30:3 Unpacking value based pricing
In this weeks episode we talk with Rob Da Costa who shares the concept of VALUE based pricing and answers standard objections Lee hears in the community about it.
Trading time for money may be our comfort zone as an agency owner but it is likely holding us back, trapping us in our business and not even doing your clients any favours either! In this weeks episode we talk with Rob Da Costa who shares the concept of VALUE based pricing and answers standard objections Lee hears in the community about it.
Rob Da Costa
Don’t charge by hours. Don’t charge that way because it’s just a commodity and people start comparing one person’s hourly rate or day rate to another’s and that’s just not the way to do it.
The values selling idea starts from when you first meet a prospect and the questions you ask them.
What the client cares about is outcomes and impact not how long something takes you.
Sometimes people are a bit scared of asking questions because they are not confident that they can deliver. If you don’t ask those big important questions at the beginning, there’s a really strong chance that you won’t delight the client and you won’t retain them for the long term.
When you broaden the question, it actually opens up a whole load of other opportunities for you.
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Lee Matthew Jackson: Welcome to another episode of the Agency Trailblazer podcast. This is your host Lee and on today’s show we have a man with a very cool name. It’s Rob Da Costa, how you doing bro?
Rod Da Costa: I’m doing good thanks. If only it were connected to Costa coffee, which often people ask me, I’d be very wealthy.
Lee Matthew Jackson: Yeah, and no relation. I mean you’ve kind of got the beard going on there and the obviously dyed grey hair as well, similar to the founder.
Rod Da Costa: I wish it were dyed.
Lee Matthew Jackson: Especially with Coca Cola they bought them out as well, didn’t they? I saw my first Costa coffee can of coffee the other day in the fridge. Not in my house because I wouldn’t buy cold coffee. It just sounds wrong. So for those of you who don’t know who Rob not Costa coffee Da Costa is, you can find out more information over on https://www.dacostacoaching.co.uk/ and as always, we will make sure that we put a link in the show notes. Rob, please, could you tell us a little bit about yourself?
Rod Da Costa: Sure. So that’s a D, Da Costa with the da, not a de, which so many people spell it that way. So, well for the past 13 years I have been working as a kind of coach; mentor, trainer. Working with, I worked out last year about over 250 agencies to help them grow their agencies in a profitable, sustainable way and have a life at the same time. And so yes and before that I ran my own marketing agency.
Lee Matthew Jackson: Well you’ve listened to the episodes before and I love to talk about our time machine so mate I would really love it if we go back in that time machine back when, you used to wear flares. I am really joking mate it but tell us about that original marketing agency. How did it get started? What was it all about? What was life like?
Rod Da Costa: Yeah, well first we’ve got to go back far enough to think about what the world looked like before we had the internet and even before email came along. So I started out my career in a marketing role in a software company. In my youthful arrogance, I ended up as marketing manager and felt that we couldn’t find a good PR agency that understood complex tech. So I thought, I know what I’ll go and start my own agency. So at the age of 23/24 I left there and started out on my own and started a company called CIT PR and grew that in the first year to turn into about 60,000 pounds. Then I had a business partner come and join me and his specialty was hardware, mine was software so we were a good fit and over the next 11 years we grew the agency into a full service marketing agency. So we started out as PR but as clients asked us to do more design work, we then brought some designers in house and ended up being more of a full service agency and grew the agency to 25 staff turning over about one and a half million pounds. PR week named as the fastest growing agency outside of London in about 2001 I think, had good fun and lots of money learnt lots but I got to a point where I felt like, okay, I’ve had enough of this, I sort of describe it like sitting in the corner desk in the office and every day my staff would come up to me with their wheel barrels of crap and pile it at my desk. So I found myself dealing with stuff that had very little to do with why I started the agency. So you know, HR issues, quality issues, finance issues, client issues and I woke up one day and thought I don’t want to do this anymore. We got sort of seduced somewhere along that journey into the idea of selling the agency. It took us about 18 months, but we were kind of fortunate that we had two buyers interested at the end. So we were able to sort of play them off against each other, do a deal. I