Are you providing premium options to your customers?
Providing a choice of tiered pricing and services can make a big difference to your bottom line.
If you are missing this secret, then your clients are missing out, too.
Did you know that 30% of clients will take you up on your higher-priced option offer if it makes any sense at all?
While you are thinking about premium options, consider the big picture of tiered pricing (or offering differing levels of services at distinguished price points). It can be much more profitable than providing a singular option if done well.
Most businesses use tiered pricing and options because it offers both flexibility and access to customers within all price points. As an example, major shipping carriers offer several shipping methods so that it’s affordable to everyone, yet still convenient for those who need expedited services.
By adding a basic and/or premium selection to your offerings, you give customers a chance to try your services at a comfortable price point and, after you provide superior value, that makes them more willing to climb the spending ladder.
By using this secret, you are also taking your competition off the table by offering everything a potential customer needs.
Good, Better, Best?
Presented with what looks like the good, better, and best choices, it’s human nature to want the very best. When you implement the premium option secret, your prospects gain a clear understanding of what you can do.
Which brings us to Commandment #1 in pricing and packaging.
Thou Shalt Always Have a Premium Option.
As a tourist, I’m faced with this marketing strategy every day.
When I was in Chicago for an AMI event, I rented the most expensive bike to cycle along the promenade and the city’s trademark skyline. Watch this video, and you’ll see that the person who opted for the cheaper option has a little trouble. She rented a cruiser bike for $25/day. That’s what a $25 bike looks like cycling.
Of course, you can get the premium option instead — mine, the bike with gears for $35.
Chicago follows Commandment #1, not only with bicycle rentals but also at Soldier Field. It is the city’s major stadium for many reasons. For one, the Chicago Bears play here. Another reason probably has to do with their marketing.
They offer a premium option that attracts ideal clients like a moth to a flame. You can do the normal tour or the VIP tour. There’s a lot of sports fans who will pay a premium price to walk on the field — an amazing opportunity.
A novice business owner would say: Let’s just have a tour and charge $15. That’s our tour, I hope people come. But if you’re really good at pricing and packaging, that kind of nonsense stops you in your tracks. Next step, strip some of the stuff from the original tour idea and add it to the shiny trophy version, the VIP Tour.
Here are two examples of design proposals that offer multiple options: