How to Charge What You're Worth (Without Driving Customers Away)
If you've been following the Go Narrative blog, you know we talk a lot about the power of storytelling and its potential to improve your marketing efforts. We've already discussed how story can drive conversions and increase your sales pipe velocity. But did you know it can also help you generate more revenue per unit?
That's right: A well-planned, well-told story can actually make customers want to pay you more for your product or service.
When a company is first starting out, they'll often charge a lower, more competitive rate to get customers in the door. The problem, though, is that they struggle to increase their prices over time to match their true market value. When handled incorrectly, a price increase will almost certainly drive your customers away. However, when you introduce storytelling into the mix, your customers will not only agree to a rate increase but welcome it.
Why value is more than a dollar amount
Have you ever used a product or service that provided so much value to your life that you would willingly pay more for it than the company charges? Maybe it's a niche streaming platform or a premium app that streamlines your business, or a box subscription service that helps you discover amazing new products every month.
Whatever it is, this particular company has done an excellent job of communicating and proving its value to you as a consumer. And if you received an email tomorrow saying their prices were going up, you wouldn't think twice about paying that higher rate.
Now, think about your own customers' experience with your product or service. Do they feel that way about your business? Have you properly showcased your value, to the point where they would willingly agree to a price increase without batting an eyelash?
This idea of communicating value is the exact intersection between product marketing and storytelling. Now, you've probably already thought about the value your product brings to customers as you were developing your value proposition. You've done your due diligence, built a hypothesis about why people would want to use your product, tested it in the market, and feel confident about the benefits and tradeoffs of using your product – the "gives and gets," as we like to say. But there's still more work to be done from here.
What's missing from the average value proposition is a temporal change – a "before and after" shift where customers can visualize themselves going from one state to another over time. If you don't factor in the temporal aspect, you're missing out on harnessing the power of storytelling. (We talked about this in greater detail in our last blog post, if you're interested in learning more.)
I recently came across a perfect example of a hook that encapsulates this idea of storytelling as a state change:
"How a retired fisherman became the highest-paid programmer in Silicon Valley."
Reread that sentence. It's an excellent example of short-form storytelling, one that articulates this all-important temporal change in a single phrase. You've got a character (the fisherman), a temporal change (being fisherman to being a programmer), and the achievement of the desired end state (highest-paid programmer).
There's a lot packed into that one, brief statement. I found myself thinking – what would a similar statement look like in a piece of marketing collateral for a SaaS CRM company?
I came up with this example: "How a frustrated salesperson went from struggling in their job to winning the President's Award for highest sales three years in a row." To me, this is a pretty good articulation of this particular CRM's value to a potential customer reading that statement.
There are a lot of explicit and obvious wants somebody would have when shopping for a CRM. They want a single place to manage their customer relationships so they can streamline communications and ultimately improve their sales. The challenge is, this is the base level that every other CRM company needs to meet with its customers. It's not enough to only talk about that aspect of your value proposition.
If you want to not only get people's attention but to build more value into your target market's understanding of your product, you need to be able to trigger interest. It would help if you made a personal, emotional connection that makes them remember your product out of all the others on the market and inspire them to act on it.
Digging deeper into unrealized needs
Every business has an "obvious" story they can tell their customers about their value proposition. In the above example, it's about being a salesperson and how your CRM tool can help them be more effective. To add value, you must identify the non-obvious benefits – the unmet or unrealized needs somebody has around being a salesperson – and then start to surface those aspects through a "before and after" story of change.
How can your business effectively use storytelling in marketing materials to express this temporal change to customers and prospects? The first step (which every marketer knows) is to do the legwork of deeply understanding your customer. You'll need to consider their entire buyer journey (yes, even before they come into contact with your brand) and how your product fits into the context of their lives.
Then you need to learn about the basics of storytelling and the various structures you can use to construct a compelling narrative (we're fans of a model we call the 3Ds – "desire, difficulty, denouement," which we often reference in our blogs and our client work).
Now you're ready to start creating net new stories that you maybe wouldn't have created before!
Let's check back in with our friends at the CRM company we mentioned earlier. The best thing they can do is come up with stories about the temporal change their customers might experience when they start using their product (e.g., the struggling salesperson who has now earned a sales awards thanks to help from the CRM). The company needs to think about those stories in-depth and create distilled versions of them on their website. This might involve building case studies, infographics, whitepapers, and other content that aligns with and demonstrates the transformation you want to highlight.