ended up selling out to a large us company and did a two year prison sentence with them as I’d like to call it, which is my two year earn out, which was not the best of experiences. I’m sure anybody that’s sold before will really relate to some of this. Got to the end of my two years and they actually offered to sell me the agency back for a pound. And I said, no thanks because at that point they, you know, there wasn’t much intrinsic value left in it except for some of the people not of them had left by then. So I left and thought, what the hell am I going to do with the rest of my life? I was about 39 years old, didn’t have millions and millions of pounds in the bank to go and live on a desert Island, and neither did I desire to do that. So I freelanced for a while, worked at some big firms like Adelman, earned lots of money, but again, thought this is not what I want to do. Then the kind of universe came along and conspired in two separate people in my life, both at the same time, almost suggested that I would be a good coach. I’d done some, a lot of youth charity work and when I look at that really what I get out of it’s coaching. When I look at the stuff that I enjoyed most about running my agency, it was about, you know, the thing I’m proudest of now is how many of those staff over the years have gone on to do amazing things. So it’s kind of coaching there a bit and I think once that happened, you know, I saw the light again and threw myself into coaching and then fast forward 13 years to where I am now. I guess, I’m certainly not alone. I know you, you’ve had the same journey really. But what makes be a bit different to some other coaches is the fact that I’ve been there, done it and most of the time I can really relate to the situation my clients in and can share with them some of my own personal experiences as well as of course the experiences that I’ve seen other agencies go through and there’s an awful lot of commonalities on that journey for growth.
Lee Matthew Jackson: Absolutely. What I like as well about your story buddy is I can actually Google CIT PR and find that you did a contract with Revett Technology and all sorts of stuff like back in 2001 in the old PR week magazine.
Rod Da Costa: You’ve done your research. I know that the press release about the sale of the agencies on PR week still as well. So if anybody wants to check that out they can see that my numbers are on that are near enough correct.
Lee Matthew Jackson: Also adds the credibility as well there. You know, cause a lot of times I will engage with coaches and actually this is not really relevant but it kind of is at the same time. I’ll often be targeted by potential coaches, especially agency coaches via Facebook because somehow Facebook picked up in the algorithm that obviously I’m interested in agency life and run an agency. So there’s always these people who appear in my feed that I’ve never heard of and I find it very difficult to find any information about them and yet they are trying to convince me that they have said system that’s going to triple, quadruple my agency and allow me to work on a beach and stuff like that.
Rod Da Costa: Exactly. I bet those pictures are of them standing in front of fancy cars.
Lee Matthew Jackson: Yeah with certificates behind them as well. There’s usually a whole load of certificates if they’re in an office and it’s very Americanized, which was actually why when we first met I was like, dude, can we have a chat first? We had a great conversation. I was really, really encouraged and of course did some, did some research on YouTube, make sure you’re the real deal. So folks, we are talking with Rob Da Costa, the real deal business coach and I want to pummelled you make for a little bit of information. There’s a very common conversation that goes on in our communities, both in the premium, both in the free community as well and that’s mainly pricing. Pricing is one of the biggest bugbears of an agency owner. Most of us will have started as freelancers. It’s a race to the bottom when we’re initially a freelancer because we want to try and win some clients, so we’ll do a bit of work for free and then we’ll do some quite cheap work and then often you’ll get stuck in that cycle and as you grow your agency and actually start adding staff, etc, what you’re having to do is grow based on volume and you’re just charging not enough all the time. Growing on volume is exactly where I was many years ago. It was always a race to the bottom. We have all these employees and you just have to keep getting the projects in so that you can just scrape by. It is a prison sentence. I love how you said that. I know you’d been bought out and you still had to stay for another two years, but even that situation that I’ve described is a prison sentence for an agency owner because you can’t get out of it.
Rod Da Costa: Yeah, definitely.
Lee Matthew Jackson: So could you first of all, share with us, Hey, have you been on that journey yourself? And B, what can we do to start seeing pricing differently?
