Running two differently priced memberships at the same time, can be challenging.
In this episode, we are discussing how to set the right price points, how to avoid devaluing your services and how to make sure that all your clients are satisfied.
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3 Big Take Aways
- How to set the right price point
- How to make sure that your clients feel they are getting their money’s worth
- How to avoid devaluing your brand or your service
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Tazeem: So one of the things I've decided, and I've talked about this since beginning when I started working with you guys, but I have decided to launch my lower price membership based on what's going on in the world.Even though I started to really want to work with people high level, I feel like right now that's just not an option.
Businesses are closing their doors, I've had to scale back. So I'm really trying to be mindful of just where the world is at.
Tazeem: Something else that's driving. This for me has been unbelievable. I was actually invited to be an influencer with the largest organization of estheticians in the United States,which is like amazing mindboggling and I'm blown away, but that's really been driving a lot of what I'm doing now.
So my question to you is one of the things I want to do for my current members that are paying 99 or 79 that are in my original, it's called inspiration mastermind. Those that are in that group, I want to gift them the $35 low level price point membership for free for a year,maybe longer, as long as they stay paying what they're and they'll continue to get what they're getting right now.
My question is am I shooting myself in the foot by doing that? Do you have any, I guess, any insights or any tips on what I can do to perhaps like I was thinking about going back to some of the people that were in my original membership and saying to them, I'd like to offer you the original founding members price if you'd like to join us again.
And as a bonus, you're going to get this new membership for free, but it's all the dollars, right? So even if they paid $79 and then they're getting another $35 value,that's a lot. But like you said, trying to keep building on a little is better than nothing. And it's not about the negative mindset.
It's just about where the world is at right now and wanting to continue to hopefully get some great testimonials from the people that are in it, because that's why I figured it would be a great way to put some of those people into that group.And there's not a lot, I've got like six people that are currently in that membership.
So it's not a lot of people don't have to gift for free . However I want to be able to go back to some of the people that were in the membership originally, any insights on that really? I guess in a nutshell.
Paul: So anybody have any input?
Suzanne: I'm nervous about free for that long a period of time.
Tazeem: Well, my fear is that they will jump out of the bigger, the smaller group. That's higher price to go to the smaller one, and then I'm going to lose them altogether because the new membership is only $35 for founding members. But my current clients are paying between 79 and 99.
Okay. That's the only reason. And that was my fear.But when I talked to my husband, who's my logical side. He's like, but Tazeem at the end of the day really does it, does it really matter? Right. So I don't know. I'm just, I'm really curious as to what your thoughts are, Paula and Melissa, if anybody else has experienced anything like this.
And I feel like I'm going to stop promoting and offering my $99 membership to the world.The only place that will be available is through this organization. So they have to be a member of that organization if they want to join me there. So I'm going to start promoting it. I'm only going to be focusing on my $35 founding members membership.
Paul: Anybody have any input?
Jason: Can I just clarify, is it six people at 99 at the moment?
Tazeem: Well, it's actually three at 79 and two or three at 99.
Jason: Can I ask a follow up question please? Sorry.
Tazeem: I know you're you're the finance guy, so yeah, totally helpful.
Jason: So on that basis, if you think about having six people at that high tens, how many more people do you think you'd pull in at 35?
Tazeem: My goal would be to have at least a hundred people in that initial launch.
Jason: So it'll actually be less than this cause I did it on 99, but you only need 17 people at 35 to break even on where you are now. So it just becomes a volume play. It's just a different thing. So personally for me,I think that what I, what I've seen in the last four months, people making commercial decisions for all sorts of different reasons.
according to their own circumstances. There is very little, right. There is very little wrong. It's what fits for people right now. And it doesn't mean you're stuck with these things forever and a day thereafter as well. You can always change in the future and adapt as you wish.
So I would say at six people at 99, if you're going to go full on and put all the energy into 35, you only need 15 to 17 people probably to break even on where you are now, you've got six times the number of people you've just posted as your ideal thing, where you get them all in one go or not, who knows,but you're probably not going to be any worse off would be my guess
Tazeem: Interesting perspective. Okay. Thank you. I appreciate that.
