How to Use ChatGPT to Build a High-Impact Pricing System in Minutes (w/ Mark Wickersham)

Hello, hello everybody and welcome to this presentation. I'm Isaac, your host. for today. And, uh, today we're going to be talking about an interesting topic, a topic dear to my heart, I think, really important topic in business, which is the topic of pricing and pricing in an AI world. Of course, as technology improves, I think we've all come to question some of the traditional, uh, forms of pricing. And we're bringing, uh, Mark Wickersham, which is a pricing expert that has worked with accountants for over a decade to talk to us a little bit more about his thoughts on pricing in the AI world and how to use ChatGPT to actually set those pricing systems up. So, uh, Mark, thanks for joining.

Hey, thanks for the introduction and thank you so much for inviting me to your show. Can't wait to get started.

Yeah, for sure. Uh, so before we get on, just talk to people a little bit about your background, your experience, the time that you've been helping firms, and you can kind of get going with your presentation.

Sure, yeah, thank you. So I've been in the profession since 1988, so 30-odd years. I've lost track of time now, it seems a long time. Left university, went to work for a large multi-partner firm in the UK. So I'm from the UK, although I live in Portugal right now. Qualified as a chartered accountant in 1991, then became a tax specialist. 1996, started my own accounting firm as a sole practitioner. Built it up from zero to a few hundred clients in the first few years, but realized by the end of 1998, by the end of '98, I was actually in a bit of a mess because I was working longer hours than as an employee and making less money. It was crazy. I'd been growing like crazy but not making money. And it wasn't until towards the end of 1999 that I met Ron Baker, who's one of my friends and heroes, mentors now, and he explained to me this concept of value pricing, and I started to implement it in late 1999. Had a huge impact in the firm, in my business. Some of my prices went up by nearly fourfold with little pushback, and that really enabled me to turn my firm around over the course of a 2-year period. Then I sold it to my team. My client managers bought it off me, and that was because in 2000 I was invited to speak on stage at a conference to accountants to share the mistakes I'd made and what I'd done to fix those. And I've been working and teaching accountants for the last 25 years now, mainly how to implement value pricing in their firms. I run the Value Pricing Academy. That's been going for 10 years now. And most of my audience is in North America, the US, Canada, and of course the UK.

Interesting to hear that. Literally yesterday I was looking, Ron Baker's material on YouTube and some of his interviews because he's like the OG essentially of value pricing. Before we dive into it, of course you've been in it for so long at this point, 20 years. A lot has changed in that period of time, right? But maybe a lot or some things have not. From your point of view, what has changed a lot since you started implementing value pricing back in 1999?

Yeah, interesting question, Isaac. From the point of view of pricing, nothing's really changed. It's one of those subjects that really is as relevant today as it always has been, and the fundamentals of pricing don't change because essentially pricing is all about— it's one of the 4 Ps of marketing. It's all about how we communicate, communicating value. So that kind of is timeless.

Yeah.

But what has changed, I think, is a key part of value pricing is we price based on the value and we have to create more value. So what has changed a lot over the last 20 years is technology. Technology changes things significantly. I think back to the way that I did marketing in my firm many years ago, very different to today because there was no such thing as social media and now social media is so important. Content marketing is so important and all of these these things help us to position ourselves as experts, help us to charge higher prices. But then, of course, as you and I know, the world of AI is taking off in a major way. That's going to have huge, profound impacts on the profession. And some of the predictions that I've been saying when I talk about ChatGPT and AI is that a lot of what we currently do today in the profession, I think, will disappear in the next 2 to 3 years. I think that most compliance work will disappear. Bookkeeping as a thing will disappear. And people think I'm mad when I say that, but that's because I've been studying and watching the speed of progress with AI, and bookkeeping is rules-based. Anything that's rules-based can be completely replaced. And so that means that then calls into question, what is the role of a bookkeeper? What is the role of an accountant 2, 3, 4, 5 years from now? And a key part of that is we've got to change, and we've got to find new ways to create value, to add value. And I see that as being hugely exciting because the thing about value pricing as opposed to the old way of pricing, which is time-based, is the problem with the old way is we price based on hours. So if technology and particularly AI eliminates the amount of time to do something, we will start doing stuff for free. And there are many examples of things that have been in the past where that has happened in the profession. There are some things that the profession doesn't charge for now that they used to. And so time-based billing is going to be an increasing problem because of what's happening in the world of AI, whereas value pricing— why, the reason I'm so optimistic about AI coming along is it opens up new ways to create new value, to create more value. And when we understand how to value price that, it means that we can charge higher prices for stuff that takes much, much less time. when we use the right tools for doing it.

