The Hidden Psychology Behind "What Do You Charge?" with David Abbott - 334

0:00Hello, you're listening to and watching Sarah Archer, an episode three hundred and thirty four of the speaking club podcast And I'd like to open this show with a quote from the wonderful speaker and sales guru Zieg Ziegler People don't buy for logical reasons. They buy for emotional reasons I started this podcast for two reasons because I want to help people recognize the power of stories and humor and speaking And because I believe it's your message that counts, not the number of uns and ours you use There are some organisations that want to create robot speakers They want you to sacrifice your personality in order to speak perfectly I want to let you know that you can be yourself and a sensational speaker So, if you want to be a speaker that connects and engages authentically through stories A speaker that gives value as well as a great performance, then welcome home If you've ever found yourself lowering your speaking fee or hesitating when someone asks you

1:05What do you charge? Or wondering whether you're actually charging what you're worth Then this episode is going to be a doozy for you Because pricing isn't just about numbers It's about confidence, positioning And also how clearly you can articulate the value that you bring And my guest today, David Abbott, is someone who spent years helping businesses and speakers get this right He's a pricing expert, he is a professional speaker And he's the creator of the brilliantly named platypus pricing process Which we will definitely be getting into And in this conversation we are going to be exploring why most pricing problems are actually communication problems The psychology behind what people are really buying And how speakers can stop undercharging without feeling like they're pushing or overpricing themselves

2:09So, if you want to be better at charging what you're worth and getting paid for the value that you create You'll want to listen to this one Without further ado, let's dive in Welcome to the speaking club, David Abbott Thanks for your advice, lovely to be with you and how are everybody out there? It's great to have you on the show I was fortunate enough to see you in action live just a week ago So, I already know the answers to some of the questions that I'm going to ask you But I'm excited for the audience to get those golden nuggets that I got last week So, let's get cracking First question I wanted to ask you, David, is how did you shift from being an engineer to becoming a pricing specialist?

3:10It must have been a long journey, doesn't it? There's a bit of a gap in between the two I really enjoyed being an engineer It's great, if you're interested in that kind of thing, I was in the electronics design engineer It's like being a crossword enthusiast and you paid to do crosswords all day, it's fab But there are a couple of things, as I progress through my career, there are a couple of issues One is, it's fantastic being an engineer, managing engineers is a pain in the backside But the other thing is, I've received a specification, something that somebody wanted In the days when I was designing integrated circuits, you had to be a specter in the integrated circuit So I go away, I design the thing, get it manufactured At the end of it, you've got this black thing with legs on it And that goes into a product and it goes out into the marketplace So the somebody out there figuring out what the trends in the marketplace are, what customers really need

4:10What problems could be solved and come up with ideas And then from that, we're approaching me with that spec, I do my bit in the middle Then they go off and they learn shit and they promote it and they decide on the price for it They do, all the rest of it, there's a whole great big commercial process And I'm responsible for one little slice in the middle And I was just interested in the broader picture So I made a move from product design into product marketing Which is very much around the trend forecasting and what are the appropriate technologies to use And then from that into marketing communications, then does a marketing qualification Then senior roles in marketing and pricing is one of the elements of marketing People used to talk about the four P's of marketing, it's seven these days And the four P's, the classical ones were product price, place and promotion And you can find books galore on product, place and promotion

5:10Not many on price, so it seemed like there was a bit of a gap and here I am You filled that gap Now you've developed what you call the platypus pricing process Yes How did that quirky name come about? And what's the big idea behind it? I would love to say with it stands for something P's for profit and L's for, I don't know, whatever Nothing like as clever as that When I first developed the content and started speaking about it It was just called the psychology of pricing And there's a huge amount of detail that goes into a pricing process There's all sorts of different stages Warm bit of it is, how do we communicate a price effectively? And that's the psychology bit That's the interesting bit that audiences like to listen to

6:10Because we're all very quirky and it's a lot of fun Finding out just how weird we are But the psychology of pricing is a little bit boring And when I first joined the PSA We had a number of conversations around this But with people within the region that I was part of And the mastermind group that I went along to And I remember people talking about it at other speakers There's some people written the book Why nobody ever washes a rental car And I've never read the book But I may have got a word or two wrong in the title But it's going to be close, it's memorable And it kind of sells something as well You can see why nobody washes a rental car They don't own it, you know You can kind of guess what the message might be behind it And I was just trying to find something that had that kind of Sticky, memorable kind of name And it was literally in the meeting I was just talking about things And the bit of illiteration just suddenly came out of nowhere

7:10How to price your, we were talking about the whole bunch of things And the platypus was just suddenly there So there's no much silence behind it There's no clever acronym or anything like that Since then, so what was that? I don't 2012, something like that Since then, I've had occasionally a little bit of pushback From an audience where they'll say, you know, great topic And all the rest of it But you know, it's a serious subject is pricing And the platypus is a little bit white-hearted You know, you could drop that No possible way Because the number of people that have got in touch with me And said, I heard you five years ago They couldn't remember your name But on Google Platypus and pricing, and there you were You know, the beauty of something like that is It is sticky, it's memorable I mean, become known as the platypus pricing guy or whatever But it's a fantastic handle So it's staying Yeah, no, it's brilliant And I think having seen it in action The concept of a platypus, you know, the awkwardness of this

8:15The sort of one-offness of it It really works well with the theme of your talk And your sort of idea behind everything One thing that I just wanted to just go back on In terms of your engineering background You know, and there's a process Some of that, do you find that having had that background It means that you're approaching this subject From a slightly different angle Or have you sort of really discarded that engineering stuff? Well, it's a fundamental part of me And you gather in Tangle Cause and Effect, you know I don't think it's an engineering It's something that made me what I The kind of person I am that's highly driven by data And you know, in the colour profiles I'm a very high blue The reason I went into engineering in the first place Will it be because of your huge affinity for numbers signs Three maths A levels, you know

