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Sell High-Ticket Products & Services

How to Sell High Ticket Products & Services DanLok

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Networking Tips from Dan Lok

  • Don’t try and sell people on your business right away.
  • Learn about their needs, goals and problems.
  • Deliver value first. See if you can help them in some way.
  • Plant seeds and nurture relationship.
  • Develop friendships with people you meet at the networking events.

How to Sell High-Ticket Products & Services By Dan “The Man” Lok

Want to Add An Extra Million Dollars To Your Bottom line This Year? It’s Easy! 

If you want to pile up an extra million dollars this year in your business — there’s a couple ways of doing it.

Frankly, most people are banging their heads against the wall trying to sell $7, $25, $50 or even $100 products.

You’ll notice it takes tens of thousands of customers to hit the 7-figure mark.

And notice I said customers — that doesn’t even begin to count the number of visitors you’ll need to generate in order to gain those customers. Even if you had a very high 5% conversion rate you’d still be looking at having to drive in 800,000 visitors! (Most sites convert at 1% — 3% so the number of visitors you need is significantly higher than what I just told you.)

But when you understand how to sell high-priced products and services you only need 100 good customers to pocket a cool mil.

Now you’re probably thinking, “Easy for you to say! But there’s no way my customers would buy anything priced like that!” 

I’m glad that’s on your mind because that’s exactly what your competitors are saying too – while you can be chalking up huge 6 and 7-figure paydays….if you get it!

Listen, it truly takes about the same effort (with a few tweaks) to sell a high-priced product as it does to sell a low-priced (low margin) product.

In most cases the difference is simply having the confidence to present an attractive offer with exceptional value to your customers at a premium price.

7 Reasons to Sell High-Priced Products & Services

Reason #1: More Profits – Less Hassle

  • Bigger Profit Margins
  • Very few companies have been able to profitably sustain a “lowest price” positioning (Sears, Kmart, Wal-mart?)
  • Price is not a sustainable competitive advantage
  • Someone will always find a way to undercut you
  • Many businesses acquire customers at a loss to grab market share
  • Most people don’t know how to sell high ticket products and services.

LOKISM

“Business is game of margins, not volume.”

Meat Business from TV show “The Profit”

  • $50 Million Dollar in Sales
  • $400,000 in losses
  • $4 million dollars in Debt
  • ($30K CASH in bank account)

Picture5

To Make $1,000,000:

  • $25 product x 40,000 customers = $1,000,000
  • $50 product x 20,000 customers = $1,000,000
  • $100 product x 10,000 customers = $1,000,000
  • $1,000 product x 1,000 customers = $1,000,000
  • $10,000 product x 100 customers = $1,000,000

Reason #2: Better Customers

Less Customer Support

  • $10 buyers = Many customers
  • $1,000 buyers  = Less customers
  • Dan Lok’s preference is to keep his businesses lean mean and simple
  • It cost money to get 10,000 customers
  • Work on getting less customers at higher profits margins
  • Cheap customer bitch more

Value Your Own Expertise

  • The difference between $100 seminars and $ 10,000 seminars

Reason #3: Psychology of Price

If you paid $10,000 for this information would you pay more attention. Would you make sure you applied everything you could?

“You get what you pay for”

  • Cost more must be good better
  • An Audi R8 is not $25,000
  • Price is a shortcut to buying decisions…
  • Early 2012, researchers at Stanford University and the California Institute of Technology took a bunch of volunteers and ask them to take part in a wine tasting.
  • Five wine to sample, all labeled with the price of the bottle they were taken from: $5, $10, $35, $45, and $90

Psychology of Price

What’s the catch? There were 3 wines so there was some crossover.

  • The volunteers preferred the $90 wine and describe the “oaky richness with undertones of burnt chocolate” of the $90 wine. (Actually it’s the 10 wine)
  • Interestingly, when a second set of volunteers were given the same wines with no prices, they preferred the $5 wine.
  • Here’s where things get scary – the volunteers in the first experiment (the ones who were shown prices) had their brains scanned with a MRI scanner while they tried the wines.
  • The part of the brain associated with pleasure was actually more active, the more expensive they thought the wine was.
  • The price label didn’t just fool them on a conscious, logical level (it’s more expensive so it must be better”), it fooled their brain at an unconscious chemical level. They actually did enjoy the wine more when they thought it was more expensive and less when they thought it was cheaper.”
  • Price fooled the brain on a subconscious level. The higher the price the more they enjoy it.

