Discounting, and Why You Will Always Lose the Race to the Bottom
When it comes to discounts, there is a difference between what people say they want, and what they actually want.
Discounting is fickle, and almost always a bad idea unless you’re the Zohan of course.
Competing on price forces you to race to the bottom and when that happens, you will lose. Discounts are bad for a few reasons:
- Lack of Confidence. Moo-chacho’s that don’t believe in themselves offer discounts. When somebody discount’s their services, it tells a prospective buyer that you’re begging for business. Nobody wants to train with an empty trainer. Create the illusion of confidence even if you don’t have it, and always appear to be in-demand.
- Bad Precedent. Once you discount, people expect it to come again. You have lost the ability to sell at the price you’re worth.
- Competition Based off of Price. Sell on trust. On value. And on reputation. Not price. Leading with a discount as a way to attract a lead immediately opens a conversation about price, disallowing you to showcase value appropriately.
- You Make Less Money. Wealthy online trainers know how much their time is worth and refuse to work for anything less because that’s how they become overworked, underpaid fitness slaves just like in many big box gyms.
There’s a Better Way Than Discounting to Make a Client Buy Now
It’s called scarcity.
What you’re after is a reason for somebody to purchase now. A reason to get the people thinking, but not yet taking action, to throw money at you.
Scarcity done right can improve the perception of confidence, make it seem like you’re in-demand, and allow you to sell at higher prices, not lower.
There are 3 basic types of scarcity. I’ll list them in order of most powerful to least powerful.
1. Closing. You can’t have it unless you buy before a certain date.
2. Bonus disappearing. You won’t get the bonus unless you buy before a certain date.
3. Price increase. Price will be more after a certain date so buy before.
You can mix and match these.
A Case Study of Scarcity in Action — The Online Trainer Academy
The Online Trainer Academy is open twice a year for enrollment. Closing it for 6–8 months at a time allows my team to take care of existing students, take in feedback, and improve the course. It also simplifies my life. Knowing that there is a time to sell and a time to foster relationships with potential students, ensure their successes, add value, and craft content is helpful.
From a marketing perspective, it also allows me to create an element of excitement and scarcity around the enrollment time. November 2, 2017 is when I open doors to the next cohort of students. Anybody following me here or the 22,567+ in the Facebook group (Online Trainers Unite) have known this for 6 months.
Additionally, this time around will have an added bit of scarcity around enrollment because it is the last time that the price is going to be what it is.
*(All major questions answered including investment cost here: http://onlinetraineracademy.theptdc.com/right-for-me).
After our November release the price is going to increase $500. So if a person doesn’t enroll in our November period not only will they have to wait another 6 months, but they’ll also have to pay $500 more. Still a great investment, but why pay more if you don’t have to? That’s how scarcity elements can be mix and matched.
As a side note: If you are going to increase price you need a reason. In this case, I’ve hired two independent contractors (A PhD in distance course learning design and the distance learning expert for Yale University) to consult and help improve the learning experience. That, and the steps are being taken to get the certification accredited.
Don’t discount, it’s a race to the bottom. Instead, add elements of scarcity and win the race to the top by creating your own category of one AND giving your potential client a reason to buy now, instead of waiting later in the hopes that you’re going to discount again.
-Jon ‘The Wealthy Online Trainer Maker’ Goodman
P.S. Save $200 and get on the waiting list for the Online Trainer Academy at www.onlinetrainer.com/academy. There’s no commitment to invest by putting yourself on the list, only a commitment to learn more about the program and a chance to reserve your spot before the public (and we will sell out).