Yeah, yeah, definitely. Well, I'm excited to see your presentation because I know you prepared some material for us, so I'll let you take it away and go for it.

Awesome, thank you so much, Isaac. So I think we'll be— this will be about 40-45 minutes and then we'll come back for some questions at the end, which will be cool. So yeah, we're going to talk about a lot of stuff today on pricing. We're going to look essentially at some of the core foundations of value pricing so we get those right. But what I'm gonna do is I'm gonna really break today into 2 halves. The first half is the foundations of value pricing so we understand that, but then let's look at how we can use technology, how we can, how can we use AI, how can we use ChatGPT to make pricing so much easier? And I'm gonna show you some stuff that I know is gonna excite you and impress you and make you realize this stuff is extraordinary what we can do. So we've got a lot of stuff to cover. I do have a few things, some free gifts. I will mention them at the end, and I think the links are probably going to be in the description of YouTube. But one I will just mention right now because it's timely is it just so happens that in 2 weeks' time, once a year, we run the Profitable Bookkeeping Conference. It's an online conference, it's in 2 weeks' time, and we are giving some free tickets away for free. So we'll put the link to that below and And if you find today valuable, if you want to learn more about value pricing and how we can apply it to our bookkeeping accounting services, then come and join me in a couple of weeks' time when we have a 3-day online virtual conference. Okay, so with that said, let's get— let's dive into— and I forgot to actually just— that was— that's— hang on a second. There you go, there's the details of that. So what we're going to do today then is dive into the foundations of value pricing. And the first thing I want to talk about, uh, the first thing I want to talk about is and deal with really what is the, the single biggest myth about pricing. And one of the things that if there's nothing else you take away from today is that you need to put your prices up. You need to put your prices up because you are too cheap. And, and when I say that, when I say that, I immediately get a knee-jerk reaction from people saying, yes, but Mark, you don't understand, you don't understand, my clients are price sensitive. In fact, when I speak on the stage, which by the way I haven't done since COVID I used to speak in the US a lot, but because of COVID I love this virtual world, I live in Portugal, but when I was on the stage or running workshops, I would actually ask the audience, put your hand up if you have price sensitive clients, and every hand would go up in the room, and I would say to people, no, that's a big myth, you do not have any price sensitive clients, And people would think I'm crazy and I'm mad, but let me just explain for a minute because this is really important to understand this. When you get this, suddenly things start to change. So yes, there are price-sensitive people in society, and we have to recognize what that means. Price-sensitive— a price-sensitive person who will always buy the cheapest. Yes, there are price-sensitive people, but what we know from research done by both behavioral economists— economic economists, sorry— and price psychologists is that they estimate the number of price psychology price-sensitive people in society is somewhere between 20% and 30%. So it's not as many as we think. But I'll go further than that. It's not your clients. You see, your clients are not representative of the population of a whole. Your clients are a subset. Your clients are business owners, entrepreneurs, perhaps high-net-worth individuals. And people who are successful business owners, who are entrepreneurs, who are wealthy tax return clients, they cannot get to that position by being price sensitive. And there's some reasons in terms of psychology for that which I won't go into now. So your clients are a subset. They are not the price-sensitive people. And let me just demonstrate that. So think about your client base. Do you have any clients that own a product like this, a product by Apple, whether it's an iPhone, an iPad, a Mac computer, whatever it might well be? Anybody who is an Apple customer by definition cannot be price sensitive because there are cheaper ways of buying phones, tablets, and computers. Think about your clients' coffee buying habits. If before they start work they go into a place like Starbucks, or perhaps it's Peet's or Costa Coffee or one of those other coffee chains, again, any Starbucks customer by definition is not price sensitive because there are cheaper ways of getting your coffee fix. Most people in society are not price sensitive, they are value sensitive. And that's a very different thing. What value sensitive means is that whenever, as a value sensitive person, we buy something, we subconsciously make a little— we look at an equation. I call it the value equation. We look at when we buy something, what's this thing going to give me in terms of the benefit to me? And what's the cost to acquire it or the price? And if the gap between the two is sufficiently big, we