9:16That's the kind of person that I am So I like data, I like research When I am presenting, you saw this on the slides If there's some academic research The Baxter, the particular concept that I'm talking about So I'll quote the research You know, if you're supposed to go and read it Dolly Boots, you know Cause I find all of this incredibly interesting So it's just We'll have fundamental characteristics don't we And that's just part of me I like numbers data and evidence Excellent, and I mean the interesting thing though You know, you've got that affinity for numbers Most people will think that pricing is all about numbers and data But actually, it's the antithesis of that It's more about psychology So why do you think it is that emotion is more powerful than logic

10:16When it comes to price and buying decisions Emotions more powerful than logic in almost every single thing that we do You hear people I'm going to butcher the saying But there's something along the lines of You can't argue somebody into a position using logic Whatever their current position is They didn't arrive at using logic Almost nobody arrives at their existing positions About the world or the positions about You know, a particular thing that's in the media or whatever Because of logic You know, they arrive at them because of a whole bunch of things It's all of your experiences up until that point All of the stories that you've told yourself in experience All of the stories around The particular thing that you're listening to right now How those stories are delivered We're storytelling animals

11:17And it's stories that communicate points So when I do talk about the platypus Although I'm a numbers guy and I do like the research As you saw I don't say right Here is this paper If you look at chart number four I'll take Look at the data trends There's none of that We tell some stories around pricing I'll tell some stories about organizations I've worked with Or things that I've seen out in the marketplace Whatever they are They bring the thing to life And that's how we connect with each other It's through those stories, isn't it? So it's the only way You know, professional speakers tend to be professional storytellers And that's something that you know something about as well I mean, if we ever doubted The fact that we're driven more by emotion than logic We only need to see what's happening in the wider world To see that played out

12:18Unfortunately But anyway, we're leaving that aside But to do that, there's definitely something on display right now One of the things that you've said And it came across in your talk Is that most pricing problems Are really value communication problems I wonder if you could elaborate on that What you mean by it And also how people can start fixing that Over the past four, there are 10-12 years I've been speaking to a lot of CEO groups And if people are familiar with what a CEO group is The biggest in the UK is something called Vistage And a CEO group, there's a 12 to 14, 16 Founders, MD, CEOs of an organisation They meet once a month, business speaker in the morning And in the afternoon, if there's an issue at work, they bring it to the table And they get the help over the else We're not talking to a CEO group I have a look at all of the websites for all of the members there

13:20Because I create bespoke examples of the content that I'm going to deliver To bring it to life And I've spoken to around about, well, typically about 20 years So if you do 12 years, time of 20, a year, time of 15 in a group I'm not going to try and do that now Because he's in the thousands, that's how many websites I've looked at To create those bespoke examples And I would say that 95% of those websites talk about How long we've been in business when we were founded The awards that we've won, the things that we do, the incredible machinery that we've got We've got five access, something or others that allows you to do this, that's all the other Very few websites talk about the outcome that you're going to get when you work with us A value that we are going to deliver And that's the key thing that every single customer, clients, whatever you're to call them, is looking for

14:22They don't really care about how you're going to do something They care about the difference it's going to make to them And most organizations could do a better job of defending the price that they go to market with Or actually increasing their price if they clearly communicate the value Remember things that I say every single time to every single audience says It's not the customer job to work out for themselves What value they're going to get from you It's your job to clearly communicate that value And given that the vast majority of websites that I look at don't do a good job of doing that If you do a good job, you will stand out And I know I'm talking about websites and focusing on that because that's the public facing Bit of the organization that I can actually look at But at any time I've worked with the client, the rest of their marketing materials Tends to be very similar, you know, their pitch decks, their brochures, whatever it is that they send out Even I did some work with a distributor

15:22I'm not going to say what the product was because they're the largest in their field And if I'd named the product it would be instantly obvious who it was But I spoke to the senior sales team before I actually did the same session that you've seen The platypus pricing And I asked them, why did people buy from you when they said, well, you know, we've got the biggest range in the marketplace We carry all this to everything next stock We've got fantastic processes so we can deliver it the next day It's really high quality stuff, we back it up with fantastic technical support, we do this You know, we've got a big list, they didn't mention price And then I got hold of their marketing materials And every single thing was lowest price, sale, from You know, all of the marketing materials was about, we're cheaper than somebody else And none of the communication was about, this is just how good we are to justify the price that we want to charge in the marketplace And that's not an uncommon gap

16:24So, you know, I really do focus on value, it's simply because in my experience, 70 companies are really, really poor And understanding what value means for the customer and then communicating the way in which they're going to deliver that value That's really interesting, I think what's coming to my mind is that It feels now in the current sort of economic business climate With all the uncertainty that people are facing in all different aspects of, you know, life at the moment That there is a hesitancy in making some decision, some buying decisions And that can result in the temptation to look at making things cheaper, more affordable So that it becomes easier, cycle even think that it will be easier for people to make a decision

17:30If the price is cheaper, given everything that's going on at the moment How would you say that's true or would you argue against that and focus back on value? There are elements of truth in it, obviously And in some particular markets, it's more true than others So for example, in every corporate role that I've ever been in If there's ever a downturn in the market and the company feels it needs to tighten its belt All training courses stop And the marketing budget suddenly gets smaller Because they feel like their discretionary spends, you know, within an organisation So it is the case that industries face tough times Depending on what's going on in the world and what's happening in your marketplace And what the competition is doing and a whole bunch of different factors

