How to Set Fees for Your New Consulting Business – The Art of High Ticket Sales Ep. 7

– Let me give you a metaphor: The idea of charging a low price to start off with in the marketplace. First of all, that’s how you would be perceived in the
marketplace, you’re cheap. It’s like in dating. Imagine this: how many of you
are single by a show of hands? Single, how many of you are
single and you admit it? Put it nice and high. No, no, put it nice and high, serious. Nice and high, nice and high. Look around the room, look around it, see if there’s anything you like. (laughter) That doesn’t hurt, you know? Entrepreneur, you’re doing
business, it doesn’t hurt. You gotta market, right? – [Narrator] The King
of High-Ticket Sales, World’s Highest-Paid Consultant, Media Celebrity, Multi-Millionaire Entrepreneur, Acclaimed TEDx Speaker, International Best-Selling
Author, Dan Lok. So, (laughs) “see anything you like.” It feels like you’re picking
meat from the, you know. Anything you like there, right? I like that, you know. No, okay, in dating. So let’s say you are single and you are looking for, you know, a meaningful romance relationship. You’re looking to get married and you’re looking to
find a soulmate, okay? And you want to do that, and you want to get out
there in the marketplace, but you thought to yourself,
“But you know what?” “I haven’t been dating for awhile,” “I’m kind of new to this,
I’m not very polished.” So what I would do is, I would just, because I don’t want to
scare the marketplace, so I’m just going to lower my value, I’m just going to go on
a bunch of cheap dates. I’m just going to go on a date with anyone that doesn’t have bad breath, I will date them. (laughter) You know, I would go on a date. And you go on a lot of these cheap dates, and the words get out
there that you are a person that goes on a lot of cheap dates. The words get spread, now that’s great, now you have a great reputation. And you believe if I do enough of that, then I will find that
meaningful relationship. Then I will find the spouse that I want. Is that how it works in life? That’s not how it works in life. You have to set the
criteria that you want. Who are you looking for? What will you tolerate,
what you won’t tolerate, who’s the ideal “client” or ideal partner? You can’t just lower expectations. Well, I guess I’m kind of
desperate, I’m getting. Ladies, I’m 30 years old
next month, and shit. My mom is pressuring me,
I should go on a date. No, no, no, no, no, no, no, no. No, you gotta start here. So in the marketplace, when you start low, the words get out there,
you’re stuck at here. People think that’s how much you charge. Now what happens is, you
do that for let’s say one, two, three years in business and now you say, “Now finally
I have the testimonials,” “I have the credibility.” “Now I’m going to raise my prices,” right? What would your clients,
existing clients, say or what would the marketplace say? What the fuck? You’ve been charging this
for many, many years. Suddenly you want to triple
your rate, you greedy bastard. Oh, but I’m delivering more value. I don’t care, you charged this. Why are you tripling your prices? Well, but that’s what I wanted
to charge right from day one. Then why didn’t you charge that? You start with this! That’s the difference. A Chanel bag is a Chanel
bag is a Chanel bag. That’s why they don’t discount. That’s why Hermes don’t discount. Ferrari’s don’t discount. To picture this, any ladies
like Chanel bags, Chanel bag? Just one, two? (laughter) Okay, thank you for your honesty. So let’s say you want to buy a Chanel bag, and let’s say, pretend I
have a Chanel bag here, okay? And I say to you, “You
know what this Chanel bag, used but great condition,
great condition, it’s $20.” “You want one?” Right? You’re like, “No.” What are you thinking? – [Woman] It’s probably fake. It’s fake, what’s wrong with this? Right, that’s the thing. But if I said, usually
the retail it’s $2,500 and this is $2,000. Okay, that’s more like it. That’s more like it, that’s
what I’m talking about. So pricing itself, please write this down, pricing itself is a marketing strategy. Pricing itself, done properly,
it’s a marketing strategy. Because there’s a segment
in the marketplace and the majority of the
people in the marketplace, they perceive higher price
equals higher quality. It may not always be the case, but that’s how a lot of people think. Higher prices equal high quality. (dramatic music)

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42 thoughts on “How to Set Fees for Your New Consulting Business – The Art of High Ticket Sales Ep. 7

  1. Summary of this quality video:

    Do not start with low price and then raise it. Start with high price and discount it if need be.

