August 7, 2013
While down under, I had a drink in Brisbane a few nights ago. I was chatting with a guy who’ll go by “Australian Dude.”
He told me he generally prefers NOT to charge for any of the work he does.
“WHAT, but how are you going to pay for all the drinks?,” I shouted at him.
It dawned on me at that moment he is not alone and many people, including myself, struggle with this.
When Mint hired me, they paid me $100,000 for being the director of marketing. I thought to myself how STOOOOOPID these guys were for giving a 24 year old all of that money.
Then with AppSumo we put my time up as a deal where you could talk to me for $250 for an hour.
Sold out in a few hours. Fuck. Okay, double the price. $500
Sold out in another few hours. Fine. You guys wanna play tough. Let’s play hard!
$1,000 (Dr. Evil expression here)
WHAT THE F. Sold out in a few hours????
Why do these people want to talk to me?
And now I feel a lot of pressure to make sure these people get $1,000+++ worth of value just from talking with me.
Where does that guilty feeling come from? Why do we feel guilty charging for our time, services or products?
1. We don’t feel worthy of ourselves or realize the value of our skills in relation to other people. This is where you have a bad ass talent and just look at that skill as common sense. Others see it as very unique, special and something they’ll pay to learn or utilize.
2. We don’t feel qualified as an expert since we haven’t really done much to earn it.
Compare this to my brother who’s a doctor. He has NO QUALMS about charging a LOT for his time since he had to put in an additional 8 years of schooling.
3. We are concerned that money (specifically asking for it) will change the relationship with the other person.
So what the frick can you do to get out of that way of thinking.
Here are 5 simple ways to overcome feeling guilty charging for your time:
1- Understand the amount of MONEY you are helping make for the person.
For the work you are doing, look at how much revenue that new stuff will actually be created. If it doesn’t happen instantly then look it at over a 1 year time-frame.
You buy the $300 How to Make Your First Dollar Course today. Yay, #sale-madeYou start a business. Makes $100 / month over a year. That’s $1,200.
So you pay $300 and get $1,200. Sign me up for that shit!
Real point to re-iterate is recognizing that you are only charging a percentage of what the other person is gaining from your time.
Try to charge 1/10th of whatever money you WANT the person to be making. I expect people to create businesses for life. Asking for $300 is a small percentage for that person to have the lifestyle and profitable business they want. It is a fricking steal.
2- RECOGNIZE YOU CAN NEVER GET THAT TIME BACK.
Why do I charge so much for consulting (which I never do)? Read what I wrote in parenthesis. I don’t want to do it SO I charge a lot so people won’t want to hire me.
3- People VALUE what they pay for
A while ago I gave a good friend some Free AppSumo products expecting him to use it. 3 weeks later I hit him up to see what he learned and implemented in his business.
Money is a truth-teller. It’s a trade of your time for things you value.
If a person really values what you are doing for them then you should charge them otherwise they’ll value you less.
For yourself, think about an ebook you got for free vs a book you paid for. Which did you read first? Which did you find more valuable?
Bonus: When I’ve paid a lot of money for things ($3,000 weekend seminar with David Deida) I value it a lot more and focus harder on making sure I get MY money’s worth.
4- Give it away for free.
Don’t feel guilty and just keep doing that. See how well not feeling guilty pays the bills. But seriously keep doing it until you don’t have time from your over-abundance of clients and then start charging something.
This is a helpful way to build up your confidence and validation that what you are providing people want so you can progress to start charging people.
5- START SUPER small.
With AppSumo I used to just do a price mark-up of 10% until my good friends Andrew / Ramit both kept saying to charge more and stop being a bitch. As an EXPERIMENT I tried marking up 100%. Guess what??
a) same conversion rate on sales
b) higher positive reviews of the product
c) less refunds
If you are unsure, just start small and experiment.
As it happened at Mint, my marketing helped them eventually sell for $170,000,000 so was that worth the $100,000 they paid?* 🙂
*Not saying I’m the only reason they sold for that much at all. Instead it puts a $100k salary in perspective next to a great ROI for Mint.