Paul: Anybody else have any input? Any thoughts?
Suzanne: And the true wisdom is revealed.
Paul: It's always difficult. If you're going to this same exact market and you're bringing in two different price points into your brand at the exact time.So if you're shutting off the one and that's not a front end offer, you just really need to educate your current people the difference between what they are getting and receiving from you and the value.
And also how like undervalued it is that they are getting like what, as far as like how much they're getting from you for, for what they're investing.So that there's contrast. So if, and when you do put this other offer into the market, it doesn't make all them go, well, crap. Why am I paying this much money?
I'll just come over and pay this. Or it's just a good time. Now that I'm thinking about this, I'll just quit, you know, cancel all together.Cause now you're introducing a new decision. So you just gotta be careful.
It's just in any market. It just, it's always, it's always hard to straddle. It's like near and pot. It's not impossible, but it's near impossible to straddle two different price points.In the same market .Years ago, I had a guest hall calmer at an age two in the moment that they brought out the H three.
Nobody wanted it either of them. Right. You know, because it devalued the brand because it was like all of a sudden the $70,000 thing you can get for 25 to $30,000. So it's like, well, why do I want the brand at all?Right. You know what I mean? So I just thought that you had, you know, you just had to be careful because how you're placing yourself in the market and perceived, is that a certain level?
Now, if it was me and I knew I was going to do this, and if you're just definitely making the decision, either way, I would like make,I would rename the current thing, like my inner circle, you know, like this is like, I need needed to feel exclusive. The people that are paying the 99 at this point, they need to feel like they're getting me.
And the other thing isn't really getting me. It's getting content, but it's not getting the coach.
Tazeem: Well, that's a big part of it.Right. And that's one of the biggest reasons is that I'm going to be giving a lot more prerecorded stuff. And very, very little of me compared to right now, like right now I do two zoom calls with them every month.
And there are minimum two hours at a time plus all the prep work. So that's a lot of my time that they're getting right. And so that's definitely one of the things I want to do is step back. So I know it's going to be like, somebody else had said, I need to hire a VA to get them, to help me do the backend stuff, create an upload, a lot of content.
But I don't want to give that much of me.So they'll get one zoom call, whether that's 25 or a hundred people that come on we'll still only do one zoom call.
Paul: Yeah. Cause you Don't, whatever the new, you just need to make sure that the perceived value cause you're anchoring price points. Right. And if people feel, you know, even a tinge, like, hold on,why am I paying this?
Paul: That's what we have to think through in advance. Now we could also do is if, if you have a tight enough core part of your group is you can bring them in and make them feel like they're part of building this new thing with you. Right. So then give them a perceive ownership experience since it's a smaller group.Yeah.
That way they can all in a way kind of get their feedback when like, Ugh, if I do offer this one thing, they're all gonna leave. You know? Cause they, they basically gave you it'd be like doing a focus group.
Tazeem: Right. And that's what I said to them. Right. I said, you know, you guys will be a part of it because I really want your feedback.I want to know what you guys feel like suggestions for things that I can build into the backend of the program.
Right. Or the membership.
Paul: The only challenge that I have going forward for you is just, if it's a completely different offer and it's packaged differently as different branding and everything, and you're putting it into the market. And since you're not going to be talking about the other thing as much,and you're going to bring in people into this one space, at least you're not going to have clouding of message back and forth.
Cause that's hard to like be selling two things at the exact same time. Because it's like, I don't get like, what's the difference between these two things? What I would say though, is going in to the market with this new thing is going to be named completely different? Cause you're basically starting at zero building back up, you know,
Tazeem: The current one is called inspiration mastermind and the second, the new one is going to be called spawn marketing lab.