Rod Da Costa: Yeah, so I mean, let me answer. This is something that I’m really passionate about and I just want to say to your listeners because they probably similar it to my clients to everybody thinks they’re unique and everybody thinks that you don’t understand my situation and therefore you can’t apply this pricing model to my business because I’m unique and my market is unique, but I just want to burst that bubble and tell everybody, none of us are really unique. We can all apply some of the concepts of value pricing to our business. We just have to be willing to do that and have to be willing to get out of our kind of comfort zone of charging by the hour or the day or fixed rates or retainers or whatever. I’m a bit of a story teller, I think. So a good way to highlight this is my own personal story. So, I explained how I sold my agency, lost my way, found my way, did my training to become a coach and then started off out on my own. The very first potential client I won, or the very first client I won, this is what happened. I went to meet them. I talked about what I did, I sent them a proposal which included a day rate and they came back to me and they said, Rob, we really like you, but we’ve met one other coach and his day rate was 150 pounds cheaper than yours. So if you can match his day rate, we’ll take you on. So the very first client I ever won, I had to discount my work in order to win it. That taught me a really good lesson very quickly, which is don’t charge by days because you commoditize what you do. Don’t charge by hours, don’t charge that way because it’s just a commodity and people start comparing one person’s hourly rate or day rate to another’s and that you know that that’s just not the way to do it. So when we take more of a value pricing approach and we talk about the outcomes and the transformation the client’s looking for, it becomes much harder for them to ask for a discount. As if they want a discount, you can kind of tongue in cheek say to them, well, okay, which bit of value don’t you want me to deliver? So my personal story was like genuinely learned that straight away. The first piece of work I took on, I was selling a lower rate than I wanted to. And guess what? When you start getting busier, you start then resenting those kinds of clients because you filled your capacity with lower value work than you could have you sold on value and didn’t discount.
Lee Matthew Jackson: Could you describe for us what selling on value is? I do feel this is a concept that many people don’t fully grasp. I’ve often seen people kind of alluding to is it surely not robbery as it were? Or why should you be getting all of this money when actually all you’re doing is spending so much time? As in our heads it’s still time for money. So what is value pricing? How do we get out of that mindset?
Rod Da Costa: Let me answer that in sort of three ways first of all. So the first thing, let me just explain the fact that we sell four things and if we look at those four things, we can start to understand value pricing and value selling a bit clearer. So the four things we sell our clients are inputs, outputs, outcomes and impacts. So inputs are the things that we do, the resources that we need to deliver a project. That would be the people, the time, the software and so on output silos, the completed tasks and deliverables from those inputs from that project. So that could be a logo design or press release or whatever. Those are the things that often people feel comfortable with. So when they’re pricing, that’s how they might price. Then that leads them to the sort of fixed project prices or it leads them to time based pricing. The thing that the client’s really interested is it’s the last two points. So outcomes and impacts or outcomes are the results that the client gets from the work that you’ve done from them. So I always talk about that as a transformation. Someone’s in point A and they want to get to point B and they’re paying you to help them with that transformation. So it could be that, you know, someone’s got really poor branding and the transformation they’re looking for is great new design to increase the quality of their branding and therefore their brand awareness. It could be the fact that someone comes nowhere in Google and the transformation you’re taking them is to get them onto page one of Google. It could be that they have no awareness and the transformation you’re doing is a PR campaign to drive awareness in their key markets. So that’s those, the outcomes that the client’s looking for and we need to map what we’re doing for our clients based on those outcomes. Then the last part of those, the four things that we sell is the impact. This is much harder to define, but this is the longer term benefit of the work that you’ve done for them. So helping them become a top three player in their niche or helping them get more inquiries and make more sales and grow their business.