LOKISM:
“People enjoy paying for the things they value. And it seems the more they pay, the more they enjoy it.”

So why would you want to rob your clients of the simple pleasure of paying a premium rate for your products or services?

Reason #4: You can Deliver More Value

If you offered your service at a higher price.

  • How would this affect how you ran your business?
  • Imagine not having to work with cheap customers?
  • Some customers will leave
  • But you will attract more higher quality customers instead

Adding Value Mindset:

  • With a bigger margin you can deliver more value
  • Add 10 – 20x more in value
  • Create extraordinary experiences for buyers

EXAMPLE: Tony Robbins life and wealth mastery program

  • Resort Experience

Picture8

Reason #5: Some Buyers Only Buy Premium Products

There is a section of the market place the only buys premium products and services.

Nordstrom Buyers vs. Walmart Buyers

  • Some people want to immediately jump to the top of the heap and unless you have something for them – they won’t buy!

Picture9

Reason #6: Create BIG Pay Days

Nearly every “big product launches” you might have heard about was from selling a high-priced product to a few people (250, 500 or 1000 units)

“Customer-Funded Business Model”.

  • Get customers to prepay
  • Collect money upfront and then make product

Reason#7: You OWN the Marketplace

Affiliate payout – It’s a Competitive marketplace for top affiliate’s attention. Who’s going to get it? You can pay promoters more money to get the best.

Advertising/Marketing spending – Whoever can spend the most to acquire a customer wins. Period. For every $1 you spend you get 1.20 back

If you can do this you can always outspend your competition

  • For every $1 you spend you get 1.20+ back
  • Make the math work so you can outspend your competition

Hire the best people

  • Pay better so you get more productive, loyal employees.
  • To get the best people pay more than the minimum

Price Related to Self Image

  • People are too slow to raise price.
  • It’s more about confidence and self-image than the actual value delivered
  • Competition does NOT set your price – you give yourself permission.

How much would you pay for a small bottle of mineral water?Picture10

Workshop Exercise:

What is your high-priced example? And why does it work?

4 Types of Customers

Are there customers in your business that you rather not work with?

  • How would you feel if you got rid of them?
  • You can do more for your business if you just let them go.
  • Sell to right side and avoid the left
Cheap Buyers

  • Buy based on price
  • Demanding
  • Not appreciative
  • It’s in their nature
  • Asks how much its costs right away like it’s the most important factor
Sophisticated Buyers

  • Has the money
  • May need time to make a buying decision
  • Asks a lot of questions
  • Highly educated
  • Knows what they are buying
  • Knows what they want
  • Knows exactly what they want
  • Asks Intelligent questions
  • How much warranty is included?
  • Does a lot of research
  • Be the source of that education to build trust
  • Knows its an Investment
Difficult customers

  • Not cheap but demanding and difficult
  • Illogical questions and expectations
  • Negative energy
  • No smile
  • Always in a bad mood
Affluent buyers

  • Buys based on feelings
  • Does this feel good
  • They want the best
  • Doesn’t want a deal.
  • Don’t educate them too much
  • It’s not how they make decisions
  • No need for buy in offers
  • love exclusivity

We sell to who we are comfortable with

  • High net worth individuals are very guarded
  • Very few know how to get through the gatekeepers
  • Most people don’t know how to communicate with rich customers because they project what they value on them and fail to listen to their needs
  • They have a scarcity mindset

Your competition doesn’t set your price you do.

  • Do something unique that adds value instead of lowering your price.
  • How you do your marketing/sales and communicate your value
  • Being afraid to raise your price is a marketing issue. If your pipeline is full you don’t care if you scare away a few customers.

