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No BS Price Strategy

Welcome to my No BS Price Strategy summary!

This book was recommended 2x by the same friend in a short period of time. It was ok. I’m starting from a pretty basic level here so most anything will give me some value.

The first third 100% focused on either not discounting, being very careful about discounts, or pricing too cheaply/competing on price. Felt it was just repeating info.

There was an interesting concept about pricing based on the timing (ie when someone purchases). BP was willing to spend a lot more on top Google search placement just after the oil spill than before, nothing else changed. Parents spent more money on child #1 than Child #3.

Context matters for price: examples given: doctor room spiffed up to be more professional and doctor switched T-shirt to suit and doctors coat; high-price NYC escort service sold more with a mature British woman accent answering the phones than a younger voice. This was a precursor to the book Pre-Suasion.

Pre-determination matters, think of books, my book and this book offer a lot of value for $10, but it cannot be sold for the value offered because there’s no pre-determination. Someone can buy any book; same thing with selling of a penthouse (maybe in a Trump banded building) is never hard because there are buyers who have already pre-determined for themselves that they want that specific thing.

All Airbnb hosts know they can charge more, or not discount, with guests who have already determined that they want to rent their listing.

Can charge more if the product identifies more with someone (supplements for X type of racehorse).

While it is useful, it does seem to have been written around 2010. A lot has changed since then, namely cell phones. He talks a lot about surveillance of your physical store. Nowadays, lots are online, so to omit that with an update is lazy. And while back then it may have been cutting-edge to get cameras in the workplace, that is no longer the case.

Chapter 19 – When is abusive pricing smart? Just the name of this chapter. He gives an example of a new FDIC insurance implemented in the Obama years (ie another tax) that annoys the hell out of him, but then he says if you can do this, you should. No dude. You shouldn’t. That tax is annoying and shouldn’t exist, just like the dozens of other taxes and registrations and forms, and various time demands, etc. that the government makes you do. Just because you can, doesn’t mean you should.

UPDATE: As I understand, consumers do not pay for FDIC insurance. Instead, it’s something the bank pays to the government to be FDIC-insured. I suppose banks could pass this along to consumers but my limited searching did not find this to be the case.

Offer links they mention various times throughout the book don’t work

Loc 527, a unique story about bidding on $100 bills taking the focus off price, and moving it to value.

Sequential Skimming pricing method, or skimming like with the new iPhone or treatments, those who want them first will pay the most. Once demand dips, so will the price to increase demand for the next lower lever of buyers. Chapter 17 – How Do You Set Your Prices?

The question is: how can I be nimble, agile, creative, modify my business, alter my marketing to get a boost from a recession? The best recession or tough times price strategy is creative and complex – not a red pen to mark down prices.

You read my book review and summary by Dan Kennedy and Jason Marrs. Be sure to check out my digital bookshelf for 100+ book summaries.

Some good quotes:

  • “Go to the ocean with a teaspoon or bucket; the ocean doesn’t care” (Loc 140)
  • The rich are paid for what they do in advance, before they do it. The poor are paid after their work. (Loc 2373)

Key learnings:

  • When you offer a discount, you are taking the focus from the value you provide and placing it squarely on your price.
  • It is so imperative that you always give a good reason for a discount and that your rules are solid.
  • If there’s a sale, it has got to be for a specific reason with specific rules.
  • Tell me, what do I need to know to do business with you? What do I need to know to feel confident about deciding to place my trust in you? How will I know I’m right for you and you are right for me?
  • The more demand you create the more scarce your offering will become in relation to demand and the higher your prices can go as a result.
  • Every “free” has concealed costs, and when those costs are revealed to a market, there are many customers who are unwilling to incur the costs of free and who profoundly prefer paying for the goods or services they want.
  • Once you start to compete on price, you can count on somebody coming along who’ll beat your prices, even if doing so ultimately bankrupts them.
  • Shift the commissions or bonuses you pay from gross to net.

New Words/Definitions:

  • Dolt – a stupid person
  • Foibles – a minor weakness or eccentricity in someone’s character
  • Paucity – the presence of something only in small or insufficient quantities or amounts
  • Feckless – (of a person) lacking in efficiency or vitality (I thought this was a typo and it was supposed to be reckless, beautiful use of this word)

Did you know I’m an author? I wrote four books on real estate investing, travel, and language learning.

Thanks for visiting and thanks to Dan Kennedy and Jason Marrs for writing No BS Price Strategy!

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