The key here is to share content that allows customers to quickly and easily recognize your product's high-level value, which they can use to distinguish you from your competitors. If people aren't getting to that point quickly and easily, how are you any different from any other CRM on the market? Remember, the harder people have to work on your website to understand these things, the more friction it creates in the user experience, and the harder it will be for them to grasp the value.
The Netflix example: A clear, immediate display of value
To illustrate what we mean by articulating your value quickly and easily, let's look at an activity that many of us are intimately familiar with: scrolling through Netflix to find something to watch.
On a recent episode of Last Week Tonight, host John Oliver joked that the No.1-rated series on Netflix is "40 minutes of looking through the menu for something good." While the episode had nothing to do with Netflix itself (Oliver was illustrating the point that Americans like choice), it does highlight something very interesting about the value we find in the popular streaming service -- which, incidentally has raised its monthly subscription fee several times in recent years.
The reason we don't all cancel our Netflix subscriptions every time the company hikes up its rates is that we don't want to lose the tremendous volume of interesting, exciting content it has to offer, not only for us but our entire family. There's entertainment for all ages and tastes, and to us, it's worth it to hand over an extra dollar or two per month for continued access to such a vast media library.
To John Oliver's point, many of us do indeed spend quite a bit of time watching multiple preview trailers before we decide what to watch on Netflix. The platform does a phenomenal job of exposing people to the countless stories contained within, and get them so interested that they find it hard to make a choice.
The risk, of course, is that we don't watch anything and end up closing out of Netflix because we can't decide. But this is rarely the case; eventually, we make a decision. We find a story that draws us in and convinces us to invest 30 or 45 or 60-plus minutes of our precious time to that show or film. Even if we spend just as much time watching previews as we do watching the show, we decide on, and those trailers make sure we know what's available to us. It gives us a taste for it and invites us to explore further.
This is exactly what a good business website should do. People should see stories that give them a taste of what they can expect from working with you. Some marketers may argue that website content should be compelling enough to encourage an immediate conversion, but if people are taking their time exploring your content, diving deeper, and having rich, valuable interactions with your brand, that's a good thing. As long as they eventually make a decision, there's nothing wrong with a Netflix-style experience, where visitors stick around for a while to consume your stories.
You can measure the impact with reduced bounce rate, increased time spent on the site, and interactions per visit. Use A/B testing to prove the results to leadership.
From prospects who push back on price, to excited customers who willingly pay what you're worth
Netflix's standard subscription price changes represented a nearly 63% increase from 2014 to 2019. Now, it's far from the only company to raise prices. But think about how your customers might react if you told them, five years from now, they'd be paying over 60% more than they do today. They probably wouldn't be too thrilled, right?
It's very easy to scare people off when you increase your prices, even incrementally like Netflix does. So how do you make sure your existing customers experience so much value from your product, that they don't mind paying more for it?
The answer is clearly and concisely articulating the value of your product through the right stories. If you're struggling with this and getting pushback from prospects on your rates, it's likely because they don't understand why you charge what you do. You may know the awesome experience your customer is going to get by working with you – but do they?
As a company, you need to shift from communicating product features and benefits to communicating true added value to your customer's life. Think of your value proposition as a scale. On the right side, there's everything a customer has to put in to work with you, whether it's money, effort, time, or all of the above. On the left side are all the benefits they get from it. Before you start asking customers for more money, make sure the value on the other side of the scale balances out.
But the existence of value alone isn't enough to compel someone to part with their hard-earned money. The customer needs to be aware of that value and understand how it will considerably improve their lives. You need to tell stories that demonstrate the desirable end state your customers can get to by engaging with your brand. When you're able to show prospects this kind of value, they'll gladly pay what you're asking for and then some.
As a best practice for storytelling, make sure all the stories you choose to tell align with the value you want your customers to experience. When you do this, customers and prospects will see integrity and consistency in the stories in your marketing materials, and this will align with their experience of your product itself. Defining a brand or product narrative is a great place to start.
If you're not quite sure where to begin, let Go Narrative be your guide to a new, story-driven path to marketing success. With the right stories and the right understanding of your customers, you can communicate your value and confidently achieve the revenue per unit you know your product is worth.
Book a complimentary 30-minute consultation with Go Narrative to discover how we can help you articulate your value and tell the most effective stories to your customers.
Go Narrative is a Seattle Based marketing firm that assists business leaders in technology companies to build and implement advanced marketing strategies. Our secret sauce is storytelling for business growth and transformation. We can help you cut through the noise and improve your reputation. We love helping business leaders understand, use and apply storytelling in business via writing, presentations, video, strategy and actionable plans. Get attention. Be heard. Sell more.
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