so you don't have to do launch cycles, your margins [00:17:00] will stay the same, you don't have to reduce the price, you can have a good deal without reducing the price.
And then that should allow you to also continue to build a strong relationship with your customers, strong relationships with with your buyers as well so that you're making sure that you're attracting the right people, right? We want to make sure that We are attracting people who want the desire, who have the cash, who are serious about it, but who are looking for a good deal in some way.
Okay, so that's it, my friends. Really nice and short and sweet today. If you would like some help in coming up with these kinds of strategies [00:17:30] for your offer, if you'd like to learn more about what the other many different ways are to creating a good, strong, solid offer, that's exactly what we do here at Peaceful Profits.
Among other things, we help people to create evergreen offers with really strong margins that allow them to Continuously sell without having to get into the hectic nature of launches without having to cut into their margins without having to deal with Discount buyers and all that leads to just better results for the people who buy right?
It's very difficult for us to deliver our best when we're struggling to [00:18:00] keep the business afloat We want to have offers that financially support us in order to do that. We need to have strong Well thought through plans and strategies to give everybody what they want A good deal for the client and space for you to serve that client.
Okay, my dear friends, that's it. Again, if you want help with this kind of stuff, peacefulprofits.com/call. Let's chat, let's see how we can help you. We've got all sorts of different options done for you, done with you, do it yourself. Hope you have a wonderful day and we'll see you in the next one.