 

Watch this TV Show “The Profit”

Reasons to Sell High-Priced Products & Services

Marcus Lemonis’s Top 10 Rules For Success

1. Make a business plan
2. Have enough working capital
3. Create a to-do list for tomorrow
4. Take care of your employees
5. Have the knowledge
6. Constantly reinvent yourself
7. Always stay one step ahead
8. Stick to the grind
9. Push through the fear of failure
10. Stand out

The 5 Biggest Mistakes Entrepreneurs Make When they try to Sell High-Ticket Products & Services 

Mistake #1 – Selling a premium offer at a low price.

  • People are skeptical: “It sounds too good to be true.”

Picture35

Mistake #2 – Selling a low-value offer to a premium crowd

Picture34

Mistake #3 – Making a premium offer in a low-value setting

  • The environment isn’t right
  • Don’t make a $10,000 deal at Starbucks
  • Go to a golf or private club
  • There is a reason why I have my meetup at the Vancouver club
  • Perception intentionally created
  • Dress for success business
  • Think about what kind of environment you need to create

Picture32

Mistake #4 – Making a premium offer to a low-value crowd

  • There is no $1000 items in the dollar store
  • This is a low-value crowd
  • These customers don’t have any money.  You are selling to wrong people.

Picture31

Mistake $5 – Making a premium offer with a low-value mindset

  • Don’t project your values on them with a scarcity mindset

How do you change that mindset?

  • Immerse yourself in luxury environments
  • Hang around people that are way more successful than you
  • Sit in Pan Pacific Hotel
  • Go to fancy stores
  • Practice quoting a high price. Practice asking for a lot of money.
  • Expand your comfort zone
  • If you are not confident your body language will give it away

Read the Rock Report  Magazine

  • Look where they Sell High-Ticket Products & Services, there will be NO buy one get one free. Notice the language they use.

Making a premium offer with a low-value mindset

Ultimately, the secret to making a great income from your business is simple: Stop Selling to Poor People!

If you are not getting a little resistance you charge too little.

“Do I have to lower my price to stay competitive?”

  • Price-cutting is a self-inflicted wound. Your competitors do not lower your prices, your clients do not lower them. You DO!

“We can make it up in volume.”

  • Volume doesn’t matter as much as net profit.

LOKISM “All price resistance is in the mind of the business owner, not the client.”

Reflect back on a time when you cut your prices to be competitive.

  • “What happened? What was the experience like? Did the client appreciate the discount, or did they feel they “got what they paid for.” Did you enjoy the work?

Now think of a time when you may have charged a higher premium than you were used to.

  • What was the experience like?

How to Set Prices?

  • Value (People pay for their value, not yours)
  • The greater amount of pain the customer has the more money you can charge
  • Is it a nice to have or a must have
  • ROI (Money at a discount)
  • Contrast Pricing

LOKISM: If you’re charging market rates, you’re letting your competitors set your rates for you.

Other Factors that Affect Pricing

  • Payment terms
  • Guarantee vs No guarantee
  • No questions asked vs conditional
  • * Pay after “x” result

LOKISM “People afford what they want to afford. Stop discounting prices and start adding value.”

People want the fish cooked and delivered on silver platter

  • Didn’t need to lift a finger $$$
  • Do it with them $$
  • Do it yourself $

People afford what they want to afford

  • Stop discounting just add value to your offer instead
  • But sometimes discounting can be ok if it’s strategic

Workshop Exercise

  • Think about what you can do to absolutely amaze your customers
  • “How can I provide 5x – 10x in value for any customer of my high priced product or service?”
  • “What can I do that will absolutely amaze them?”
  • How can I give them the end-result they want on a silver platter?
  • How can I do it for them?
  • How can you do everything for them? People are lazy.

