Join our list and get the latest best practice insights in your inbox every fortnight

Pricing & The Importance of Loss

 

This book was gifted to me a while ago and as you can see by the dog ears, it is by far one of my favourites.

 

It’s called ‘Priceless: The Myth of Fair Value’ by William Poundstone.

 

I’ve read it many, many times and I think right here and now given everything that’s going on the industry, it’s worth revisiting some of the concepts.

 

Now, the concept I want to share with you today is probably one of the key ones to understanding how clients think about your services when it comes to whether they should continue with you or whether they should leave.

 

You need to know this in order to make sure you can retain clients as effectively as possible.

 

The big secret here is….

 

This idea of loss versus gain.The reality is we as human beings, are far more attuned to the risk of loss.

How does this manifests itself in your world?

Well, let’s say you’re coming up for renewal discussion with a client.

You have this idea about talking about all the things that you’re going to do the next year, all the services you’re going to deliver.

Don’t get me wrong, this is a good conversation to be having.

But, understand that the number one thing that is going to stop clients  or keep clients from continuing to work with you is their focus on -“What will I lose?”

 

Specifically, if they choose not to work with you anymore they stand to lose :

  • The fact that you probably know more about their financial affairs than anyone else.
  • They’ll have to start again from scratch
  • Maybe they’ll lose access to certain reporting you did.
  • They’ll lose the ability to phone up and ask questions.

 

They’ll lose all that financial his gory of where their situation is and how they’ve done it, and they’ll have to find somebody else to start again  g

 

You with me? Now, this is key because …

If clients are thinking about disengaging, they are now mindful of  having to make a decision.

This is the point in time that you will have to make  clear to them, all of the things that they will have to do themselves or no longer have you there to do for them if they disengage your services.

 

If you combine this process with a really great review experience where you talk about the future and you give them clarity, I am pretty sure that every single one of you out there will have far fewer issues when the 12 month renewal comes up.

 

The take home is …

 

When it comes to human beings, we value loss a lot more.

So when you’re having retention conversations with clients understand that although it’s about showing them the way forward, owning the future and knowing the next step, it is equally as important to make  sure they know all the things they  will lose if they make a decision to take it on themselves or disengage.

Hope this is helpful.

If so, please leave a comment in my Inbox. Or perhaps you could share with me – What have you found to be your best tip when it comes to discussing ongoing service with clients?

Keen for more tools, templates & insights?

Join our free best practice portal

Working with a coach shouldn’t be a guessing game.

That’s why we want to invite you to sample for yourself the unique body of training, tools, templates and resources we created specifically to help practices grow, expand and evolve.

Check out what you'll get access to
apg

AdvISER Pricing Guide

Ready to talk 1-to-1? Let's chat.

Related articles

The Art of Pricing: Finding the Balance Between Value and Fairness

Read more »

The Ultimate Guide to Adviser Pricing

Read more »

Careful what you wish for?

Read more »

Is Pricing the Ultimate Lever?

Read more »

Fee Sensitivity Doesn’t Exist

Read more »

The Trouble With Pricing Risk

Read more »

Pricing & The Importance of Loss

Read more »

The 5 Most Common Pricing Mistakes

Read more »

The Pricing Trap

Read more »

Why increasing fee isn’t as risky as you think

Read more »

This pricing conversation had me mad as hell

Read more »

Join List

Join our list and get the latest best practice insights in your inbox every fortnight

Contact us

Let’s talk about how we can potentially help you and your practice to grow and evolve. We believe great advice is becoming more valuable than ever.

Be First To Know

Register your interest to become a participating practice owner or, as a BDM or PDM become an accountability coach

Register for free

There are a lot of insights waiting in since our goal is to provide value first.