will buy. If we perceive a profit on the deal, if we perceive that this iPhone, I think was iPhone 16, €1,300 in Portugal. To me, I bought this because what this will do for me, I see that as being worth more than that. I love the camera, I love photography, and so on. So a value-sensitive person looks at what will it give them versus the price. The price is, yes, it's important, but what's much more important is the size of the gap. It's the size of the gap that determines whether somebody buys or not. So when you've at some point in the past presented a price to somebody, I'm guessing that when you present your prices, sometimes you have had that reaction that we all dread, we all hate, when the client or prospective client says, that's a bit expensive, I can get that somewhere cheaper, that's expensive. Well, when we hear that, that's expensive, we start to assume in our mind that that person must be price sensitive. And when we hear people say that's expensive several times, we extrapolate in our mind and just start to assume that most people are price sensitive. What we must do is recognize why do people say that's expensive? And it's not because you're expensive, because you're not. You're too cheap. I've done surveys of accountants and bookkeepers around the world. We are all charging too little. We're all working crazy long hours, not making enough money because we're not charging enough. It's not because you're expensive. Here's the reason, and this is really important. When somebody sees a price, they will say it's a knee-jerk reaction to say that's a bit expensive, a bit expensive, when they do not understand the value. And this is the big issue. The accounting profession generally, we are pretty poor at communicating, explaining value. And I'm gonna come back to this point because this is so critically important. So your clients are not price sensitive, they are value sensitive. You need to put your prices up, but that means we have to understand what is value. Now, value pricing, I would argue, is more important today than it's ever been. And we talked a bit earlier when Isaac asked me some of the questions, it's largely because of the way that technology's going with AI, the way it's going. We can do things now for a tiny fraction of the time it used to take. I've been sat on ChatGPT all day asking it questions. I've been doing some research, research that would've taken me hours. I'm getting the results just like this, which when we're starting to deliver things like business strategy, tax advice, and so on, we can really significantly reduce the research time using these AI tools. And if we price based on the hour, we'll also reduce our prices. But that's crazy because we can create more value. And we must price based on that value. So value pricing is more important than it ever has been. In fact, I would argue it's essential. Time-based billing, if we cling to that old model, as AI really starts to take hold over the next 2 or 3 years, we will find that many firms who don't change will just disappear. So let's talk about how do we move to value pricing? What are— I'm going to talk about the 3 steps. I'm going to keep it fairly simple because I want to get into part B and do some practical stuff. with AI. But let me take you through what are 3 essential steps. And step number 1 is we have to create more value. That's the value pricing is we price based upon the value that the customer perceives. And so if we want to get better prices, if we want to make more money, we have to create more value. And everything that you do right now, whether it's bookkeeping, tax returns, annual financial statements, there's always more stuff that you can do to create more value. And the way that we do that, the way we figure out what that more value is, is twofold. Number one, we should be asking our clients. You could ask your clients when you see them, you could ask a question: what other problems do you have that we could solve? What else would you like us to— would be valuable to you? When we ask our clients what more we can do, we'll start to collect data and start to get ideas for other things that our clients want us to do. We should be doing that. But also we can do research with technology, with AI, and we'll show you exactly how to do that in just a few minutes. So that's the first thing, we have to create more value. The more value we create, the more valuable we are, the higher prices that we can charge, and the more money that we will make. Also, when we create more value, we differentiate ourselves from our competitors, we will attract the better quality clients. Okay, number 2, and this is really important, customers want choice. Customers want choice. Whenever we buy anything in life, we're all individuals, we want choice. And one of the best ways to do that, one of the most powerful things that we can do is what I call menu pricing. Now, this is something you will have seen, it's becoming very common, but when I started doing this, when I implemented this in 1999, it was the first thing I did in my accounting firm, and it got me over 3 times the price, nearly 4 times the price for a particular service. What am I talking about? I'm talking about very simply offering people