18:32The issue that I have is that for most organisations, the one tool that they think they've got in their toolbox is price So if things ever start to get a little bit difficult, right? Well, we need to start dropping our prices, you know, undercut everybody else We'll protect our market share or we'll protect our revenue while the market is actually declining or whatever it might be But they're ignoring that everybody else in the marketplace is looking at them and thinking along the same lines And you're rapidly getting into that race to the bottom And I would rather try and find ways to focus on the brand and the brand what the brand means for the customers So I'll come back to the brand just in a moment Now this is more of a marketing issue But really focus on communicating the value If you can justify the price that you want to charge, then let everybody else go down

19:32It's not true there, so all customers always go for the cheapest price in the marketplace You only have to think of our own buying habits How many people own an Apple iPhone? There are cheaper phones in the market that do everything that an iPhone does Even if you're bought into the whole Apple ecosystem and they all talk to each other I had an iPhone for many years while I was still on Windows PCs and didn't have an iPad And it was the only Apple product I had, I still had an iPhone There were lots of people like that But there's something about the value, the ease of use, the box it came in You think, if you've got an iPhone, I remember there was a thrall down my spine When I got the phone home and I picked up the lid of the box, the whole box came with me And then the bottom, slow, I think I did the box three or four times before I took the phone out You know, the much more complicated we think that every customer out there is a really simple decision-maker machine

20:40If you meet the spec then whatever the lowest price is, that's always going to get the business And then we personally, we make much more complicated and sophisticated decisions The thing about brand was, join COVID A lot of companies stopped spending money in response marketing Where paper clicked, that kind of stuff For whatever, perhaps, if you're selling online, that's fine You can still go through the year, the post But if you're trying to drive for people to a physical location and they're not allowed in the shop anymore Then you can save all of that money or you can spend some of your marketing money on other things There are quite a few analyses after COVID, you're to after COVID, to look at Or that happened during those years And it looked like those companies who invested in their brand So in building the brand perception, the understanding of the brand, the value of the brand in the marketplace

21:40That not only drove sales during the period in around about the same levels as the response marketing used to do But it actually built market share coming out of COVID And it's just illustrating that we want the comfort There are a lot of psychological things going on So if you buy something with a brand on it that you know and trust There's an element of less risk or an element of self-esteem Or from a person's perspective, nobody ever got fired for buying IBM There's an element of things that's tough I could save a little bit of money And if the production line stops because of my decision I'll lose a bucket load of money trying to get the damn thing going again My job's on the line Or I could go back to the premium supply that I've used all of these years And know for absolute certainty that that line is not going to break down And everything's going to be absolutely fine

22:41And a price actually communicates something about what to expect So if you do have a quality product and you push the price down You're actually communicating that maybe it's not such a good quality after all Interesting Actually, me just reminding me There's a client that I did some work with This is an electrical wholesaler And they had grown from £10 million turnover Making £1 million profit to £20 million turnover Making £200,000 profit So they've gone from 10% operating profit to 1% operating profit And it was because they got discount happy They were chasing growth And the only tool that they had in the toolbox was Will drop our price If we've got the lowest price, we'll get the sales Well, they've got the sales But it has a vastly reduced profit So they've put people making a movement pounds

23:44And now they're making £200,000 In what way is that success? Yeah And they're probably having to work harder to get more sales The price is hard They've gone from £10 million to £20 million The record price is hard for less money In what universe does that make any sense? No, that's really interesting And I think that whole... I mean, we're back to the psychology again Like status drives so many buying decisions In a resource of different ways And whether you're trying to protect your status Or flaunt your status or whatever it is You're absolutely right, that's so interesting Okay, so four-setting prices then You know, you talk about the platypus In terms of setting prices, most businesses Still priced based on cost or competitor benchmarking And you're talking about value You know, what is the smarter way for them to approach pricing?

24:48There are... We're getting into the technical side of pricing now And quite away from the psychology behind this But there are a number of tools that you can use In certain circumstances It's possible to figure out what value you are delivering And then there's also sort of research That suggests that people are In general prepared to pay somewhere between 5% to 20% Of the value that they receive So if you're doing something It's going to create 100,000 pounds worth of value for somebody Then a fear between 5% to 20% Somewhere in that range That's quite a big range, but I'll come back to some of the tools But there's a... In theory, if you're going to generate 100,000 pounds for them And if you charge 90,000 pounds They're still getting 10,000 pounds extra in theory If they're purely logical, they'd still be happy with that In reality, where they think that you're taking the Mickey end And they draw that they rather not do it at all

25:51They give you 90,000 pounds and they only get... You know, all sorts of human factors are coming to play But so between 5% to 20% feels further people So that's one aspect, you know, trying to understand From a monetary point of view And money isn't the only way that we compute value Value mean many things to us, but money is just one of them Do is, there are a whole bunch of tools that you can use Things like Gabor Granger or Becket de Groot, Mars Shackle There are tools that you can use to establish people's willingness to pay And I'm not going to go into the detail of them There are Wikipedia pages and all of them There are willingness to pay tools in the marketplace that you could employ And that then involves a little bit of research And just asking people what there would be prepared to pay in certain circumstances And then thirdly, there is a tool that I use with pretty well every single client Which is a comparative value tool So this tries to figure out how do people perceive your value versus your competition's value

26:55And then you can plot that on a horizontal axis Where you've got 100% is you can do everything that particular customer client can possibly imagine perfectly So there are tools that allow you to compute the value So you work out as a percentage of that The maximum possible value that you can deliver Where might you be and where might the competition be And then if you've got some idea of the fee you charge versus the fee that they charge Then you can do a scatter plot You can see and you can see what we use, sit relative to everybody else Not just in terms of there's a range of prices out in the marketplace Which is what you said You can see right, most organizations is either cost plus Add all of our cost together stick and margin on Or we'll just have a look and see what are the prices in the marketplace And it feels like we're at the premium end so we'll price towards the top Or it feels like we've got some cost efficiency so we'll price towards the bottom By doing the scatter chart you can see exactly where you've fit compared to over the else

