Melanin & Marketing: Pricing, Sales, and Startups
Wait! What?! Melanin & Marketing…that’s a thing?
Yup. It’s this Facebook group that we started late last year to address all things marketing related to people of color; you know, the little snafus that companies run into when marketing to people of color because – well, Black Twitter will drag you into Black Twitter oblivion. More importantly, Melanin & Marketing was created to help and support Black-owned businesses, Hispanic-owned businesses, Asian-owned businesses, and pretty much any business owned by a person of color. All are welcome to join, BUT you must adhere by the rules. It’s a place that’s for us and by us (if I were to use the FUBU tagline). It’s a place for learning, growth, and collaboration. If you are there to create disruption and dissent, YOU WILL BE BOOTED.
Speaking of learning – do you like that pivot? – here’s the first of what I hope to be several Melanin & Marketing roundups, or summaries of what we’ve been discussing in the group.
THE TOPIC: PRICING & SALES
One of the most frequent complaints I hear from both service and product-oriented startups is that people don’t want to pay their fee. Potential customers either want it at a discount (i.e. they want the hookup) or they want it for free, gratis, Pro Bono.
The knee-jerk reaction is a hefty, “Bye Felicia.”
Before you give Felicia a hefty-farewell, here are some things to consider.
- Pro Bono isn’t always bad. Providing products or services for free isn’t always bad. Freebies may not add money to your pocket in the short-run, BUT, the customers you gift services or products to may be your best advocates. They could direct so much business your way, you have to start turning people down. And secondly, you’re a startup. You have a ton of hiccups to work through. Use the customers that you provide free products or services to as a means to improve your skills. Ask them for feedback. Be critical to your own work. Give yourself a more generous timeline than you would a paying customer. And finally, try to get something tangible out of the deal. Build your portfolio with the work you do for these customers and/or ask them to provide testimonials. This could be more valuable than pay for a startup.
- Discounts aren’t always bad either. Once again, you’re a startup. Your business isn’t all that and a bag of chips…yet. Like I said before, you have a ton of kinks to work out. Even if your product is right, there’s a good chance that you have some behind-the-scenes kinks to work out. Your pricing model may be off. It may take you longer than you thought to actually produce the product. You need the time to learn what you don’t know. Providing a discount can help with this. And more importantly, providing a discount is a great way to gain customers. While you may not want to build your business on a discounting model, you do NEED customers. This means that you can’t come out the gate charging what XYZ business charges for the same product. It just doesn’t work like that – at least not all the time. You just have to be honest with yourself; you’re a start up, not a household name yet.
- You may have pricing problem. This could be an indication that you have a pricing problem or are targeting the wrong audience. One of my biggest speeches about marketing is that “it’s not about you.” This is why we do so much research about WHO our target market is. Stop trying to market to Don’t get discouraged. Instead, research, reflect and adjust accordingly.
- You may have a target market problem.
- You may have a branding problem. Story time: I’ve been going to the same dentist since before I had braces. I got braces in the 5th grade; I’m now 37. As I was growing up, my dentist kept up with my life…asked me about school and later about work. I have moved from my parents paying to me coming out of my own pocket. They greet me by name, compliment me, educate me on what’s going on, keep their technology on point, and text and call for appointment reminders. And they’re super responsive. So yes, I somewhat eagerly dropped this $500 for this unexpected crown for a broken tooth. Moral of the story: you want to be a premium brand and charge premium prices, then act like a premium brand. You set the atmosphere of whether you’re perceived as Walmart or Neiman Marcus. (Bonus: Your language has a lot to do with how you’re perceived. Do you do photography or eloquently capture the moments that matter most? Think about it. People who do photography come a dime a dozen, people who eloquently capture the moments that matter most may be harder to find. Perception, perception, perception)
- You may not be a confident communicator. This article, How to Price a High-End Brand and Get Your Ask, speaks to my heart. As the author puts it “Step One: Be confident enough to be able to say the price with a straight face. Practice a thousand times if you need to…” I used to have the hardest time with this. When I first started, I didn’t know my price. Above that, I was AFRAID to state a price. I thought no one would want to pay my price. I was right. There were people who didn’t want to pay my rate. There are STILL people (and by people, I mean organizations) who don’t want to pay my rate. The good news is that I have enough income to say “no” to people to don’t find value in what I offer. It’s okay to say “no” to those people and yes to yourself.