    This is where video advice ends. Are you curious how prices are actually chosen?

    1) you see what the fees are from your competitors for equivalent services.

    2) you gauge how mature they are as entrepreneurs. If very mature you can network with them right away. Ensure there is understanding regarding price. If not network once you get some traction and offer win-win proposals and open line of communication. This is important, and probably the key step as you need to tap into synergy or if its not there, build it.

    3) generally start at the market expected range as Dan mentioned. Even if you feel you will need to grow into it, and give discounts.

    4) you aim to build brand loyalty by acts like rewarding repeat customers.

    There are

  2. I can still remember the first big invoice I dropped on a client in the 1980's it was for ten times what I was used to earning for the hours worked I felt like I was stealing from them.

  3. Dont set a low price at the beginning to attract client as it will cost problem in the future when you raise your price!

  4. A question here Dan. So let's say you're known in the marketplace as being cheap. Would you consider rebranding yourself and forming a new company to use as an alias? In a previous video, you talked about how your mentor told you to double your prices continuously. What was your process for doing that while keeping your reputation in the marketplace?

  5. My takeaway, is simply to feel the client out first, and everything else that follows would most likely lead to a satisfactory sale. Thanks Dan.

  6. I only ever did 1 free coaching call and I quickly realized how little commitment there was on both sides because I did it for free. Great lesson here.

  7. This is so spot on. There is a term that goes, "You have to hump a clunker, before you can fuck a ferrari." It's so messed up because this is how our society thinks. Lets lower our standards than once we become "good" we will charge what we "deserve." It's bullshit. Set the bar high. You want higher quality clients, charge more. If you charge less, they will view you as a discounted not so good (fraud) service. If you are uncomfortable charging more, you are most likely not confident in your service/product which means go find a new fucking product/service.

  8. The smart road…build your business and offering and charge accordingly from the outset. It's more about margin than revenue.

  9. Pricing and marketing are also just a huge play on Psychology – if it's expensive or exclusive, it must be really valuable and worth it!

  10. “Higher price equal higher quality.” Bu doing that we can eliminate cheap and difficult customers while targeting sophisticated and affluent clients. Thank for sharing, Sifu!

  11. even at times you can find a lower cost item is of good quality, most equate high cost item to be of high quality (HTC group 3)

  12. Pricing a self as a marketing strategy, when done properly

    Because there's a segment in the marketplace, the majority of people in the marketplace perceive higher price equals higher quality

    It may not always be the case but that is how a lot of people think

  13. IM refuse to sell myself short. In fact, IM take my powerful perspective & expert knowledge off of sm. Why plagarists hate MI know my worth. Not going to allow weaklings to play MI small.

  14. Love your videos, I am taking notes every day, sometimes new things, and sometimes just a confirmation of what I think, but all great and very "listener friendly". One thing though: Does this one not contradict with the episode where you told you increased your price ten folds? from 1000 to 10,000? Is the difference that you did it very quickly?

  15. I truly appreciate your natural sense of humor. The way you use analogy is absolutely remarkable. You always make me laugh while I learn LOL!

  16. I really like you and learn from you. But why do you market yourself like that? It’s almost like a fake person the way you market yourself.

  17. there is difference about your own perceived value and your real value, i don't agree, its not about how much you think you are worth but on what is the added value you can bring to the market and to your clients, if you have knowledge and your clients understand your value, then you can get what you want for or ask for what you want, but if you think your value is high but in reality you don't bring anything, no one will be interested, in that case, work smart and hard to provide added value…

  18. You might want to subscribe… no, I definitely do, I already did and that’s not changing anytime soon

  19. This is not true. If your product has no value then it's not worth anything.

    Otherwise the going rates for one-to-one personal services are between $100 and $200 an hour.

    This does not include psychiatry (which is a licensed medical profession) but does include things like hypnosis, reiki, meditation, yoga, aromatherapy, talk therapy, psychoanalysis, etc…

    Even the very best lawyers and tax professionals, after years of professional training, don't charge more than $500 per hour.

    Corporate consulting fees are a different subject. These can be very high. But you need to actually know something about business. Most of these people either have phD or have run their own successful business in the past. The later is preferable.

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