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CHEESE2009
01-31-2012, 05:09 AM
I found this article on Wiki, that may interest all of you.

LINK (http://en.wikipedia.org/wiki/Pricing_strategies)

In fact, I may actually use it's;

High-low pricing
Method of pricing for an organization where the goods or services offered by the organization are regularly priced higher than competitors, but through promotions, advertisements, and or coupons, lower prices are offered on key items. The lower promotional prices are designed to bring customers to the organization where the customer is offered the promotional product as well as the regular higher priced products

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This gives the impression that the service provided is top notch, yet they are able to receive this luxury with a discount! Smart.

Steve
02-01-2012, 02:24 AM
Scott,

Give us your thoughts on some ideas how this could be implemented?


The lower promotional prices are designed to bring customers to the organization where the customer is offered the promotional product as well as the regular higher priced products

Retail stores refer to this as a loss leader. Now, the thing I wonder is, can loss leaders be an effective tool when selling a lawn care service?

What's your thoughts on that?

How would it differ from a retail scenario?

CHEESE2009
02-01-2012, 10:26 AM
Let's say my lawn service can manage and profit making $70.00 per client.

I will advertise that my service is actually $100, but everyone get's $30 off!

$30 off, WOW!

I doubt clients will say, "Well, he was overpriced to begin with".
I believe they instead will say, "Wow, that's a great deal I've been given".

I think I read in the article or somewhere, and I also believe it to be true that higher priced items may represent higher quality. If a client thinks my service is high quality yet is not obliged to pay the standard and expensive fee, he/she will be thrilled!

^ this is similar to what Visaprint.com does I'm sure. It costs them pennies to produce a product, yet they make it seems so expensive, yet throw various discounts at us CONSTANTLY. It makes you want to buy all their stock! We feel like we're getting away with free crap, but we're really not.

IVPropertyMaintenance
02-01-2012, 11:10 AM
^ this is similar to what Visaprint.com does I'm sure. It costs them pennies to produce a product, yet they make it seems so expensive, yet throw various discounts at us CONSTANTLY. It makes you want to buy all their stock! We feel like we're getting away with free crap, but we're really not.

How true is that statement. I've often found myself compelled to get stuff from there just because it's "FREE" (Only then you find that by modifying it at all costs money, plus you have to pay for shipping, plus you get just enough to convince you that you need to buy more...).

That is an awesome point about the discounted pricing. I think the best thing to do would be to put a time limit on it. For example, a customer says "My roof and gutters need to be cleaned out, how much will this cost?". You then reply "You know Mrs. Smith, I'm actually running a promotion on roofs and gutters seeing as how it's that time of year again. Let me check it out and I'll be right back with those final figures for you". She is already convincing herself that this is going to be a SALE price and if it's a good enough deal, she might have to take you up on it. Say it's a $75 job and you tell her your normal price for a roof that size would be $100. You also tell her that anyone booking this service this week will receive 25% off. She knows that by not signing up for it, she is potentially losing $25 as it is a service she NEEDS done. If she is YOUR customer, she will either pay the $75 this week or will tell you it's going to have to wait until next week and end up paying the $100 which puts an extra $25 in your pocket next week. If you really want to make the customer happy, tell her that because she is such a valued customer, you will extend the sale for her exclusively.

I actually sold cars at one point which was an interesting job, yet it taught me a lesson in sales that I will never forget. Your job as a sales person is to make the customer feel as though they are getting a great deal. We work hard to develop our pricing methods, and sometimes even harder to fit it into their budget. I don't think any customer out there expects you to NOT make money. They just want to think that they are SAVING more than you are MAKING. Convince them you are doing them a favor and they will show their appreciation. When I sold cars, my happiest customers were sometimes the ones I made the highest commission off of. On the flip side, my worst customers, the one's that haggled me down on price to where I made a minimal commission, those were the ones that I had to deal with for weeks about little complaints and such. A happy customers who trusts you will pay the price you ask them to, as long as it's something they feel they are benefiting from.

Steve
02-01-2012, 02:34 PM
my happiest customers were sometimes the ones I made the highest commission off of. On the flip side, my worst customers, the one's that haggled me down on price to where I made a minimal commission

What do you attribute this too? How could one apply the same principles to lawn care sales?

Ducke
02-01-2012, 07:19 PM
Let's say my lawn service can manage and profit making $70.00 per client.

I will advertise that my service is actually $100, but everyone get's $30 off!

$30 off, WOW!

Scott
You are the Walmart of Lawn Care.

Retail stores refer to this as a loss leader. Now, the thing I wonder is, can loss leaders be an effective tool when selling a lawn care service?


Flower bed weeding is a great loss leader. I can do this real cheap but make good money on the Edging and Mulch.
When I worked in the Building supply Biz We sold Drywall at cost but sold the Mud ,Tape and etc.. with 200 to 300 % mark up.
You just have to find services that can be linked together.
You just need that little something to get you on the lawn then you can up sell or add on sales it actually can be fun to come up with challenges for yourself .
What I want to work on this summer is impulse buying.
Kind of like the candy bars or magazines at the store check out, Some thing you didn't plan on buying but as you stand there you grab it just because it there in front of you. I just have to think up what and how.

IVPropertyMaintenance
02-02-2012, 12:08 PM
What do you attribute this too? How could one apply the same principles to lawn care sales?

Steve,

This really all goes back to the salesman. Whether we think of ourselves as salesmen or not, we are (or at least need to be). Often times I find that if a customer is trying to haggle you with pricing, it is because you allowed price to become the biggest factor. If you sold your services based on the quality and demand for it, you automatically create more value.