a choice of different packages. Think of it, if you like, as the bronze, silver, gold. It's now common, you know, pretty much every SaaS company does this. All the most successful companies on the planet do this. Apple, you go to their website right now to buy an iMac computer, they will give you a choice of 3 options. You go to buy a coffee in Starbucks, you want a latte, they will give you 3 choices, the tall, the medium, and the, the venti. This is, and this is done because it's extremely powerful. And so what you must do is for every service you offer, whether it's tax returns, bookkeeping, whether it's annual financial statements, cash flow forecasting, you should always give clients choice. Give them options. Why? Because number one, they want choice. Customers want choices. But also, and this is even more important, is It helps us determine what people value. So here's one of the things that— this is why value pricing people sometimes struggle with. What makes it hard is that value is subjective. Value, as my friend Ron Baker says, is in the hearts and minds of customers. Everybody values things differently, and because it's subjective, we don't like that. We like timesheets and measuring hours because that's objective. We feel like it's accurate. The problem with value pricing is it's subjective, and only the customer can determine what value is. But just because it's difficult doesn't mean we should not attempt to try and identify value, and one of the ways to do that is to give them choice. Let me give you a quick example. Let's imagine you're selling a tax return. You've got somebody coming in to buy a tax return from you. If you say to them, we can do your tax return and we'll do it for $750, I can tell you with absolute certainty that is absolutely guaranteed the wrong price. $750 is the wrong price. Why? Because when that customer comes in, at the back of their mind is they have some sort of number. They perhaps can't articulate it, but there is a number which is the maximum they are willing to pay. And the probability that that number is exactly $750, that you've got it on the nail, is so unlikely it's pretty much impossible. They will have a number in mind, and that number of how much they value your tax return service is going to be either higher or lower. If it's lower, if you're explaining your tax return service and they're thinking, ah, this is pretty cool, this has got to be worth $500, and they say, what's the price? You say $750. They say, oh, that's way too expensive, I'm going somewhere else. You lose out, and that's bad. But even worse, what if they come in and they're thinking as you do your presentation, Wow, this is amazing. I've had so much hassle from the tax authorities. I hate pulling together the information. This is going to make my life so much easier. This has got to be worth 1,000 to 1,500 to get this sorted. What's it going to cost? And you say 750. They say, great, let's get started. And you think, wow, yes, I'm a great salesperson. No, you've just left money on the table. You just thrown away 250 to 750 hundred. Bucks because you went in too low, which is what we do over and over again. We give a price which is a price that we hope they'll say yes to, which very often is way too low, which is why we find ourselves with low margins, working crazy hours, not making enough money. So what we have to do is figure out how do we identify their maximum willingness to pay? How do we know that that particular client might be willing to pay $1,000 or $1,500? We do that by presenting choices. We might say to them, I've got 3— there's 3 things that we could— 3 types of tax return we could do for you. Here's our $1,500 version, here's our $750 version, here's our $500. And when you say, here's the $1,500 per person, if they see value in that, they will say, that's exactly what I want. And you never even have to talk about the $750 version. They will self-select. They will tell you what they value because you've given them choices. This is so, so powerful. You should always give people different options, different choices. There are several ways to do this, but the simplest is just menu pricing. Present them with, if you like, a bronze, silver, gold. And I know sometimes people find that difficult to figure out what should they put in those packages. And there is a real science to menu pricing, by the way, although it's seemingly simple and extremely powerful, there's a science and an art to it. But the good news is we can use AI to help us create our packages. By the way, the reason it's so powerful is because there's a lot of psychology in presenting different people with choices. And if we look at what Apple do, for example, what they do on their pages here are just genius. They understand this. And one of the key things to understand is that when anybody, that's you and I, when we are faced with 3 choices of something to buy, Most people will gravitate towards the middle option. Typically, it's about 60% of people. If you get your pricing structure right, it's about 60%. Why is that? Because we know from behavioral economics that we are risk-averse, and what that means is we don't like risk. And when we're faced with 3 options, for many people, they look