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In episode #576, Eric and Neil explain how you can get away with charging more and still be successful. Tune in to hear what “niching down” is and why it can help your business.
TIME-STAMPED SHOW NOTES:
- [00:27] Today’s Topic: How You Can Steal Business Away From Your Competition – While Charging More Money
- [00:38] Niche down!
- [00:51] Make your business really specific (ex. a Facebook ad agency that specializes in working with educational companies).
- [01:08] You can charge more because you’re niching down and have specialized skills.
- [01:37] Campaign Monitor set out to be email marketing for designers. Niching down allowed them to make money and gain success, because they kept the job specific.
- [02:38] Drip just rebranded to be e-mail marketing for e-commerce.
- [03:07] Look at your “dream one hundred” and reach out to them and do a free analysis.
- [03:28] When you tailor your messaging to target a specific group, it will be easier for you to make things happen.
- [03:50] Apple started with a single computer and now have a whole line of products.
- [04:08] When you’re working in a niche, your conversion rates will go up.
- [05:15] You are able to charge more and make more, because there is less competition and you are offering a very specific service.
- [05:45] Eric’s company specializes in helping SaaS, e-commerce, and educational companies.
- [05:55] You can’t be everything to everyone!
- [06:01] That’s all for today!
- [06:05] Go to Singlegrain.com/Giveway for a special marketing tool giveaway!
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The post How You Can Steal Business Away From Your Competition — While Charging More Money | Ep. #576 appeared first on Marketing School Podcast.
Full Transcript of The Episode
Eric Sui: Welcome to another episode of Marketing School. I'm Eric Sui.
Neil Patel: And I'm Neil Patel.
Eric Sui: And today we are going to talk about how you can steal business away from your competition, while charging more money. I'll keep it very simple. Here's one simple way you can do it. It's niching down.
When you're starting out, I'll talk about this in the context of services, when you niche down, when you are a Facebook ads agency that specializes in working with education companies, for example, A, it's easier for you to sell. It's most focused, which means at the same time, when you talk to people, people are like, "Aren't there other Facebook ads agencies out there. Why do you guys charge more?" Let's say, 2X, 5X, your prices. You say, "We have a lot of experience in the education niche. This is who we work with. Here's all the companies we worked with. Here's what we'd do for you, exactly. Here's why our process is different. Here's why you'll get results faster." You can make that kind of argument when you niche down instead of trying to be everything to everyone. In that case, it's unfocused. People are confused. The more confused your messaging is, the more difficult it is to sell, and the less you get to charge, and the less you make.
Neil Patel: Another good example of this is Campaign Monitor. The email marketing space is crowded. When they first started out, they decided to focus on a niche, email marketing for designers. That allowed them to grow faster, generate millions in revenue, eventually be mainly bought out by private equity/venture capitalists, and then from there they kept growing and expanding.
ConvertKit recently did the similar thing in which they created an email marketing solution that was supposed to be easier than most tools out there, and they didn't do well. The products great, but they weren't getting any traction. The moment they started shifting focus and being email marketing for bloggers, and specifically bloggers, and they still have that going on, they grew all the way to roughly 10 million dollars a year in revenue and it only took them a few years.
Focus, and you can charge more, but the moment people know, "Oh, your product or your service is just specializing in this," not only will more people want to switch to you, but they're more likely to pay you more, as well.
Eric Sui: It's interesting because Neil brings up ConvertKit and one of their direct competitors, Drip, actually rebranded recently, too. They are not email marketing for eCommerce. So, you can see this happening in the marketing software space. Again, if you're in the services space, just look at all the people that are your Dream 100, this is your Dream 100 clients that you want to work with, and I highly recommend reading that book, The Ultimate Sales Machine. It will go into more detail around that. It's by Chet Holmes.
Look at your Dream 100. Let's go with the education example. Reach out to the people in education and say, "Are you happy with everything going on, right now?" Like Neil mentioned in the past, you can reach out, do a free analysis for them, hand it off to them. Talk to them for five, ten minutes or so, and talk about how you're different and how they're going to get better results. That resonates because, when you tailor to something in your messaging, let's say when you're reaching out cold email to someone and it's customized, even for one to two sentences, towards what they care about, towards what they know, towards what they relate with, it becomes a lot easier again for you to make things happen.
Make things less confusing. Then, if you're starting out, this also applies to business as well. When you look at Apple, it started with a computer first. Now they have the iPad, the iPhone, all these other bells and whistles. It's important to niche down first. That way it's easier to steal business away from your competition and you can charge more.
The reason you want to niche down is, you'll find that your conversion rates go up. When you're in a crowded marketplace and you pick a specific niche, you now know where to spend your marketing dollars, so you're not blowing it all over the place. Two, your conversion rates will go up, because when the ideal user comes to your site, they'll be like, "Your product or service is specific towards my needs. This is a better fit than other people's." The features are the same of your competition versus you, but having that niche messaging boosts your conversion rates. When people feel that you service specifically them and their needs, because everyone's looking for case studies being, "Hey, have you done anything within my industry?" When they know you specialize in their industry, they're much more likely to write a check and they'll be willing to pay more.
I had a friend, Ian, and he has [Billfire 00:04:58], which an iPhone app generating tool, and they templatize everything. He took his pricing and he increased it. He's like, "Oh wow. We just made more money. No one dropped off." When you specify what you do, and now he's focusing on enterprise app building, and that's all he focused on for Android and iPhones, he's able to charge more money, make more revenue, and he doesn't have to compete with all the people who are charging the S&B prices and going after that market. He's like, "Hey, look at all the large corporations we worked with." Yes, the products are the same, but because he specializes, people are like, "Hey, we're going to go with you because this is what you do and it's your bread and butter, and we're willing to pay you four or five, ten times more money."
Neil Patel: 100%. Just to build on top of that, it's the same thing with the marketing agency. When people ask us, "What do you specialize in?", the areas that we've been exceptional at are helping SAS companies and eCommerce companies, and also some education companies, too, but we stay in those three areas, and we only focus on the services that we're good at, instead of trying to be everything to everyone. If you're trying to be everything to everyone, you're not helping everyone.
Eric Sui: That's it for today's episode. Make sure you check out our daily giveaway at singlegrain.com/giveaway. We look forward to seeing you tomorrow.
announcer: This session of Marketing School has come to a close. Be sure to subscribe for more daily marketing strategies and tactics to help you find the success you're always dreamed of. Don't forget to rate and review so we can continue to bring you the best daily content possible. We'll see you in class tomorrow, right here on Marketing School.
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