Customers who you find complaining about the cost, the way you did the service, or just simply nit picking everything they can are the customers you didn't make happy. The customers who you have developed a relationship with (even in a short period of time like an initial consultation) and trust that you are being honest with them are customers who will be grateful that they found such a quality maintenance provider. Not saying that you should take advantage of these people, but if you can make up some income you lost do to having to drop your price for another customer, DO IT. How great does it feel to make money and make a customer happy? That's another mouth out spreading the word about you. A customer who feels like they got what they needed for a price they could comfortably afford will not complain as much as a customer who was not sold of the idea and feels like they could have gotten a better deal somewhere else. Again, our job is to convince them that we offer the best VALUE around. If they don't want to believe you, you're better off letting them go then deal with their complaints and possible bad mouthing of your business.

All in all, every customer is slightly different. The main point it to read or profile your customers to know what makes them happy. If you're customer isn't happy, they won't be your customer for long...

Steve
02-02-2012, 04:04 PM
This is a great discussion. Sometimes I think we all learn better from actual real world examples too.

Often times I find that if a customer is trying to haggle you with pricing, it is because you allowed price to become the biggest factor.

What's your view on how to not let price become the biggest factor?

Again, our job is to convince them that we offer the best VALUE around.

What kinds of ways do you suggest using to convince a customer they are getting the best value around?

joeblack
02-02-2012, 05:06 PM
today, while going door to door, I saw the same issue every couple properties... BUTCHERED CREPE MRTYLES. It bothers me more than any other outdoor service done wrong.
As I was going through the neighborhood i contemplated bringing the issue up to the homeowners (basically I wanted to bash their current lawn service provider or whoever has done this)
i wanted to get the forums thoughts on how you all approach a potential client and critique their yard

I kid you not every other house had crepe myrtles that looked something like this.
When I offer better value to clients, I want to let them know that i know what i am doing, not just copying what other lawn service providers are doing. and if i come across a plant, shrub, tree im not sure about; i will not touch it untill i research it and learn expert opinions about it

Steve
02-03-2012, 02:51 AM
What is your view on what you would say to the home owner about the plant and how would you use that to help your sales pitch?

IVPropertyMaintenance
02-04-2012, 12:55 AM
What's your view on how to not let price become the biggest factor?



What kinds of ways do you suggest using to convince a customer they are getting the best value around?

Steve,

Hey sorry I haven't gotten back to you on this in a couple days. Things have been busy around here.

As far as how to keep price from becoming a huge factor, I don't necessarily have a solution to that. What I can recommend is how to keep them focused on what SHOULD be the biggest factor. Many people have their priorities in the wrong order. They spend money of things that are important to them and try to haggle on things that are less important. Someone wouldn't try to talk the employee at the local coffee shop into dropping the price on their fancy latte, would they? No, of course not and that isn't nearly as important as keeping their yard from looking like a disaster area. We provide a service that is NEEDED. We need to stress the importance of having such a service done. Explain to them what could happen if left untreated.

Find as many ways as you can to get the customer to agree with you:

You: This lot sure is overgrown isn't it?
Customer: YES, it got a little ahead of us this year.
You: We're going to want to get this done soon, we wouldn't want it to become a fire hazard.
Customer: YES definitely, we wouldn't want that.
You: It's also important to keep the lot looking nice to encourage buyers, don't you agree?
Customer: YEAH that's true, I would love to sell it.
You: And obviously it will be growing back so we should think about setting you up on a routine maintenance.
Customer: YES you're probably right, it will grow back. How much are we talking about here?
You: I can work something up, we should stay focused and talk about what else you would like to see done here, is that okay with you?
Customer: YEAH that sounds great, let's go look over here...

See, you divert the topic of PRICE by spending the majority of the time talking about all that needs to be done. The customer sees that there is A LOT of work involved. Not only that, but it is a natural instinct to continue positive responses once enough have been given. If they spend the time answering everything with a YES, you can typically count on them saying YES when the topic of price comes up. The hard part is learning to read you customer well enough to know what to ask them to trigger as yes response.

As far as convincing the customer that they are getting the best value, this is simply something you need to show them in your presentation. A customer will base their decision off several things such as price, experience, knowledge, appearance, attitude, ect. Your duty is to show them through your presentation that you are the real deal. They need to feel confident that you will provide them with the best overall outcome. The problem is, they typically have to "give" in one area or another. If they pick the company with the lowest price, they might not get the company with the most experience. If you show them that you are experienced, knowledgeable, have a professional appearance, and good attitude, and whatever else they are looking for as well as having a price that is "within their budget" then you are the best value around. Convince your customer that they are lucky to have you not the other way around. There are thousands of homes in any area and only a few companies willing to go that extra mile for their customer. Be one of those companies and you will be the most VALUABLE.

willshome
02-04-2012, 12:58 AM
today, while going door to door, I saw the same issue every couple properties... BUTCHERED CREPE MRTYLES. It bothers me more than any other outdoor service done wrong.
As I was going through the neighborhood i contemplated bringing the issue up to the homeowners (basically I wanted to bash their current lawn service provider or whoever has done this)
i wanted to get the forums thoughts on how you all approach a potential client and critique their yard

I kid you not every other house had crepe myrtles that looked something like this.
When I offer better value to clients, I want to let them know that i know what i am doing, not just copying what other lawn service providers are doing. and if i come across a plant, shrub, tree im not sure about; i will not touch it untill i research it and learn expert opinions about it

I would look up how to do it right and print it out for the home owner and bring it to them, showing them you know what you are talking about and tell them how you would fix it.

PlumCreek Gardens
02-04-2012, 08:01 PM
This gives me so much more to think about for the spring, I've got a lot to learn about this business!

Steve
02-06-2012, 12:46 PM
It is fascinating how as you learn more about your field, you can see problems the average person or home owner might not see. If you can bring the problem to their attention and then show them how you would fix the problem, that could help you win them over as a customer.