Rod Da Costa: So this all starts with the conversations that you have with your clients or your prospects when you first meet them because if you have a conversation with a prospect and you ask them, what are they looking for? What are they trying to achieve and what would success look like? What does their world look like in a year’s time from now? If you can fact find and understand that information. Then when you write your proposals, you talk about those things that the client’s looking for. Then you can put a cost and a value by it. Whereas if you’re just talking to a client on a very tactical level and they’re saying, Oh, we need a new website, or you know, we’re told we need to do some SEO or we need to do some PPC or whatever it is, then you’re just talking in a very input output base level. That leads the client to say, well, how much time has this cost and what’s your day rate and all the rest of that. So I would say that the values selling idea starts from when you first meet a prospect and the questions you ask them. So you need to say to them, what would success look like? What are the goals that you’re looking for and how does your world look in a year’s time? Like I say, and then map your proposal to those things and then put a price against those things. So I always think to explain the whole concepts of value, pricing and value selling, we need to start off by understanding those four areas and understanding that we may internally in our agency focus on inputs and outputs. But what the client cares about is outcomes and impact. People will have an experience as saying, we worked our socks off, we did everything, all the tasks that we agreed with the client and the client still wasn’t happy. That’s because you weren’t selling against those outcomes and impact and someone in that client company has said, hang on a sec guys, we’re spending this money, but what’s the outcomes and the impact that we’re getting for it? So we need to focus on those areas and that aligns us much better with the clients expectations.
Lee Matthew Jackson: You’re right, aren’t you about the change in conversation. So I’ll think too many projects I’ve had where someone will come to me and say, I need a five page website. So that’s all we’re talking about. Then we will be saying, okay, well the exchange will be, I’ll do all this. This is going to take me this long, blah, blah, blah, blah, blah, and before we know it, it’s all been based on time and we’ve not really discussed the value or the plans. The different conversation that we could be having is what do you want to achieve? What’s your one year? What’s your two year plan? What are you looking to generate? Maybe as a business? Whatever those conversations are, because that opens up a whole plethora of other options.
Rod Da Costa: So totally true.
Lee Matthew Jackson: Yeah. I remember a time in it once, this is kind of related because this input just highlights how important it is to ask these sorts of questions because one of the managers came to me, and I’ve told this story many times on this podcast. The manager comes to me, Lee, we need a new email server. I’m like, Whoa, that’s going to be really expensive. We’ve already got an email server. I’ve got to create a new domain. We’ve got to do this. Can I do that? Can I have to buy this? You’re gonna have to do redundancy, it’s going to cost us several thousand pounds. I mean this is back in the early two thousands. So it was gonna cost several thousand pounds. We weren’t virtualizing back then or anything. Then I said to them just to confirm then what is it you want to achieve with this email server and that opened up a completely different conversation which was yeah well I want to be able to do is I want to be able to email my marketing department. I want to send it to one email address and it’ll go to all of them in the marketing department. I was like, dude, you do not need an email server for that. It’s going to take me five minutes to create a group on the domain and then job done and then all you’ll do is email marketing team at. So we actually got to save a lot of money. So it’s kind of the opposite. But the, the the question, the important question was what did you want to achieve? As I was going in the completely other direction with this thinking they’re going to spend loads of money.
Rod Da Costa: I think sometimes people are a bit scared of asking that question because they are not confident that they could deliver that or because they get very excited about someone saying, can you build us a new website or can you, set up this email system for us. They get excited by that. But if you don’t ask those big important questions at the beginning, there’s a really strong chance that you won’t delight the client and you won’t retain them for the long time. We all know that it’s way cheaper to keep a client and grow a client and get additional revenue from existing clients than it is to keep finding new ones. So we want to make sure that we’re on the same page and that we’ve asked those questions. I think a really good point that you just made, Lee, was the fact that when you broaden the question, it actually opens up a whole load of other opportunities for you. So if you ask them what is it you’re trying to achieve, you may suggest, okay, you can do that really easily. But you also may suggest actually there’s several other things that you should think about that you haven’t even thought about. And guess what? When you have that conversation early on, you’re really positioning yourself, the expert consultant. That’s what we need to do. You know, in all stages of the sales process, we need to be positioning ourselves as the experts and the consultants so that we have this, consultative partnership relationship with our clients as opposed to kind of the customer supplier. You know, where the customer beats you up because you’ve taken a day longer than you said or someone’s not happy. So all stages of the sales process, from the very first conversation, we need to be showing our clients that we’re experts, that we understand their marketplace, their challenges, their niche, whatever, and that we can provide consultative advice on the best way to get to those outcomes and impacts that they’re looking for.