Paul: Okay. Actually I'm okay with it being mastermind. It doesn't necessarily have to be inner circle there's a perceived value and you're giving more access right now,just coming in on this front end offer though. It's just, you just want to, again, this is just being careful because if these people are that strapped financially that they can't afford a 99, the third, like we're talking business choices, not like again, like Netflix at home.
Right. So like then how is it that much incredibly different of a,a financial decision at a 39? Like if they're that strapped that they would say yes or no. I mean, definitely price anchoring. It's it's a different pricing decision. Cause it's under 50 versus a hundred, but it's still, it's just like, they're that on edge with their business anyway, they're probably gonna say no to either of them. Cause if you can sell them into the 39, I believe you can sell them into the 99.
Melissa: For sure.
Tazeem: So you're thinking it's not a good idea that I offer it at 30 bucks?
Paul: I'm thinking that if have you put your current near $99 offer into the current market to see how people would react to it.Of course you're going to get COVID type of were shut down, you know, those types of things, but you don't need 7 billion people in the world.
So you just need the people that are going to say yes.
Paul: So it's like, there are people right now that are looking at this as an opportunity moment because they have less competitors. So while everybody else is retreating,they're saying, how do I step forward? And it's looking for those people that want to step forward and take a risk right now.
I mean, some of your that are in here they had their best launch ever right in the peak of everybody losing their jobs. I mean, let's think about this. So it's like,so we can allow the narrative to be that yes, there's people that are definitely jammed up and that's not an objection.
It's a condition it's like, they truly have no money to put on the table or food or whatever. Like there, all of us are going through different realities . At the same timethere are people right now that are saying, you know what?I don't have my spa right now that I was losing money on every month.
Anyway, instead of that 3000 square foot place, I'm now looking at a thousand square foot place. So I'm now saving thousands of dollars a month. Hmm. Where should I reallocate that money? Oh, instead of having the five staff people that I was losing money one,two months ago and I was afraid of firing anybody.
Now I'm able to use what's going on in the world to get rid of everybody and start reboot my business. That I had three locations and two of them were failing. Now I can just consolidate down to the one, where should I put this extra money I'm going to get?And also there's people that are saying
"Crap. I just took an early buy out from my corporate job. I think I'm going to go into the spa business. Now suddenly put some money into looking into the market to see how I can be successful spa owners."
Heather: I was just going to say kind of along the lines of what Paul and Melissa are saying, here's the thing. If I'm a business owner and I'm serious about building my business, regardless of what my situation is, I'm going to be suspicious of a tool that's alleged to be really valuable.If it's only $35 a month, that's a personal improvement price point, right?
Because you're not talking about, I say this when I have a $47 price point for my scrappy, my People are like scrappy Christian solo preneurs, who don't know where to start. That's not your target audience. Right? Your target audience is people who already have a spa business.Correct?
Heather: I, I think you're totally shooting yourself in the foot to do it at $35.
Danielle: Can I say something as well? Sorry. I'm making dinner well at the sink. All of us to share,
Paul: you have to share.
Danielle: So my price point's different. I, my market is Mara lawns, not business,but I was going to launch again at $25, $27, which is every time I go up, but during COVID, I was like, this is terrible.
I need to keep my price down. And my coach , he pushed me to increase the price to where I know the value is. And so I was doing four coaching calls a month,four hours, the same deal we get to $37. And I had the best launch I've ever had. Now it's only a $10 increase, but it just goes to show. I think that people, especially right now, people are coming through, they're seeing the light, like if they want their businesses survive, they've got to make changes.
I've just invested in a number of people for my business,spend it more than I ever have on my business. So I think that, I don't think you need a lower price.
Tazeem: Well you said is everybody suggesting I go higher than 35? That's what I'm hearing. Okay. So am I keeping it under that $50 mark? Because then what reason would my current clients have to stay in the one that they're in?
So my question
Paul: is, is do you need the second product?
Tazeem: I feel like I've lost steam with this current membership and the way that the model is. So I don't know if I just need to reignite it. Cause I've been doing my own membership for almost 18 months.