Dan Lok’s Mentor Dan Pena

Dan Pena’s Top 10 Rules For Success

  1. Practice success before you are successful
  2. Follow what you’re passionate about
  3. Surround yourself with great people
  4. Perfection equals paralysis
  5. Focus on the few, not the many
  6. Believe passionately
  7. What gets measured gets accomplished
  8. Just fucking do it
  9. Be extremely positive
  10. Love yourself

 7 Psychological Triggers to Sell High-Priced Products and Services

Psychological Trigger #1 – Scarcity

  • We are motivated more by fear of loss than of prospect of gain
  • Watch “The Diamond Empire”
  • Diamonds are not rare but we believe them to be
  • They turned it into a symbol for love and infused that into our culture
  • Then restrict supply
  • Created social pressure
  • Lots of advertising
  • A Diamond without this is worth $4
  • Huge margin. Evil but brilliant.
  • They turned something nobody wants into something you have to have.

How can you create scarcity in your business?

  • If you have a service business you can only work on so many clients
  • Restrict supply and pump up demand
  • New Prospect “Can’t do it this week because we’re fully booked”
  • Let’s schedule next week.

 7 Psychological Triggers to Sell High-Priced Products and Services

Psychological Trigger #2 – Rarity / Collection item

  • Exotic Cars
  • Watches
  • Pens
  • Liquor
  • Fashion
Psychological Trigger #2 - Rarity / Collection item - Comparative-Pricing

EXAMPLE: Comparative Pricing. Makes the first one look like a great deal.

 

Psychological Trigger #3 – Exclusivity

  • Rolex
  • Patek Philippe ($20,000 – $2 million)

Psychological Trigger Exclusivity

Psychological Trigger #4 – Ego Appeal

  • Black Card
  • By application only
  • The more expensive make them wait
  • Privilege – Not for everyone

Psychological Trigger #4 - Ego Appeal

Picture22

Psychological Trigger #5 – Part of Group

  • People want to belong to something.
  • Appealing only to NICHE

young-presidents-organization

Psychological Trigger #6 – Experience

  • “Once in  a lifetime experience”
  • People will pay to be entertained.
  • People will pay for an exclusive experience.
  • People will pay for a premium experience.

LOKISM “Don’t sell services, sell experience.”

Psychological Trigger #6 Experience

Brainstorm some ways you can “wow” your clients.

  • What are some things you can do so that your client feels that he or she got more than what was expected.
  • How can I increase the level of perception?
  • How can I increase the level of service?
  • How can I increase the level of experience?
  • Appeal to all senses. Be creative.
  • If you’re going to Sell High-Ticket Products & Services you have to wow your customers.

wow your clients.

Psychological Trigger #7 – Takeaway Selling

  • “People don’t want something until they know they can’t have it or other people want it as well.”
  • Qualification process
  • Application
  • Put them on a waiting list

Workshop Exercise:

  • How can you add ONE or more high-price psychological triggers to your offer or business?

Use this knowledge to Influence with integrity, DO NOT use this to manipulate. It will backfire on you.

Tier Pricing Strategy

Regardless of your industry, service, or product, you can probably think of a way to give your customers options. Make the middle package the most optimal and appealing. The large one is a decoy.

Three tiers work best since the structure fits a familiar framework:

  • Basic, deluxe, and complete.
  • bronze, silver, gold
  • Small, medium, large
  • Good, better, best

LOKISM “The quality of your business is directly related to the quality of your clients.Low prices attract disloyal, unfaithful clients, clients you can’t build a business on.”

Three Tier Pricing Strategy

Picture26

 Recap

  • Don’t sell to poor people
  • Get comfortable raising prices
  • Sell High-Ticket Products & Services
  • Don’t discount but add more value instead
  • “wow” your clients and customers
  • Deliver more than what was expected
  • Provide an extraordinary experience
  • Scarcity Mindset VS Abundance Mindset
  • The more expensive the more they wait
  • Serve don’t sell. Influence with integrity
  • Create scarcity in your business
  • Psychology of Price: The more they pay the more they enjoy
  • Some buyers only buy premium products and services
  • Don’t make a premium offer to a low-value crowd
  • Your competition doesn’t set your price you do.
  • 4 Types of Customers: Cheap, difficult, affluent and sophisticated

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1 Comment

  1. January 28, 2017    

    Very good info. Lucky me I found your website by accident (stumbleupon).
    I have bookmarked it for later!

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