Lee Matthew Jackson: I can think of so many occasions where we’ve had conversations on a website project and it’s always become so much more than that. There’s going to be needed CRM integration, there’s going to be a social media campaign, there’s going to be potential for SEO and we’re not a full service agency so we’ll actually get other people involved potentially in those. So there’s other opportunities. But what we’re doing is wait, we are helping delight the client because we’re helping them to achieve all of the things that they want to achieve. The problem is is they think that they just need the nail but they forgotten that they also need the piece of wood to put the nail into and they also need the hammer and they need everything else. By me being that person to say, have you considered X, Y and Z , have you considered this bigger picture? Have you considered this as how we can track it, etc. That has always led to bigger and better opportunities. Like you said, a delighted client, a client who now has something that they can measure. Can we speak into that fear element? It was kind of a passing comment and it pricked my ears. Quite a few people are, you said us scared by the idea of selling based on that. So we’re going to help you to achieve something. You’re right. That’s actually quite scary. Can you talk into that and reassure us?
Rod Da Costa: Well I think that partly it’s because the world in our agency world anyway, the, in the past people are very used to and feel comfortable with the idea of selling days or selling a kind of cost plus approach to pricing where you work out how much you think something’s going to cost and add on a margin, you know? Or they are used to selling a retainer where they outline the tasks. That’s the inputs and outputs that they’re going to do each month on that piece of work. So I think we’re very used to that approach and so people feel comfortable. I think that the fundamental issue that isn’t really selling what the client wants and actually the client doesn’t care. There’s another massive issue about this approach and that is the fact that when we, I know I’m not quite answering your question here, I will get to it. When we report to our clients based on time, we also suddenly assume that the client has some expertise on how long something takes. I have a client at the moment, I won’t name them because they might be listening to this, but I’ve a client at the moment. I’m battling this with them on their, they’re a very successful sort of 40 man SEO agency, but they just bill on days and not only do they bill on, but they report on days and guess what did they send their monthly reports and then the clients go through them with a tooth comb and say, why is this particular task taken so long? I’m like, how do you know you’re just asking for trouble because you’re assuming that the client has some expertise on how long a task takes. So it’s, there’s just a a hundred reasons why that’s a really poor business model.
Rod Da Costa: So, you know, if we’re in the agency world of that’s how we used to billing in that sort of time-based or project based or retainer based model, then we have to be brave to step out of our comfort zone and take a different approach. As I said, that starts from the very first conversations you have. So the reason why it’s fearful is because even when I meet a prospect for the first time, the way I talked to them, would it be different to how I would have talked to them in the traditional world. So instead of saying, okay, you want a website, show me some websites you like, you know, what do you want your website to do? How many pages, branding, all that kind of stuff. We start by saying, well hang on a second before we get into that, let’s just understand your business. Let’s understand the aspirations for your business. Let’s understand how the website and your external comms would contribute to the business goals and the, and the revenue targets. Then let’s just work out whether what you’re saying is the best way of doing it. So actually from the beginning, you have to be brave because you might actually be saying to the client, actually, it’s not a website that you need. It’s something else, like you said, with the email server. So you have to be brave there to even push back on the client. But I always think if you do that and you show your credibility and your value early on, then you know, you’re, you’re headed down the right path with that client to have a really good relationship. So I think people fear taking this approach. I think the other thing they fear is that it’s harder to measure and it’s, it’s a little bit more amorphous than, you know, reporting on time or something, which is obviously very easy to do.
Lee Matthew Jackson: I think people might also be worried that they won’t be able to deliver. Sure, I might be able to deliver the website and the integration with the CRM, etc but my concern might be that I’m worried that the results will not happen regardless of what I’ve recommended. So I think there’s often a fear there when people are happy to stay in what I think you described as the discomfort zone really of the per hour and having the fine tooth comb going for it. But at least you, you have a kind of negated responsibility for the results kind of even that the client doesn’t see it that way. Whereas in this way you are kind of sharing responsibility for those results. If I am positioning myself saying what are your targets, right? You’re aiming to get this so I recommend you do this. I’m now in essence taking responsibility for some of that.