at the cheapest one and think, that might not quite solve our problem, that might not quite give us exactly what we need. They look at the most expensive one and say, if we buy that one, that might be— we may be paying a little bit more than we need to. The middle one feels about right. So many people go for the middle one. And when we understand that, we can start arranging our packages and pricing our packages in a way that gets people to start paying us more money by giving them choice. First time I did implement this in 1999 with one of my tax planning services, Over the next 2 years, I measured it. I got almost 4 times the price and no pushback on the price because I had a different way of presenting them. I gave them choices. So let's move on to the third step. So we've talked about we need to create more value and we need to give them choices, and that's the starting point. The next thing we need to do, we've kind of touched on. Remember I said to you, your clients are value sensitive, not price sensitive, and when customers say that's too expensive when they see their price, that's because they don't understand the value. So what we must do is get better at communicating value. We need to use the right words, the right language, so that people understand the benefit of what we do. And I would argue that when we look at the whole area of value pricing, The most important part of value pricing is the communication of the value. It's not the coming up with the price, it's the words we use, it's how we communicate value. When you say to somebody, if you're talking about bookkeeping, and they say— and you say, one of the things we'll do with part of your bookkeeping is we will reconcile your bank account every week, I can guarantee you've never ever had anybody ever say, wow, that's amazing, I've always wanted someone to reconcile my bank account. And they won't say that because they don't understand the value. Now, you and I know that's a critical process. Reconciling a bank account is critical, and there are so many benefits to that to the customer, but we never tell them, we never articulate it. Now, if you want to know the exact script to use, then come along to my conference in a few weeks' time on how to price bookkeeping, because I'll tell you exactly how we script that, the words we say to build up the value of bookkeeping work. But what I want to do now is I want to get to part B. I want to get practical and show you how we can do some of this stuff using AI. And of those 3 steps that we've just looked at, I'm gonna look at step 1 and step 2. So let me go across to, let me go across to ChatGPT, which is here. I'm gonna assume that you are familiar with ChatGPT. I'm, we can We can deal with questions later, but this is ChatGPT. If you've never been here before, on the left-hand side, we can see the history of our chats. We can also, if you've got a Pro, a Plus account or Teams account, you've also got projects. You've got, you've got GPTs, which are all extraordinary things. But what I'm gonna do, let me just close this down. I'm gonna just, I'm gonna show you some power stuff, powerful stuff we can do with pricing with just the free account. Because the free account has access to ChatGPT 4.0. It's a great model. Yes, there are other models we can use, but for most things, 4.0 is sufficient. So what I'm going to do is I'm going to do a couple of different prompts. We're going to look at how to create more value, and we're going to look at how to create different packages and do it really quick and simple. Before I do that though, I need to— what I'm going to do is also refer to this. This is a prompt library. One of the things I strongly recommend you do is Think about all the common tasks you might do in your firm where ChatGPT or your large language model of choice can help you. And then anything that you might do more than once, anything you might do frequently, then create a library of prompts. This is one that I create for members of the Value Pricing Academy. I've written over 100 prompts specifically for the accounting profession covering areas like ideation and learning, marketing prompts, content creation, how to write an ebook with a series of prompts, of course pricing, uh, uh, business advisory, financial data analysis, text analysis, client communication, systems and processes. These are all things that you can use ChatGPT for and save hours of time. We're going to look at pricing, and I'm going to look at 2 particular prompts. I'm going to look at service— one called service designer first. By the way, what I'm— what you're seeing here is a prompt library. I, I'm a big fan of Trello. I love Trello. I think it's a great way of organizing prompts. And the nice thing about Trello is that you can get a free account. You could build a prompt library with a free account of Trello. I know some people love Notion. Notion's a great way. It's a database effectively of prompts. You could put prompts in Airtable, which is another database platform, or you could just create Word documents, for example, for each prompt. I happen to like Trello. There's a couple of neat things that you can do with Trello when it comes to prompts, and you'll see that as we go through them. And