When consulting with start-ups, the 1 trend I notice is that most entrepreneurs tend to underprice their products and services.
While it may seem like great value to offer a service at $50 a month, especially when your expenses are low, it doesn’t make sense in the long run. That’s because your growth will be constrained by providing products at a low price-point.
To bridge the gap from bootstrapping startup to a business with sustainable growth, here are 3 strategies to incorporate into your business model:
- Offer a premium/upsized model
Talk to your customers and find out if there’s a “bells-and-whistles” version of your product that they’d like to get their hands on.
Additional features and functions, optional templates, greater scalability, the ability to support multiple sessions, lower latency, a more resource-friendly version are all items that premium customers might consider.
Why sell a “plain vanilla” (excuse the pun) fudge sundae, when customers might want a triple-chocolate, molten cocoa heart-stopper sundae with cookie dough, cotton candy and strawberry mix-ins?
- Offer an end-to-end, turnkey solution
Find out if your customer wants help with installation, customization, long-term customer support. See what else they might want as part of a complete solution.
Often, budding entrepreneurs are too happy to sell 1 unit of their product, and scoot back to their research lab.
Why not take the opportunity to provide a complete service and use the opportunity to gather more product feedback.
- Subscription and continuity income
Your utility company, your cell phone operator, internet service provider, cable TV operator all do this. They continue to provide service each month and collect a steady stream of income.
Why not do the same too?
It not only generates cashflow, it also opens up opportunities to further develop your customer service resources.
While there’s no surefire way to grow your product income, these methods will go a long way to finding out what your customer wants, and enhance customer stickiness.
In the long run, it just might bring your product income to the next level.