Rod Da Costa: Yeah, but value pricing and value selling isn’t a payment by results approach. That’s a question I get asked a lot. Does this mean we should be doing payment by results? You know I have another client, a PR agency that does actually do payment by results by, which I think is interesting because it separates them out from their competition. But again, it gets, I think it gets people focused on the wrong things. So I think one of the questions you have to have early on with your clients is how do you measure success? How would you measure success with this? And you have to get them thinking about that. If they come back to you with some crazy unrealistic measure, then you have to explain to them and we’ll actually, that’s probably not going to happen. So you have to have that negotiation with them. But I’ll tell you what, if you have those difficult conversations early on and you get you and the client on the same page and you report as much as you possibly can, as the project goes along against the outcomes that we’re trying to achieve, you’re going to have a much stronger and a much longer relationship with that client. They’re probably going to be giving you additional work along the way. So I think that’s the thing people need to hang on to here.
Lee Matthew Jackson: No, that is really helpful.
Rod Da Costa: There’s one other really important point that I want to make about this, that people feel uncomfortable in the agency world about value pricing and value selling. But we in the bigger world are surrounded by it and if we go back to the coffee thing that we started this whole conversation with, who’s determines that a cup of coffee is worth £2.50 or £3.20. I was driving up the end one yesterday to your neck of the woods. Actually I was in Milton Kings yesterday and I stopped off at the services and did go to Costa and bought a coffee and it was £3.20 For a flat white or something. Who determines that? That’s what that’s worth because let’s face it, if we’re just doing a time and materials pricing on it, well you know, it’s probably worth 20p the cups, probably 5P and the coffee granules are probably 10p and you know, the hot water’s 5p. So, we are surrounded by value pricing in our world and I think people need to step outside of the agency world and just look around them about to see that everywhere we go we’re surrounded by value pricing and value selling.
Lee Matthew Jackson: I’ve got a great question for you here. This is something we’ve heard a few times and I’ve written the statement down so you can read it if you need to, but essentially this: What is right or wrong with this statement, if the client’s going to turn over 1 million pounds using this new website, I’m going to build them next year, then I should charge at least 10% of that 1 million.
Rod Da Costa: Yeah, I can completely, I think it’s great. I mean, the way that’s positioned, there’s a danger that it’s a payment by results and we have to wait for a year. But I think it’s absolutely right and if you ask the questions early on about what their outcomes they want to be and what transformation it will make. Here the transformation is to, you know, earn a million pounds, then it’s absolutely a good way of pricing it. So if you said, okay, we’re going to turn over a million pounds so we’re charging a hundred thousand pounds for this project, that looks very different to saying, well actually it’s going to take four days of a designer’s time and 10 days of a developer’s time and you know, four days of a project management or whatever and pricing it that way.
Lee Matthew Jackson: At the same time, if I was say that, and I’m playing devil’s advocate at this point, if I say, right, well I’m going to charge a hundred grand for this because I know they’re going to turn over 1 million. Am I not therefore taking responsibility for their results regardless of what we say?
Rod Da Costa: No, not really. Again, I think, I mean you wouldn’t, I think in terms of that statement, I would never say it quite like that.
Lee Matthew Jackson: No, but it’s what we hear.
Rod Da Costa: It’s very black and white.
Lee Matthew Jackson: Feel free to challenge it.
Rod Da Costa: Yeah. If you are having that conversation with your client in the sales process and you said, what do you hope to achieve from the website? What’s it trying to do for you? And they say what we want it to be a contribution to turning over a million pounds. Then the next question would be, how are you gonna measure that? So I don’t think it’s about you taking responsibility, it’s about you working with your client to understand what it is they’re trying to achieve and understand how they’re going to measure it. So you can determine whether it’s realistic or not. Sometimes that won’t be realistic and you would actually need to sort of go back to the client and say, well actually the website on its own isn’t going to generate you £1 million. You need to have a really solid marketing strategy around driving traffic to the website around converting that traffic and measuring it. So in itself, that statement is kind of part of a much bigger conversation.
