Far away, man.
Can you hear me okay?
Got you, man.
Fantastic. Hey, last week we talked about pricing. We talked about a niche of realtors. Specifically, if you recall, we talked about how the best price that you were going over lifetime value. If we have a number, say we have a hard number, say for splitting a real estate deal, say we're talking about a $300,000 house average and split that on 3%, it's like nine grand. A full deal taking both sides, 6% is like 18 grand. How do we price that? How do we price out? If we're going to do an annual plan like we talked about, an annual or a semi-annually backing into those if we have to down sell. I'm trying to figure out what ratio to go in with. I'll go in with a $5,000 for an annual on a real estate transaction.
To me, that sounds fine. All of the marketing tricks in the world come into play. It's like if you're going in with 5,000, people are going to expect you to discount it. But if you go in at 10,000 with a line through it and then say, $5,000 special offer, then people will be like, Oh, my God, I'm getting a deal. Okay. How to price it? We want to... What's really interesting to me, so just philosophy for a second, David, what's really interesting to me is that people raise their prices as their confidence rises. In almost everything that we do, and especially in agency land, which we all in, we see it time and time again where people will go in and they'll be like, Okay, I'm going to do a website design foror I'm going to do SEO or I'm going to do lead generation or I'm going to do lead generation, or I'm going to do something, and I'm just getting started in this and I'm going to charge 300 bucks a month. They work really hard and they get some great results and they're like, Wow, that was great. They stay on that 300 bucks a month for a little while and they're like, You know what?
We're doing this great. We're working hard. I think I can bump this up to 900 bucks a month. Then that's going really well. They put somebody else on and they realize they can outsource it. Now they're at 1,500 bucks a month for the same thing that were charging 300 a month for six months ago because price rises as confidence rises. Here's the thing. I had somebody pop into the Facebook group, actually, it's one of the threads that's one very recent. David, it might have been you, actually. And he was like, You said something... Sorry, I'm not saying it was you, David Stone. I just thought it was. But it was like, Mind you, if it was so good, wouldn't White Label Suite be charging more for it? I was like, Man, that's so interesting because what we started with in terms of our pricing is now $10,000 to get in with us. And so we're guilty of the same thing. It's like, your price rises as your confidence rises. So what if you could shortcut that time frame, David, Arnold? What if you could shortcut that time frame in terms of proof of delivery? So again, a little bit of philosophy, but now let me come back with my answer.
How confident are you that you can win in this environment?
I'm very confident.
Okay. And $5,000 a good deal for that client?
That's my question. I don't know what the average going rate is. It's happening to me.
Let me ask it a different way. $5,000 for an annual package. My question was, is that a good deal for the client? Let me ask it a different way. If you get this client, as many deals as you feel you're going to in this 12 months, and 12 months is a heck of a long time, despite the fact we just said time is going so quickly, are they going to get a positive ROI on that?
Then that is a no-brainer. That is an absolute no-brainer. Mr. Client, popped down five grand. I appreciate that that's a heck of a chunk of change, but in exchange, you're going to get this. Nothing is too expensive if the value is provided. Somebody rocks up and says, Hey, do business with me. I haven't got any money. Look, if you put down $10,000, I will make sure you've got a $100,000 property portfolio in 30 days. Dude, just give me 10 minutes.
I'll get 10 grand. With five grand, the way I logically back into that, just thinking about it is that if they split a deal with 3%, they're at close to 10 grand. I've've got two years to produce. I've got two years to produce.
Now, from what you've just said to me, that's an amazing deal for the client. I would make sure that they know about it. Let me ask you on the other side, is it an amazing deal for you? Is that going to give you enough juice, enough meat on the bone, enough business collateral to grow and to do this again? Because the death trap of this offer is that it's a lot of work for you and you're going to have a chance to grow. The golden ticket of this offer is, does it give you enough meat on the bone to take some of it and create the next opportunity? Take some of it, pay the staff, pay yourself, pay the mortgage, cover the bills, and still have enough to do another one and another one and another one. Is there enough meat on it for you to do that? If not, chuck another two grand on it before you even start. Does it have enough meat for you?
Yes, and I will be outsourcing, for sure.
To me, David, Arnold, what that sounds like is that you've thought about the offer, you've picked a price that is great value for the client, that is going to service you and your community well. The only thing that I would recommend is the delivery of that offer to make sure that when you deliver it, it's actually delivered as a $50,000 offer so that the client goes, David, that's a no-brainer. Right? Yeah, just to me, that sounds like you've nailed it, man. It sounds like you're right in the right spot.
Yes, sir. Thank you.
You're welcome. I'll just finish with this one. I think I've said it to you on a call before. Do you guys know who the graffiti artist, Banksy, is? I only know him from notoriety, from being in the news and whatever.
I've seen it on a documentary.
Yeah, right. Okay. There's a dude with a spray can who suddenly is worth hundreds of millions of dollars. I've seen some of his work, that one with the balloon going up and whatever, and my kids could do a better job. But because he's Banksy, that was like $30 million for the piece on the wall that he drew on. It's not worth it to me, but it was worth it to that guy, whoever it was that paid that money. It was worth it to him, right? And the highest value artwork sale of any time just went through a few days ago, $314 million for a glimp, I think it was. They don't sell the Mona Lisa, but what would it be worth if they sold it? Is that worth $314 million to me? Well, no. But it was to that guy. My point being, when you rock up to this client, your price has a value attached to it. Because you're working in this real estate niche, and guys, this is for everybody, whatever niche you're working in, the value that you provide is a multiplier of what you're going to deliver to the client. If I can go to a client and say, If you pay me $5,000, I will guarantee you $5,001.
They're going to go, Yeah, man, it's not really worth me pulling out my… No, no. For a dollar, I could do better. But I will do $5,000, and in return, I'm going to get you this, this growth, this 20% here, system over here, this over there. In the end, that's going to create for you a valuation of your business, a valuation multiplier in your business of 3X. Rather, just stand by, let me get my checkbook. You know what I mean? It's how we deliver the value offer to make sure that to that buyer specifically, you are delivering something that is a no-brainer. Man, this is so easy for me to make this call. I don't even need to speak to my wife. Let me just go. It's all good. It sounds like, to me, David, it sounds like you've thought it through. You've got an amazing offer to deliver. You've got an incredible niche to value up in. Great job, man. Let us know how you go. Thanks, David. Appreciate you, man. You're muted, but I can see you saying thank you. Thank you. Thanks, man. Thank you so much, David. Again, I'm super thrilled with how you work that through, man.
That's super cool.
Was this article helpful?
Thank you for your feedback
Sorry! We couldn't be helpful
Thank you for your feedback
We appreciate your effort and will try to fix the article