I'm visual. I like the visual side. I know that if I want a pricing prompt, I just go to the column that says pricing, and I can then see all the pricing prompts. You can see there's a lot of prompts here. Okay, so let's look at service designer. Let me just click on it, and in there we'll see the prompt. I'm going to hit the edit button because it's going to pull out the prompt, and you'll see it's a long prompt. Now, please don't let that scare you. Okay, one of the things I teach is prompt engineering. The more specific your prompts are, the better the result that you will get, the more consistent the result, the more consistent the output. And so there's certain things, elements that build, that make a great prompt, and I'll explain some of those to you. As we go through them, I'll explain the prompt and then we'll look at what it does. So we're going to use one to design a service. So let's imagine you want to build a brand new service and you want to add value. You want to figure out what you're going to do for it and you're just not quite sure. And let's use as an example, let's imagine that you have quite a few clients you've been talking to and they say to you that they're having real problems with debt right now because of perhaps the cost of living crisis and and so on. They're struggling with debt, and you're thinking to yourself, I could do a little advisory service where I help my clients get out of debt and build wealth. That would be a great way to add value to clients. But the question then becomes, okay, so how do I add value? What would I do as part of a service of helping a client get out of debt and build wealth? Well, let's see what ChatGPT does. So I'm in my— I've got my prompt. And I'm just going to hit the View Markdown button. If Isaac, you want me to explain that later, we can talk about Markdown. I know you're thinking about questions, but let me— the reason I do that is partly because you get a nice little copy button. So I've copied this prompt straight to my clipboard, and I now just go across to ChatGPT, and I simply go into Message ChatGPT. I start a brand new chat, I do Ctrl+V, and there is the prompt. And I could pretty much run it straight away, but there's a couple of things we have to do. I'm going to explain some of this prompt, but I'm going to go to the end quickly. I'm going to go to the end, and the reason for that is that what I do is this prompt library. I'm a big fan of creating prompt templates. I'm a big fan of systems. I love the Michael Gerber message, and as accounting professionals, we are typically very good with systematic thinking. We have systems like audit checklists, tax return preparation checklists. Doing a bank reconciliation is basically a system. We love systems. We are good at systems or SOPs if you prefer that terminology. We are good at systems. And what a prompt template is, all those prompts on the library, each of these prompts like this one, it's just a system. This is a system to help us design a service really, really quickly. But we want to make sure that every time we run this prompt, it's going to differ for different things. So what I build into these template prompts is variables. This is so powerful. Variables, and it's really simple. Please don't get con— don't think you have to be a programmer to do this. Variables is really, really simple. I have at the end of all my prompts the variable. So all you have to do is change some things at the end, but the rest of the prompt is the same every time you run it for every client, for every service, for everything. We just have to change the variables. And so what I'm going to do here is I'm going to— there's 2 variables. What's your business? So I'm going to stick with small accounting firm. And what's the service that you're going to do? So we've got business. I'm doing this for a small accounting firm, and we'll go with this: help a client get out of debt and build wealth. If I wanted to build a service for cash flow forecasting, I could just reword this as help clients to sort out their cash flow forecasts, whatever it might well be. That's the only thing I need to change in this prompt because the rest of it is the same every time I run it. So let's just go back and explain a few things because I want to take away this fear that the length of it, it's actually not that difficult. So it starts off by saying, you are a product manager specializing in service design with expertise in customer-centric product development and feature prioritization. Why that? Because we know from studying prompt engineering that Large language models will give you a better result if you give them a specific role to play rather than its default, which is a helpful assistant. So I always, in every prompt, will give it a role. If I want ChatGPT to analyze financial statements, a profit and loss account, and do a report for me, I will ask it to play the role of a financial accountant skilled in analyzing financial data, because what I'll get back as a response will be the sort of response you would expect from a financial accountant. So a role is very important. We learn this in prompt engineering. Then we have our task. Your task is to design a service offering for a business type, that