Week 38 wrapped up today in the Empire Building Kit. One interesting topic that led me to do a bit of reflection, was the benefit (or harm) of focusing on earning more money versus trying to gain more customers. A fellow “Emperor in Training” recently decided to conduct his own experiment with pricing. After doubling the prices on a certain product, he saw sales of the product go up significantly. He hadn’t made any changes to the product, but the jump in sales earned him an extra $35,000 that he hadn’t expected to earn! Unfortunately, he didn’t feel comfortable providing many other details about his business or product, but the assumption is that the increase in sales and overall dollars earned, justified the possible loss of the lower tier of buyers for him.
When I opened my new shop of whimsical cards and prints at A Talent for Design at Etsy, I was approached very early on by my first customer. She wanted 35 cards of one of my designs. Needless to say, I was very excited not only to have my first potential customer, but that it was a bulk order sale. However in corresponding with this customer, it became clear that she not only wanted me to customize the cards specifically to her needs (which I was happy to do at no extra charge) but, unfortunately, that she also wanted the cards at almost a 50% discount. As much as I wanted the sale, I couldn’t bring myself to start off my business in a way that felt like it would be undervaluing my time and cutting significantly into any profit I’d make from the sale.
My decision cost me the sale AND the customer. Granted, maybe that type of customer is not one I should be trying to cultivate, but I still wonder at times if I didn’t make a mistake. When you are starting out, should you discount your product, or does that send the wrong message about the value of your work? What’s worked for you?