27:59And then you can make a specific decision as well I'm actually delivering quite a lot of value I'm going to deliberately price up here And it might be higher than anybody else's price in the marketplace But I think I'm delivering more value than anybody else in the market So you get that picture and it's a better way of making a pricing decision Than just either finger in the air Or let's just copy whatever they're also doing Simply somewhere in the midst of time work this out perfectly And since then we've all been copying each other So somebody wants upon the time they got it right No, they didn't 30 years ago and somebody invented this process What I've really did We're all full of somebody did that And since then everybody's just been copying this It's really interesting The next thing that I want to get on to is some of maybe the strategic things Like talk about making prices stick here Can you say what you mean by that

29:00And how you can increase the chances of people saying this without discounting And thus very much comes into the psychology behind How we make a pricing decision And by that I mean the client How does the client decide? Yeah, that's a fair price to pay I'm happy to pay that price or whatever So there are a number of things that we can do One is presenting more than one price If we only present one price to somebody Then the only option that they've got is to compare that with Anything they bought in the past Or alternatives that they can buy from other people Or other things that they could spend the money on Or if you present three options Then subconsciously It feels more like they're in control They've got some choice Now they can choose between these three And they think less about The other options out there And I do not want anybody to think That's okay, that's your product And we're going to find a way to take some cost out

30:00And take some cost out We'll create three options that way It's by adding value and adding value So you've got a good Can you find a better and a best? That's one way of doing it Another way is something called a pricing anchor And the pricing anchor is just where Planting a number in somebody's head That means that any numbers after that feel more reasonable And the simplest way of doing that Is if you've got three prices Start with the highest price first And if you want to see this in action Watch the celebrity strictly Not strictly a bake off And the celebrity one It's a charity thing So it's stand up for cancer And they'll do a bake And they all walk out into the garden And they're going to break for the ads And they come back from the ads The judges are going to have a look at the bakes And something might get the handshake

31:00But immediately before the ads There's a little piece to camera Where they talk about somebody and their family And having cancer and the importance of giving And then was the donation page And the donation page reads To donate 40 pounds, 30 pounds, 20 pounds, 10 Text, 40, 30, 20, 10 And it's in that order Because when you hear 41 That becomes the reference Against which everything else then gets compared Or 40 is quite a lot Oh, 30 is not too bad Oh yeah, couple of 30 If you started 20, 30, 40 10, 20, 30, 40 Then people anchor on the 10 Oh yeah, I could afford a bit more than that I'll do 20 So the first number of the people in Canada Becomes that reference point That's internal reference Against which everything else then gets compared And a third tip would be To make your numbers slightly precise So there are a lot of people who I don't know

32:00Let's say you provide a service A law firm Let's say you're a law firm You've had a look at this Somebody wants to have a look at their Their terms of conditions Yeah, they're getting into a new lease for something And you're going to go through all of this And you know how long it's going to take roughly Because you've done it many times before So what your hourly rate is And the lower hourly rates 10 to be 454, 75, 500 Yeah, they tend to go in 25 pound multiples So you think, well, I charge 500 pounds there And now I think this is about 10 hours worth of work Okay, there's 5,000 pounds But 5,000 pounds That really does sound like You've just done the finger in the ear thing It sounds You're inviting people To get into a negotiation with you If instead your hourly rate was 513 And it wasn't 10 hours You actually look at it well It's going to be close to 10, but I actually I think it's going to be more like 10 and a half Or 11 or whatever

33:00You multiply more precise numbers together And you quote the precise number Then it feels like there's some signs behind it And in the example I've just quoted The genuine lease a bit more signs behind it But it feels like there's more signs behind it And the customer is less likely to negotiate Yeah That's one aspect where there's a negotiation element But even when it's just a price on a page And you either pay it or you don't There are a few psychological things going on there The 99 Pents thing That's called Charm Pricing So if you knock a penny off And it changes the first digit So you go 10 pounds, you knock a penny off And it becomes 9.99 Or better still 20 pounds, you knock a penny off And it becomes 99 The first digit you change it from a 2 to a 1 It feels like it's less expensive Because mentally we put it in the 20's book It's on the 10's book There's only a penny difference But it feels like there's a bigger difference That's one factor But the whole precision thing If it's not 20 pounds, if it's 21 pounds 32

34:04Again, it feels like there's a reason But be Again, there's a chunk of psychological research around this Precise numbers just feels smaller to our brains than round numbers do So it's entirely possible that if you did exercise It would different people to try and get them to estimate Or describe the size of 21 pound 32 Versus other people describing the size of 20 It's highly likely that the people describing the 21 pound 32 Will describe it as a smaller number than the 20 Because to our brains precise numbers just feel smaller And there's three tips there that should be able to help anybody with their pricing Through options start with the highest price first And try and make your prices precise Really simple stuff Yeah, excellent That's brilliant Thank you for sharing those Those are really, really cool Now, I wanted to turn to speaking edit more now

35:04Now you are a speaker And I wondered in your own speaking journey How did you decide on your fee And what was the biggest mistake that you made early on? One thing I'm not Is I'm not a walking encyclopedia of prices The number of people that come up to me is like I've got this problem I'm launching this new service What price are the charger? I have the clout I've got a whole lot of ways in which we can figure out whether I price should be But I'm not walking around with every possible price in the universe stuck in my head As a consequence, the same challenges that other people have when I first started Plus when you're yet to be well established When you don't have the testimonials, you don't have a speaker show where the people can look at It's evident that you don't have the same pedigree that other people might have