Lee Matthew Jackson: You didn’t fall into the traps. So I appreciate that, and that’s the important things isn’t it? Is how you’re going to measure it, but also that honesty. It’s not about the numbers necessarily. If a client does want to raise a million, we shouldn’t just take 10% because we assume the website is going to therefore generate that 1 million. We should actually be having a reasonable and realistic conversation both with the client and with ourselves to say, what will the value of our contribution be? You know, with the website, if that’s only a piece of the puzzle, is not necessarily realistic that we should be charging a hundred grand if actually what they really need in their particular industry is a long sustained social media campaign and they’ve got to invest a lot of money in that. So that’s probably the direction that most of that research sources are going to be going into etc. So there still needs to be balanced.
Rod Da Costa: Yeah. I think it’s the point is really is you’re having these kinds of conversations before you’ve written a proposal. Then when you put a proposal together and it talks to that transformation that the client’s looking for, the pricing of it becomes a lot easier. Whereas if we just had a conversation with the client that says, okay, we need a new website, and they said, what’s the timescales for that website can you give me some pricing than the kind of proposal we’re going to write? When you’ve had that conversation is going to look very different to the one when you’ve had this first conversation. I think, I think it’s worth sort of saying at this point as well. The sharing with you. The thing I said when we first chatted, because I think this highlights this value piece as well and I think it’s worth saying that when we’re looking for something in the world, a cup of coffee, a new website, a coach of whatever it is, we are looking for that transformation and that transformation typically looks like from being in pain to not being in pain.
Rod Da Costa: So being in pain because our website just doesn’t work and doesn’t represent our brand to not being in pain because now it really represents our brand and is driving lots of traffic and revenue or being in pain because we’re my, our agency is going round in circles, hitting brick walls and not going. Then I get a coach and the pain I don’t longer have is because I have a clear roadmap and I’m feeling confident and clear again. I always highlight this pain thing by telling a story about pain, which was earlier this summer. I woke up on Saturday morning with toothache and by Saturday night I was in agony, had no sleep Saturday night really in pain on Sunday, couldn’t get to a dentist. Monday morning I managed to get to my dentist first thing in the morning on an emergency appointment and they told me that I needed to have my tooth removed and I’m like, do whatever you need to do. Just get rid of this pain because if everybody’s had to fake is really painful. Surprisingly quickly they managed to extract my tooth and almost immediately the pain went and I went up to reception and they said, that will be 350 pounds please. I gladly handed over my credit card and paid 350 pounds. Now nowhere did I say to them blimey, 350 pounds for 20 minutes work is really expensive. Because they would have turned around to me and said, okay, well if we took four hours to get rid of your pain and charge you 350 pounds, would that have made it more valuable? Of course the answer is no. So I wasn’t buying the dentist’s time and this is what we all need to remember that we sell three things fundamentally, we sell our skill to deliver whatever it is that we do. So that would be dentistry in this case, or web development or coaching. We sell our years of experience and we have to put the value on that. That’s where people don’t put value on it. Then finally we sell our creativity in our strategic insights. What I see is people put lots of value on the first thing, that’s the thing that they deliver and not enough value on the years of experience and the creativity and strategic insights and that’s where you really look different. So that dentists could get rid of my pain in 20 minutes because she knew exactly what she needs to do. She had the skill to extract my tooth without any really discomfort and the skill to identify very quickly what the issue was and what the solution was and deliver it. So we all need to remember that we are selling our clients at transformation from A to Z and that is from them being in pain to being out of pain. It’s our job in the sales process to identify what that transformation is that the client’s looking for and then speak our solution to that transformation.
Lee Matthew Jackson: That is definitely one of my favourite stories.
Rod Da Costa: Yeah. Well listen, it’s funny, isn’t it? Some. I mean it’s just a great story, although honestly I was in a lot of pain, I did come back from the dentists afterwards and I thought this is a brilliant example of value selling. Another example just to highlight the fact that we’re surrounded by value selling. So it’s not something weird is, I know I’ve written about this, but is bottles of water, so I don’t know if you saw this song, I wrote a blog recently on value selling pricing, but how much is a bottle of water worth? Well, you know, on a time and materials it’s worth whatever the plastic is, the glass is.
Lee Matthew Jackson: Pennies.