So I don't, I don't know why. I just feel like I lost a lot of members and a lot of them have said that because of COVID they just had to stop. So, you know, they, most of those guys were paying in 79 and 99. I've got it at 125 right now.And I know we talked about that, that if you're doing 125, you might as well do 199 or whatever.
Right. So I don't know. I'm just really not sure I'm listening to my market. I've, I've given so much, I've been in service, I gifted. I've done a lot of that, but I just feel like I either need to ramp up and go based on volume so that I can have,you know, an income that I want every month or I need to somehow do something different with my current membership because I'm not getting the bites on it.
Arlene: I always say, do what your gut tells you to do. Because I'm, I'm wishy washy on some of that stuff too, where I think,okay, but am I worth that monthly? You know? And then I feel so bad because then this person really can't afford it, but I want to help them.
And then I have different clients on different price points, which I know is totally wrong. And I shouldn't do, I should have my one package, but I'm flexible with each of my clients.So I would suggest, and I think your gut is telling you to go lower, that you that's, what's going to be comfortable for you to do.
If you do package it, make it temporary, not longterm. So I think at first you said it was for a year. I went to just maybe just doing a softer,smaller launch or if you want to go big, that's fine. But keeping it so that because in six months, things may turn around that they may be able to afford that regular price, or you're going to jump them up and say, I'll start you off at 35 and then we're going to go to 65.
And you know,and then maybe at different points allow them to then jump to the top level if they want these additional features and let them know that that's there. But if your gut is really telling you to keep it up at price because of, of how the world is right now, then do it. But I wouldn't do it longterm, make it just a special thing that's happening for right now.
Tazeem: So what I was going to do was to offer it as a founding members pricing, for I don't know, couple of months or maybe a month or so, but I was going to give to the current clients that I have, that they would get a membership for the new membership for free for a year.
So that year it wasn't that they would that the prices for a year.Okay. It's only available to those that are in it. That's what I want to go back to the people that are fallen off and say, listen, I'm doing this. If you join again at your original pricing, then I will give to you the new membership for free, but for the year.
Arlene: Okay. So there's a difference in the product that you're offering at the two levels.It's not just a smaller version. It's totally different product.
Tazeem: Not quite there will be some similarities for sure, but other pieces that I want to bring in where I will have to do some front end work. But after that, it'll just be so much less stress for me right now, It's a lot of work.
And there's a lot of energy,right? When you're dealing with people almost one-on-one in this capacity, it's very, very different.
Arlene: Yes, it is.
Tazeem: Right. It's a lot of energy and I'm exhausted. I'm so tired giving, giving, giving. Then I figured, yes, I'm going to be exhausted for the first six months pulling this together.
And hopefully after that,and I got all the pieces together, then it's only creating content per month
Arlene: I would think an end goal, especially if you're doing this on your own to have that membership where they're going in to get content that's there are you recording and keeping your recordings of what you do with your clients now.
Arlene: Okay. And you're keeping that as part,as a library for them
Tazeem: possibly. But the thing is the problem with that is that there's a lot of personal things that we talk about. Like, because I don't know if I want to, I'd have to ask their permission right. To, to use that. So I don't know any other final thoughts.
I know where I've taken up a lot of time.I didn't even think I had a question today.
Paul: I just think it's definitely something you need to navigate. Like all of us are giving our own outside perspectives. And the more that you talk about it, you have other deeper reasons of why you want to do this. And that that's just something I think you really need to look at.
If your goal is to make things less heavy than maybe how you built your higher membership is very heavy and you're going to overlap those for a while. So now you're going to have more work because you're going to try to go to the new thing while serving the existing people. Right? So if your longterm goal is to unravel yourself from the high thing, after you replace your income or then some in the lower commitment thing, then maybe that'll allow you and give you the space to then revisit a new opportunity that is structured differently.That it doesn't take all your resource, your time and energy resource away, because that's just something that came out of you talking with Arlene's is that it felt like the, the higher, even though people were paying more, how you structured it is just really heavy.