service outcome. Okay? Now there's your variables. Okay? Or ChatGPT knows because I put business type there and service outcome, it knows to insert what we put at the end. So it'll read that as your task is to design a service offering for a small accounting firm that helps a client get out of debt and build wealth, which therefore means every time in the prompt I want to refer to and remind it of the service or my firm type, I just put the variable in there because I only have to change it once at the end. That's what I mean by variables. Okay, so provide detailed features and things the business type can do as part of this new service offering. That's the task. And then what I've done is I've asked it to format in a particular way. And this links into a little bit about the value communication. I wanted to say not just what the feature is that we'll do, but what the benefit of that is. And I've put an example there. Like, I've given an example. Examples are really powerful. It helps ChatGPT to give you the right, a better response if you give it an example. And then what I've done is, as it says here, use the example. To guide your response. I'll come on to that in a second. I've got a few instructions about outcome, and then I've got a heading called Examples. And this is what makes it a long prompt. In the prompt, I've given it a number of examples of what I'm expecting it to do. I think it's 2 examples in this— no, 3 examples. There are 3 examples of what I wanted to do. Why do I build examples into prompts? Because one of the things we learned about prompt engineering is that Large language models like ChatGPT are not intelligent. They simply predict the next word. They look for patterns. And so when you give examples as part of your prompt, it can see the patterns in your examples, and it will therefore give an answer, a response that follows those patterns. In other words, will give you exactly what you're looking for. So let's hit the black button. Let's send this response. And while it's— whilst it's doing this, you can see it's crazy fast. I know I've talked a lot, but if you think about the time it would take to do this, all I did was I went to my prompt. Let me just close this down for a second. I went to my prompt, I copied it to my clipboard, I pasted it into ChatGPT, and then I answered 2 variables, and then I hit response. And all of this you could probably do in less than 2 minutes, perhaps even less than 60 seconds. And in less than 60 seconds, we have our answer. So here's what it's suggesting. If we're offering helping clients get out of debt, it's suggesting what we could do is a financial health assessment, and it's describing what that would be. We could do a debt prioritizing— prioritization plan. We could do cash flow optimization. We could negotiate with creditors. I'm not saying you would want to do that. It's giving you ideas of what you might build into a service to help clients with their debt problem. We might help with automated debt repayment strategies. Perhaps building an emergency fund, and all these things are described here as to what it means. We could we can have a wealth building investment strategy for our clients, tax efficiency planning, financial education, regular progress reviews, and so this is a great starting point to design this brand new service. Here's some great things that we could do. Now this is a starting point. You might decide you don't want to do some of those things. It may be you come up with some other ideas, and the great thing about ChatGPT is if you think there's not enough, you could always say give me three more ideas. You can always then start to have a conversation with it to expand on that. But let's assume that you're happy with that. You think, yeah, that's a pretty good list of things that I could do to build a service and add more value. And of course, you could run this prompt with your existing services like bookkeeping, tax returns to get some ideas of the sorts of things, other things that you might be able to do to create more value, which is, as I said, the first of our 3 steps. We want to create more value. Here's a prompt that can help you do it. in just seconds. Okay, customers want choice, so now what we want to do is, having decided what we're going to do as part of our service, let's create our different packages, our bronze, silver, gold, if you like, and this is something that I know firms really struggle with sometimes, as to what to put in different packages, and as I said earlier, there's a science, there's an art to this, there are some things that we need to do, like understanding different types of customers, customers' personas, we want to build packages that speak to particular clients' types of needs, I'm not going to go into that, go into that today because we are, we only have about 10 minutes or so. But what I will do is we'll show you how to do it with a prompt. So let me just go back to here and I'm now going to go to, what prompt shall I use? I'm going to go to one called package builder. I'll use this one. Sometimes I've got some different versions of prompts, some are more detailed than others. So we're going to build our packages now. So I'm going to hit the edit button.

Why?