36:04It's difficult to charge quite as much You can't just decide right I'm going to be a professional speaker And then tomorrow I'm charging £10,000 for a keynote It doesn't work like that So I did some work I tried to find out what was going on in the marketplace I looked at the value that I was delivering And based on that came up with some early prices Which I backed off a little bit on because of confidence Humans as anybody else And because I was yet to be established But what I've been doing consistently is Testing higher prices, pushing higher prices, trying different things And the fees that I'm charging now are very, very different to where I started So my advice would be to anybody setting out as a speaker Or anybody in the similar circumstances where you're providing a service of some kind OK, be tentative at the beginning

37:04Unless, unless you are signing up people for life Because you won't even agree the price is very hard to come back and change it But assuming that it's per gig old, per activity, whatever it is You might start off a little bit tentative, but keep testing Do not stop testing higher prices, keep trying a higher price all the time And eventually you should reach a point where you are losing opportunities And it's clear that you are losing them because of price There was a client that was in one of my audiences This is one of the CEO groups And the chair just asked a whole question He asked everybody, when was the last time you increased your prices and how much buy And there are a couple of people that did this every year in the followed inflation There were a couple of people handed in for three or four years They looked a little bit sheepish about it They got to one person, they were a firm of architects And the guy said, well, I think it on average is probably about every nine months

38:09And what do you mean, roughly on average, in why nine months? So we measure our win loss ratio And if we start to win to more opportunities, then the limit that we've set our prices go up So we aim to lose a third of the opportunities that come in to the business Now, the 70% that we win, that keeps it completely busy And if we start, if it starts to go too much, if the work is coming in Now, what we don't want to do is go and recruit another person and then recruit another person And suddenly there's a downturn and then what we do is we just put our prices up And bring the demand back down to an acceptable level That's brilliant, absolutely fantastic So they're monitoring that key metric and continuously pushing their prices

39:10God, that's really interesting That's really clever actually, it's good And I think that's probably people don't pay enough attention to those numbers to be able to do that I just, quick anecdote, I know there was some of the, suddenly she's not with us now But the Sunday in the speaking industry, this is 10 years ago, I think To tell me, the cheid tripled her prices over nice The number of inquiries didn't go down but they didn't go down to a third Or the number of actual engagements They didn't go down to a third of what they previously been So she ended up working less hard and at the same time making more money But what most organise, if you go back to what we're saying earlier about discounting in order to win value Do you really want to work harder to make less or less? Who would do less work and make more? I think it's a pretty easy decision Yeah, absolutely, absolutely

40:10Now I'm going to put you on the spot here Okay And it'd be interesting to get your take on it Now you and I were in the same meeting last week When this came up, where a speaker had been booked by a company And the company told her that she was half the price Then all of the other speakers who had been put forward for the gig And all of the other speakers were men And so she fed this and they said we wanted to book you not because of your price But because of the value that you are going to deliver to our audience And we wanted to let you know So she fed that back to the booker, the agency booker who was also a woman And the agency booker said to her I can't increase your prices in parity because it will price you out of the market Have you got any tips or a view on that?

41:13It's really, I know it's a thorny question But I just wanted to get your take on that There were a few things there that I'd like to know a little bit more So what was the Bureau saying? I can't increase your price as a female speaker Compared to the male speakers Because if that was the message and that wasn't said on the day It wasn't That was the message This close to international woman's day as well I would have a really big issue with that Because it shouldn't matter, it shouldn't matter anything about who or whatever It's the value that you're delivering to the audience That's what we should be paid for Now it's a simple as theirs I would end up shopping around for a different Bureau I think to work with Certainly I'd go back to the company And try and find a bit more information on the other people who had quoted

42:17And what else they've been quoted in the past Because it would be this in the first time they've held a conference or whatever it was Because it may be that the speaker Bureau's perception of what the market price was is incorrect Or it might even be that this particular company, they're in a specific market sector Where they do expect to pay more And the speaker Bureau person, they're right about the market in general But they're wrong about this particular industry And she needs to update her data for the future So there's no single answer There's no light to understand more before I would certainly, I would be tempted to go back to that the speaker booker and say I understand, okay, you don't want to double more prices But let's pick another thousand on right now Let's see how that goes Exactly, I did, as I said, I put you on the spot

43:18But I think there's some really interesting questions that you've raised in terms of context around this But yes, good, okay Another speaking question, one that's come up with my clients And I have a view on this, but I wanted to check in with you as you are the expert In terms of online versus in-person gigs There has been a tendency for speakers to discount online gigs versus in-person Have you got a view on whether that is right or wrong? I don't think there's an absolute answer to that or right or wrong I know what I think about it, which is You're paying me for the value that's going to be delivered So if I'm running a session If I'm running a keynote and I'm delivering it 45 minutes online versus 45 minutes on the stage I'm going to charge the same because you get in the same value either way

44:19If it's in-person, I'm foregoing some of my time Because there's travel time involved But you're going to pay me for the travel in the hotel So in-person actually costs me more to deliver I ought to be charging more and I guess that's the control or for virtual you charge less Because you don't have that travel time you can fit more in But that's starting to say that what we're really charging for is our time One of the things that I point out is there are three fundamental things that we tend to sell One is our inputs So if lawyers are charged, you know, if you're 200 pounds an hour and something's two hours, then it's 400 quid If it's three hours, it's 600 quid You know, all you're charging for is your time

45:19And in a way, by saying that it will be less for virtual because it doesn't have all the travelling And that kind of stuff We're basically saying it's not the value that we're going to deliver, it's the time involved So companies, they are the charge for their inputs, which is typically time Or it's their materials, cost plus charge, pricing is just charging for inputs Or you charge for your outputs And basically say that what I deliver is the same as anybody else It's almost fungible, there's a market price And it doesn't matter who you go to within the market, market price You're going to get the same value you pay the same price I'm much more focused on the whole value conversation that we've already had What are the outcomes that you're going to get? How are things going to be different and better for you as a consequence of the work that we do together Generally, what value am I going to deliver? And that's what I think we should be paid for

