TTE: Pricing Framework (Email 4)

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Note: This is an archive of an email from the April 1-7, 2020 launch series of The Traffic Engine (Early Adopter Edition).

Happy Friday!

Previous emails in the series:

  1. Tue, (Mar 24, 2020) — TTE: American Airlines (Email 1)
  2. Wed, (Mar 25, 2020) — TTE: Where do I start? (Email 2)
  3. Thu, (Mar 26, 2020) — TTE: Structure + Tip (Email 3)

There is a meta-lesson in this email that is carried over through emails 2 and 3. I’m not going to explicitly spell it out. If you’ve been paying attention, you’ll know what it is right away.

Here’s Shawn…

SHAWN: Fri, March 27, 2020

Today’s email is about questions … including my favorite question (and my second favorite quote which is — you guessed it — about questions).

First, let’s start with some housekeeping.

We’ve been receiving some great questions by email, and those questions and answers are available here.

Also, thanks to everyone for the amazing comments — there’s a lot of great stuff in there — please check those out (and ask any questions we haven’t answered already). I’ve been replying several times a day.

I’m really excited about today’s email. I’m going to unpack a really powerful idea I’ve been wrestling with for a while.

Let’s start with my second-favorite quote.

“Always the beautiful answer who asks a more beautiful question.” — e.e. cummings

(That’s not a typo btw — he insisted on lower case for his initials and last name.)

We’re friends now so I’ll tell you something personal. I love (LOVE!) great questions. In fact, I collect them.

I have a six-page document of questions I’ve compiled over the years. I use them for thinking and writing prompts, often when I feel stuck writing Morning Pages.

If I have a superpower, it’s the ability to look at situations in a unique way and ask powerful questions that lead to better results. I’ve done this so long it’s embedded in my DNA.

A powerful question I’ve been thinking about a lot lately is “what am I optimizing for?”

Meaning, what results do I really want, and are my decisions moving me toward those results effectively?

Are there second or third-order consequences that are counterproductive to my stated goal?

These seem like simple questions, but when you start to look closely they’re profound. Let’s consider an example from a conversation André and I had yesterday.

We have been getting questions about pricing for this first live cohort of The Traffic Engine. There are several ways we could think about pricing.

We could use the perceived customer value lens — what do we think the value of the material being shared is to the customer from his/her perspective?

Or, we could look at value from my perspective as the content creator — what’s the value, to me, of my time and energy to create and deliver the program?

There’s also an ego lens — what do I, as the content creator, need the price to be if I have somehow connected my identity and sense of self-worth to the product?

There’s no formula to accurately answer any of these questions — value is inherently subjective.

However, if we take a step back and ask and answer the question “what are we optimizing for?”, we get very different answers.

André has built a durable business (and world-class reputation) optimizing for happy, long-term customers. Let’s look at the pricing question through that lens.

If we’re optimizing for happy, long-term customers we immediately eliminate some of the nonsense that’s all-too-common in our little corner of the world.

There’s no latest-and-greatest persuasion techniques, no false scarcity / urgency — nothing that could be legitimately perceived as disingenuous.

Instead, we would have to choose transparency (being open about our decision-making), authenticity (being honest about our decision-making) and respectful of the people we serve.

To do that, empathy — i.e., imagining ourselves as the customer and seeing the world from that perspective — becomes the guiding principle.

If we’re faithful to our desire to optimize for happy, long-term customers, that means we need to do things that are completely contrary to conventional wisdom.

For example — we need to discourage people from buying who aren’t a good fit right now…

Not pressure those people who are “on the fence.”

Derek Siver’s “hell yeah” or “no” is the decision-making framework André and I gravitate toward.

For us to feel good about saying no, and to remain committed to a value I hold dear (i.e., leaving situations better than I found them), I created the 10-day free paid traffic training.

For many people that’s the best choice right now.

That eliminates the binary yes/no choice that creates unnecessary buying pressure. There are lots of ways to participate, free and paid. And that’s by design.

Is it short-sighted to discourage people from becoming customers now when I can contribute something of value that can change their lives for the better?

Only if I’m optimizing for short-term results.

So, back to the question — when you’re looking at your business (or a personal decision), step back and ask “what am I optimizing for?”

If you don’t have a clear answer to that question, then make it a priority to think deeply about what you really want. This seems so obvious, but in my experience, it’s an easy step to miss.

When you have a clear answer to that question, then you can evaluate your decision-making and actions to better understand if you’re moving in the right direction.

I’ve started asking myself this question habitually (and frequently), and I’m impressed with the insights generated.

Enrollment for The Traffic Engine live cohort opens on April 1 (next Wednesday) and closes the following Tuesday (April 7) — which is my 49th birthday.

We’re under shelter-in-place orders in Vermont so this will be my virtual birthday celebration!

I have a surprise for you Monday … no hints (except that I’m more nervous / excited about this than anything I’ve shared so far).

Enjoy your weekend!

Powerful, right?

Shawn gave you a lens through which you can make better decisions, not just pricing, but across all parts of your business.

Many (many!) marketers choose to price on value, and there’s nothing inherently wrong with that.

But it can be a trap.

When the viewpoint of the decision-making is done from the perspective of the marketer (with an objective lens), you get price points that we all know only too well…

$4995 … $1997 … $1497 … $997.

(To be clear, I’m not judging marketers who choose to charge 1000s for their stuff.)

There’s also a subjective lens (I unpacked this idea in email 2), which requires deep empathy…

To be able to see and feel the world AS THE CUSTOMER WE SEEK TO SERVE is an art, not a science.

Through our “marketers lens,” Shawn and I *should* charge $5K (or certainly some number in the 1000s) for TTE because the value is there (it teaches an “engine” that can earn you a lot of money long-term).

I charge around $500 for all our products because it’s the best price for a customer…

From my subjective lens, it’s a perfect balance of “HELL YEAH!” for a customer (feels reachable and uncomfortable at the same time), and enough that I don’t feel robbed.

In terms of value, is ARM or SOI or TTE worth $495? F#ck no! It should be a lot more.

… until you look at the offer through the subjective lens of a happy customer. Someone who will buy over and over, across many years.

(Remember: I’m optimizing for happy, long-term customers.)

Example:

A long time customer who is considering TTE, emailed yesterday to ask how much TTE will be. I told him. He responded with:

“Gold :). Right in my pain/pleasure point – feels reachable.”

I’m only drawing this out to unpack the lesson (which you can use in your own business).

For this live cohort, we’ll be charging $375 for TTE.

It’s ridiculously low, but we’re okay with this.

It’s more important for us to serve a few hundred (happy customers), than a handful of people at a price 5 or 10 times higher (for the reasons Shawn outlined).

So yeah: $375 for the core TTE training.

There will be one upsell when you enroll.

The upsell is for people who serve clients. This will be $250 extra. But we suspect that only 10-20% will need this.

Monday we have a surprise for everyone. 💪

Have a good weekend, and keep safe!

Talk on Monday.

—André (and Shawn)

P.S.

There is a lesson arc (the “theme” of these emails) if you study all the emails together.

Lessons you can take away and use right now, lessons that have zero to do with traffic.

Easter eggs.

P.P.S.

All series emails can be found here.