Rod Da Costa: Pennies, yeah. So if you went into a shop today, right now you are, I went into shop and we bought a bottle of alternate cost as a pound. We’d probably pay for it. We think that’s what they cost so we buy it. But imagine if you were in the middle of the desert and you were dying of thirst and you were walking along and suddenly in the middle of the desert there was a guy with a bunch of ice cold bottles of water. How much would you pay for that bottle of water?
Lee Matthew Jackson: Hmm, a thousand pounds.
Rod Da Costa: A thousand pounds exactly. So something is worth what we willing to pay for and in that case, it’s value, the transformation was dying of thirst to literally not dying of thirst. So we are surrounded by the value selling everything, houses, everything we do is based on, you know, we’re surrounded by it. So I think anybody who’s having any doubts in their agency about taking this approach just needs to look around them a bit and see that it might not be so common in the agency world but it’s definitely common elsewhere in our world.
Lee Matthew Jackson: I think as well with value pricing is there’s something missing and that’s valuing yourself. You were talking about those three things you’re selling and part of what you are selling is yourself, your expertise, your creativity. That is very much unique to you and often as agency owners, we have been battered as it were by clients and by agreeing to exchange time for money so much so hours that we’ve forgotten how valuable we really are. So folks, I just want you to be encouraged by everything you’ve heard today from Rob, it’s brilliant. Those stories that grey other than him having pain, that’s terrible, but they are great examples and remember that you are valuable and that value let pricing isn’t just about what you’re providing but it’s also about you and you are valuable. If you’re not feeling valuable, then please join our Facebook community, have a conversation in there and connect with some friends cause that’s another problem we have in agency life. A lot of us are lonely and we are just going at this alone. So come and join us in our Facebook community. There will be a link to that. There’s also going to be a link to Rob Da Costa’s website and also to that blog post with regards to bottles, which I recommend you have a read of. Now Rob, you’re also doing something a little bit different. It’s the agency accelerator. Can you tell us a little bit about that please?
Rod Da Costa: Yeah, sure. I’m knee deep in that at the moment. So, for many years there has been a segment of my target audience that I haven’t really been able to serve through my face to face coaching either because they are geographically a long way away. They don’t have the money to invest in the coaching and they believe that they don’t have the time to commit to doing the face to face coaching. A few times people have asked me, is there something I can do to support this community of people? And I haven’t really been able to have an answer before. So that’s led me to launching on Monday, that’s next week, which is the 7th of October. I’m not sure when this will go out, but I’m launching opening the doors for my first round of this programme.
Rod Da Costa: So what it is is a 12 week coaching programme that starts with a one-to-one call with me to kind of identify your challenges and set out a unique roadmap over that 12 weeks. Then we’re going to do weekly group calls where people can ask questions and get support from me and also the other people in the programme. Then at the end of it there’ll be another call with me to kind of assess where you’re at and what your next steps need to be. They will also be about 30 plus hours of online content that people can watch and have lifetime access to at their leisure and a whole bunch of tools and templates to support the various things that we are covering during the programme. So I’m super excited about this. It’s interesting kind of taking this full circle, going back to the online world and like you said, Lee, so many people out there claiming, you know they’re experts and so there’s a lot of noise to break through. I appreciate that this programme isn’t unique and there are other people doing it, but obviously it’s something that my market’s asked me to do and I’m sort of super excited to finally be providing something for them. So we’re opening the doors for a week next week and then it will open again next year at some point.
Lee Matthew Jackson: I think what I’ve learned as well is that yes there is a lot of noise and some of that noise is really bad and it does frustrate me. But equally there is also a lot of noise where there are some really good people who really want to help. I recognise that people learn in different ways and people will learn from different voices. So perhaps some people will listen to me when I explain something and they’ll get it and they like my style and they gravitate towards that and they want to align themselves with my journey. Equally as the way you’ve described things with your stories as well, people might gravitate in your direction and that’s also good and perfectly fine. If folks are going to get more value by the delivery style, the story style from someone like Rob, then I would definitely encourage you folks to check that out. There’ll be links to all of this in the show notes, folks. All that is left for us to do, Robert, is to say thank you so much for your time and wonderful day.
Rod Da Costa: Thanks Lee.
Lee Matthew Jackson: Alright, cheers buddy. Bye bye.