46:20And if I'm being paid for the value, then I don't care whether it's online, via say-ons However, we could do it using a Ouija board, I don't care It's the same price If you could do that, are you being in a fortune? Excellent, thanks David I'm going to be the first speaker who comes back from the dead And they're free, it's completely unchecked I love that, I love that Okay, so penultimate question before we get into the standard ones Let's say a speaker does want to raise their fees And maybe we've covered this and repositioned their brand What would you advise them to do to make that work? I don't want to destroy anybody's business One is out there, for example, and they're charging a thousand pounds for a genuine conference keynote In the UK, that would be the very, very, very cheap end of it That would be communicating

47:21I don't think I'm very good, maybe take a chance on me I'm not going to say to the person like that You need to be five thousand pounds, that's the average We'll apply by five over night Because the danger then is Particularly if you're starting out You came for any work to come in, you know, you don't lose it all I would say continually push your prices So each time a new opportunity comes in, stick another ten percent on Because ten percent compounds quite quickly So if over the next year or so Or eighteen months, there are ten opportunities And every time you increase by ten percent, ten percent, ten percent I've got the calculator with me But you've gone from a thousand to multiples of thousands Quite quickly So do it in a testable methodology Where you're not betting the whole of your business No, I'm five thousand pounds now

48:22I'm sitting here waiting for the work to come in That was not raining I don't want to do that to anybody And it's exactly what I've done I didn't spend a year or two at a lower price I think, right, okay, I've nailed it now I've now got a book, I've now got a show reel I know I can deliver it, okay, right I'm going to go from this price to that price tomorrow No, I went up to there and then up to there I have had some, a few years ago, I did a 40 percent price increase over nice Because I think this is working It's taking a long time Honestly, yeah, looking at where I am now I don't think I'm increasing my prices fast enough Right, catch up, 40 percent And everything, there was a little bit of a dip And then it all came back So the busiest I was Two or three years ago But charging 40 percent more Yeah, interesting Although using your own logic Perhaps it should have been 41.24

49:24Just, just... That has occurred to me as well And the reason I didn't do that is because all of my prices were already precise And if the 40 percent had meant that any price ended up in a five or a zero After I had applied the increase I'd have just added another pound on So it is out of 30 percent or is 40 percent plus one pound I love it So to wrap things up before we go into the standard questions If our listeners only took away one pricing principle from this conversation What do you think it should be and why? There's a fundamental one, as I said earlier It's not the customer's job to work out what value they're going to get from you It's your job to clearly communicate that value And to give them a little bit more flesh around this When I'm working with a client, the way that I approach that is this

50:25There's a guy called Peter Drucker wrote a paper called Marketing Myopia And in it, you know, he said nobody wants to buy a quarter inch drill bit What they want is a quarter inch hole in the wall But nobody really wants a quarter inch hole He was making the distinction between features and benefits But nobody wants a quarter inch hole in the wall What they want is a quarter inch fixing Nobody really wants that what they want is a picture hook or a shelf But nobody really wants that what they want is to make the room beautiful Or to improve the space utilization in the room So a methodology to try and figure out what value you are genuinely delivering Is to try and think through what are the criteria that somebody is going to choose My product, my service, my work, whatever it is What are the criteria that are in the head that they're going to use to decide between me And an alternative solution So if it's a speaker for a conference, you know, it might be your reputation in the marketplace The responsiveness, how quickly you get back to them

51:26The social media presence so that you can promote the event Yeah, there might be a list of criteria But that's just a how, that's just the features So for each one of those, keep asking me Or why do they care about that? Or why do they care about that? Keep asking that until you reach something that you think Ah, that's the real fundamental value What I generally find with clients when I do this is There might be ten criteria that we list When we do that drill down, it always ends up with maybe two, maybe three Fundamental pieces of value So they become the co-messive Why do you want to book me? Why am I worth £5,000? Because I'm going to, I'm going to get you repeat bookings next year I'm going to get you the highest I know customer satisfaction scores that this conference has ever had

52:26Maybe play the two things, how am I going to do that? And then it's those first criteria things It's by delivering those things except for me well But we start with those fundamental value bits So that's the methodology If people struggle more I don't really, I find it hard to put into words exactly what the value is That's one way of approaching it But absolutely fundamentally communicate your value Smashing, thank you so much You've shared such valuable advice today And guidance for people on this issue of pricing Which I know can really get people stuck And procrastinating and stop them from moving forward So it's a real benefit to have you on the show So that's brilliant Now before we point people to where they can book you to speak Book you to consult with their organisation or work with you

53:26I want to ask you a few questions First question is this, what's the best thing that speaking has done for you? I think the community I've never yet met a speaker who has chronic stage fright And somehow gritting their teeth and going through it anyway All of us, there's an element of We enjoy being in front of people All of us, I think we enjoy the Making a difference to people's lives Everything that we do, it's impacting somebody somewhere somehow When we stand on this stage, we change lives So all of those things are part of why we do what we do And that's part of why I enjoy being a speaker But I think some of the best thing that the people have met The professional speaking in the association, particularly, is a fabulous community

54:29Really, really nice people I relish the times when we have an opportunity to get together And talk to each other and over a few points A few more It's fabulous I should say, not just in the UK worldwide I went and spoke in South Africa Three years ago in April And one of the ladies that have met over there, Joe Anita I still had a WhatsApp with her just last week We're continuously in touch There's a guy called Martin That company knows his surname properly Laksh, Les, Golnick Austrian But Martin, really, really nice guy It's fun to him this morning So the people have met in the state The just as a group Genuinely, really, really nice people That's a joy to spend time with