So maybe that's why you're leaning into this, which is beyond money and price points and other things that we're talking about.It's like, you're, you're thinking in your mind, like, why do I want to put more energy into something that's like pulling my energy? You know, I don't want more people. Oh my gosh, I have no life.
Tazeem: I was like, Oh my God, I'm just not sure.I really need to sit down and figure this out. And I've been back and forth and it's been so difficult. But you know, as my husband said, once you've got the members in the content you're creating on a monthly basis, pretend you're creating it for one client and they're paying you however many members there are maybe it's, you know, 2000 or 3,500 bucks,but you've got one client who's paying you that much every month. Right?
Paul: Yeah. We shut down and we sunset it last year, a photography membership because it didn't serve us anymore. There was hundreds of members in there. It was very, very profitable. And it was just that, that was a space that I weaved in and out of my life to come full circle and what we do and Melissa was never a photographer. She was like, she doesn't want to talk about f-stops and apertures all day long.
Like, you know, so we were talking about marketing branding, positioning, which is what I've done my entire, my entire life. So it's just something that sometimes it's beyond the money element. Also it's a energy and emotional resource and it's like, something was serving us and the idea was really cool,but these slow micro-commitments that some of us make in the moment, in the moment, it sounds great.
But then when you stack all those little decisions up, all of a sudden you look back, you're like, what the heck did I create? Like, I didn't want this. I wanted something different. And sometimes we had to put the reset button on.
Tazeem: Well, I think because it's dwindled, I think that's, that's been really difficult to watch.
And I, again, like a few people have commented, I gifted a number of my clients, you know, a month or two for free, just pause their payments. But at the end of the day, I still have to feed my family too.So it's like can only pause for so long. Right. And then, so it does, it makes it difficult. It's kind of like you're between a rock and a hard place right now.
And it's yeah, I'm watching a lot of aestheticians really, really in a bad place. Right. So I'm like, okay, well this might be a great way to give them something where I'm just not hands on.But yeah. I think I'm just going to have to, I'm going to have to sit and meditate.
Melissa: Meditate, marinate. Yeah, absolutely.
Lisa: Can I just add something quick sometimes if you price something and you don't feel like it's a fair exchange back. So if you really put in a lot of effort in, and then you're charging a low price and like you said,you feel like you're given and given and given. And if that's not a fair exchange, you're not gonna really feel it really motivated to carry on doing it because it's draining you.
And I think maybe just try and see where you're more aligned. Like if you prefer to do less, that's okay. It's like, it's okay. You've got permission to do that as your membership and whatever works for you and let it,it fits easier to be simple and less of your time, you know, trading for money and you can do a lot more content automated and that you can build in that way, then that's brilliant, but it's okay to change your membership.
If it doesn't serve you, you don't have to stick with something. Because you started it. And also if you're charging too low for the, what looks like a really high value membership, then it's probably you feeling like every time you do it, it's like, I'm not really getting a fair exchange, not being paid enough, but I'm having to give and who wants to carry on doing that?
So just, you know, feel what feels right for you and what's aligned.And if it's the simpler membership, then like Paul said, just transition, keep them both open. And when that overtakes, then you can redo it, but you aren't allowed to change. It's your business. You can, you know, you have permission to do whatever.
So yeah, just have that anyway.
Tazeem: Thank you. I appreciate that. I'm always about not wanting to disappoint people or step on people's toes.And so it's just like, you know, if I made a commitment to something it's very hard for me to go back on. Cause that's just who I am. I'm always that person of integrity, but yeah, I do need to go back.
Thank you. I really appreciate it.
Melissa: That was great. And I think sometimes like we forget that.Yeah, it is our business and we can do, and You don't need permission. Like, it's just like you get this, you get to decide how you run your membership. So yeah. But I know, I know, like I think if you just sit marinate and kind of figure out what's important to you,you'll, you'll figure out a good solution just, and just keep us posted too.
Tazeem: So thank you so much. I'm always very grateful. Thank you everybody for your input. Awesome. Awesome.