55:30And build these relationships for these communities Brilliant, thank you for sharing that And I think that is something that you can feel quite lonely as a speaker sometimes So finding a community of like-minded speakers can be really beneficial to you From a well-being perspective But also from a business perspective Because you get to share ideas and tactics And all that good stuff But not a progress, even a tenth As far as I've come without the PSA All the generosity of advice and suggestions And chances to try things out and get feedback Talking to watching other people do things The whole- it's a fabulous community Brilliant, thank you for sharing that And next question is around a time when you have spoken And it didn't go quite to plan

56:30And you're like, I don't want to think about that Has that happened to you, David? Just ten days ago So, I said I create bespoke examples When I'm talking to the CEO groups And I cover sick pricing concept One of them is volume So the value bit I pick One, maybe two of the companies Where they've got a website Which might be very pretty You know, it might function very well But it talks a lot about way And when we were established And it does all the things I was talking about earlier So I'll pick that I'll show, you know, look I'll even then paste all of the content into a slide And highlight the number of times We talk about we and us an hour Versus how many times we talk about you And then I'll create a new web page With a little bit of help from Trackly PT You know, I'll create a new web page Based on their existing website That just focuses on the value communication

57:32And I must have done this A few hundred times And every single time The person from that company They've got their cameras And they're taking photos of the new content So I'm talking to my web developer First thing in the murdering Until ten days ago The guy took real umbrage And he felt like he'd been ambushed I created a really I got terrible scores And this is a Vistley session Vistley scores matter Because of the chairs Book you based on those scores I've written an email to apologize to him Because I don't know that it's not meant to be a number It's meant to be I've just picked one out of there I could have picked almost anybody I picked one out But here's how he could be done better But you didn't think so So yeah It's fresh in my mind Because the scores are still forming

58:34Will that make you change How you approach that going forward That experience? I have Because the It's not so much that I used him If that's how I used him without talking to him first So two hours ago I've got another gig tomorrow morning I figured out who it is that I'm going to be using two hours ago I spoke to the two companies Whose website's I'm going to Do the same thing with And they were Oh yeah, great Fantastic, fabulous And that's the reaction I've had 99 times previously But I want to avoid that That hundredth time I don't want that to happen again Oh yeah, yeah You're doing this for 16 years I've a hundred of these And still Yeah, yeah It's really interesting, though But we're always As speakers, we're all with learning And evolving Creating our content And approach To make things better

59:34That we can make the difference to the audience But yeah, it's just But back on you Specifically, because you came to my reach And you did a session in the afternoon on storytelling And the This particular session that didn't work well It wasn't ten days ago It must be three weeks ago, three, four weeks ago Actually, in there So this is How to price your plate It passes my main thing And I've done it three, four hundred times I've got a new version How to value your platypus Which is focused on How do you choose the price in the first place And how do you communicate value It's really focused on that bit And I found a couple of Vista troops who were prepared to be test subjects So didn't charge, just went along And returned for me Coming and doing it They gave me feedback I improved on the back of that And then I was comfortable I had something and it worked Did it with a few more people Road it out And I've done four or five

1:00:35CEO groups This one three, four weeks ago It was the first Vista group And it bombed Probably because of the reasons I've just explained But it bombed But it got me It got me thinking about just Why? Why was it not clicking? And I came along to your storytelling session And you were talking about the structure of the story And you know how you put things together It wasn't a direct thing that you said But what you said Just generated something in my head It was like a light bulb going off an epiphany And I went back I spent a day restructuring And rebuilding the content It's all the same content But now told in a more story-like manner My scores with the one that bombed Were two or three out of five I did it again for the A different group for the same chairman Ten days after the That first session The scores were four point eight two

1:01:35And you know to five And things like that So big thank you to you But we are continuously learning Yeah Like I say, 60 years of experience And you said something And it really triggered something in my head Like I say in the epiphany Oh, good I'm glad I made a difference to you And I spent that time Which is exactly what you were talking about Thank you for the feedback I appreciate that, David Cool, right Last few questions What's the book that has had most impact on your life and why? From a fiction point of view Probably Lord of the Rings And it's partly what got me into science fiction fantasy And there was a Period in my teens When it was my Christmas book Every single year Outcame Lord of the Rings I read the thing covered to cover again So from a fiction point of view Probably that one And that's probably the fiction book I've read more than any other From a non-fiction book Thinking fast and slow, Daniel Kahneman

1:02:36Which is just a fabulous insight Into how Inside our head It feels like we are completely logical Reasonable, you know, insensible And every decision that we take is Fundamentally grounded in logic And in reality We're just this complex mess of these hidden shortcuts That we rationalize after the event And really, really interesting insight into humans And that's not just from the pricing point of view Fundamentally marketing is about trying to influence other humans to do things And the better we understand how we take The more effective a marketer you can be In fact, people, anybody listening to this The absolute best podcast in the world is Sarah Arches Clearly The second best podcast in the world is something called Nudge

1:03:39Phil Agnew And what did it do? It's half an hour once a week And he talks about the psychology behind some marketing thing You know, I mean, he talks about the paper, the research and how it's applied And there's a fabulous back catalogue If you have anything to do with marketing sales influencing anything whatsoever That podcast should be on your list Brilliant, well, I'll give that a listen as well So I'll put a link in the show notes to the books And that podcast for people to go and check it out Smashing, all right, penultimate question What's the best bit of business advice you've had and why? I think This relates back to the being a high blue as well There was a recall When I had the senior role in an organisation called Premier Final I was running one of the brands It could be called CPC And I reported into the Europe, Asia and Pacific,

1:04:42a pack, whatever, who was CEO So basically there's a CEO in America And there's a CEO, the rest of the world And we had a meeting about something And there were three or four of us, we got together And before he let us start He made us really focus on exactly what's the question that we're trying to answer And that's the number of times we go into something We just dive straight in Oh, solution I think I've heard what it is, right, okay This is what we should be doing And he made us take a step back and get absolute clarity on it What genuinely is the issue or what is the question that we're trying to answer And only then did we start to work on it And that is so powerful I mentioned Vistage I was actually a member of the equivalent of Vistage, something called ACE The Academy for Chief Executives for 10 years Vistage brought it, it's now rolled into Vistage And the issue session that I talked about in the afternoon The number of times somebody would bring an issue along

1:05:44And then we go around the table asking questions And then once everybody's uncovered all the background Then they could give advice The number of times the advice from somebody was That's not the issue The issue is really this Because they'd listen to everything And they'd heard and seen something And you're looking at this the wrong way That's not the problem you're trying to solve It's really this And that is such an important thing Really be clear about what it is that you're trying to work on solve And so whatever it might be Yeah, there is definitely a correlation between the quality of the questions And the quality of the solution Okay, last question If you could have one mentor David And I can be alive or dead Fictional or non-fictional Who would you choose and why? It's a bit of a weird one And he is still alive, but it might be Billy Connolly

1:06:45Cool And it's because I'm glad that's at least one Billy Connolly in the world I remember decades ago He was doing the world tour things He started off the world tour of Glasgow He did the world tour of Scotland I think it was This one was the world tour of Australia And he was telling that one story where he decided finally He was going to get his nipple pierced And he went into where it was and they did the job And after they got into the job He looked to Billy Connolly said Now there's one less of them and there's one more of us And I'm glad there's one more of him Or there's at least one of him in the world Because every time I've ever watched him He has a joyful life And a sideways way of looking at everything And I don't want to be him But having something like that as a mentor Who can show you the different way

1:07:47The off route way Just thinking about things And finding the joy in it all Because every single thing that he did He'd just see it together Biggest, you know, those out of I think that that would be great to have something like that Helping and guiding you I think that's brilliant I don't think we've ever had Billy Connolly as an answer But I can absolutely see why you would be suggesting him He's definitely one of a kind And it's a shame there's not more like him Like you said Excellent Well, David, thank you so much again for sharing All of the experience And you know, the years that you've put into this To get to this point And to share that knowledge with us And give us some really tactical, practical tips And tools to increase our prices And not fall into some of those traps That tend to sabotage people

1:08:49Really, really appreciate it And good pleasure Good, and if people want to come find you Where's the best place for them to go? My website's the easiest thing And it's www.Davidabethspeaker.com No hyphons, Davidabethspeaker, two bees, two teas Brilliant, and I can absolutely recommend David as a speaker Now, I'm probably the worst person to watch speakers Because I'm, you know, you kind of dissect things But you absolutely, you know, captivated me And it was really, really useful Really good stuff So highly recommend Good, well thanks so much David You look after yourself and thanks for coming on the show Oh, it's been the total pleasure I loved it There was a lot in there, a ton of value And David always brings the goods I've seen him speak, as I said, in the show And yeah, he delivers every time So I'm absolutely chuffed that we're able to tap into his brilliance on the speaking club

1:09:52Now, there's a few things that really stood out for me First of all, this idea that pricing isn't a numbers problem It's a value communication problem And this is something that I see all the time In terms of speakers positioning their message And packaging their message in a way that really clearly And quickly articulates the value that they're going to bring to whoever is booking them Because if people don't understand the value The price is always going to feel too high Second, the reminder that confidence in your pricing doesn't come from picking the right number It comes from being clear about who you deliver for and what you deliver And finally, this is a big one for speakers Discounting isn't a strategy It might feel like a quick win But over time, it chips away at your positioning and your business

1:10:54And I also love those psychological tips And packages and number endings that are also going to be really useful To tap into that psychology of buying that people have So if you have been sitting on your pricing or second guessing it or undercharging Maybe this is your nudge to revisit it And if you enjoyed the episode then go and check out David's website, his work He's also got a book, the Platypus pricing process And I'll pop all the links to those things in the show notes for you And if you know another speaker or business owner who needs to hear this Send it their way Also you've got a value going say hi to David on LinkedIn I'm sure he will appreciate that too So until next time

1:11:54Firstly I want to say thanks so much for watching or listening to the show We understand your time is precious Hope you got a ton of value you thought it was worth the investment today And if you did and you are listening to the show for the first time Maybe subscribe so that you get these nuggets every time we publish an episode And if you're on YouTube subscribe Leave a comment with a brilliant, let us know what you thought If you've got any questions that you might want David to respond to Bungam in the comments And if you are listening on a podcast then it'd be amazing if you could leave a rating or review You can do that where you're listening or super easy Take a couple of seconds or more like I guess 60 Go to ratethispodcast.com slash TSC And that would be amazing if you could take the time to do that if you've enjoyed the show So all that's left for me to say is thank you again for watching and listening

1:12:54It's been amazing to be with you again And don't forget until next time To go out, grab your life by the nuts and get cracking Bye bye It's a nightmare You're an expert with so much to say But now that you've been booked to speak You're struggling to know exactly what to talk about You want a talk that engages the audience and wins you new clients Without you losing your personality or anyone feeling pitched too But what happens when you sit down to create that talk Is that you end up staring at a blank page for ages or worse Surrounded by hundreds of sticky notes with content that you could include With so much material you just don't know where to start Or finish Don't worry because many experts like you face exactly the same challenge And that's why I created the blank page to stage guide In just 15 minutes this breakthrough resource is going to help you identify the big idea of your message

1:13:59Make it relatable for the audience that you're speaking to And convey it all in a way that gets the audience inspired and on board with your idea And it works even if you have tons of material or your subject feels less than exciting If you want to cut through swathes of content And get a talk that you're excited to share Your audience loves and wins you new clients Then grab your blank page to stage guide from Sarah Archett of code.uk Slash new guide hyphen tsc Oh I forgot to say it's completely free Enjoy! Thanks for watching!