Just because in Trello, one of the things with Trello is you can grab the markdown version of that and put it in your copy and copy to your clipboard. It just saves some time as part of the workflow. So I've got that in my clipboard. I go back to ChatGPT and I'm going to, I'm going to do this as the same chat because I'm going to keep, because I'm going to be building on this, on this. Helping clients get out of debt and build wealth. So I'm gonna hit Ctrl+V once again. It's, it's a long chat, as you can see. I will go straight to the end because at the end is the variables, and in this case there are 4 variables. And what I'm just going to do is— just bear with me a second— I've already— I'm gonna copy it, save you watching me type. I'll actually put the answer to these 4 variables and then I'll explain them to you So we've got features, service outcome, business type, number of tiers. Let me just do Ctrl+V. So what are the variables? Well, the first one is how many tiers, how many packages do you want to build? And I always suggest to people who are new to menu pricing, start with 3. It's the magic of 3. I touched on it earlier. People often gravitate towards the middle one. Let's build 3 options. But with this prompt, if you wanted, you could have 4 options or 5 options or 2 options. It's up to you. It's a variable. Now the business type is the same, small accounting firm, and the outcome is helps clients get out of debt and build wealth. The reason it's got those variables in again is because I designed this particular prompt to use as a standalone prompt for an existing service. So in this case, we've actually built the service in the first prompt, and so it already knows we're a small accounting firm, and it knows that. It's just the fact that I put these variables again in this prompt because you could run this standalone for something else, for an existing service. Service, for example, where you then list. So you could run this for your bookkeeping service, which you've already got, and then just list all the things you currently do. In this case, the features are the list in your previous response. So there you go. That's the variables in this one. And I'm just gonna go very quickly and tell you about some of the prompt. This time, it's a different role. Now I want ChatGPT to play a different role. It's not a product designer anymore. I want ChatGPT to play the role of a pricing consultant specializing in value-based pricing with expertise in tiered pricing structures. Okay? Because we're, we're now creating different options, and I want ChatGPT to be— play the role of someone who's expert in that. I'm gonna give you a list of— a detailed list of features, which is one of the variables, for a service that helps clients get out of debt. Your task is to allocate those features to specific tiers. The specific offering will consist of 3 packages. So that's a variable. We could have done 4 or 5, and you can always rerun the prompt and change the variable. And then I've given it, in this case, specific steps to go through. I want it to first of all identify a likely customer avatar for each of the 3 packages and their most likely outcome from the package. And I'll give some examples: a price buyer, standard buyer, premium buyer. This is This is part of the science of doing menu pricing. I don't want to— we've run out of time for that today, but that's what I've built into the prompt. I've built in some of my things I teach into the prompt to get better results. Once it's understood and come up with 3 possible buyers, it then creates the 3 tiers by allocating the features to those. And I wanted to use the template to guide the response because templates are like examples. It helps to give some some guardrails over what we're looking for, some specificity. We want a particular type of report, and we don't want to make up the answer, the format of the answer. I wanted to make sure every time I use this, I've got some consistency in the output. So I have a template here, and this is just simply setting out how I want it to set to give me the answer. That's all that is. That's why it's a long prompt, and I think I may even have examples as well. Yeah, there's examples there. So I give ChatGPT in my standard prompts both templates and examples to follow to get the exact formatting and structure of the result I want to create that consistency. Okay, let's do it. Let's see what it does. And then I've got a few free gifts to give you, and then it may be that Isaac's got some questions for me. So here we go. It's off. So it's telling us packages for a service that helps clients get out of debt and build wealth. So it's telling us firstly that there's 3 possible customer avatars. So it may be that we have our package 1 is aimed at the price-sensitive client who needs fundamental debt management services but have limited budgets. Okay, they're not really price-sensitive, but they have a limited budget, and their outcome is to reduce debt in a structured way. Important factors are affordability, essential features, and simplicity. So this, this is just making sure we're clear who is the sort of person that might buy the entry-level package, because we want to build a package that meets the needs of these sorts of people. And let me go on to number 3. Premium 1 is clients seeking premium high-touch service with deep financial coaching and accelerated wealth building. Their desired outcome is to achieve financial freedom or quickly and transition into wealth accumulation with expert guidance. Important factors are comprehensive strategy, premium support, access to wealth-building insights. So when you're designing your packages, you would read that and you would then think, does that sound right? Are they the sorts of characteristics of 3 types of buyers? If they are, great. If not, you might want to tweak that a bit. But assuming you're happy with those, it then builds the packages based on that. So based on the needs of the essential buyer, it's suggesting we should have a description. This package is designed for price-conscious clients who need fundamental support to manage and reduce their debts effectively. It provides essential tools and guidance for debt repayment without extra features. And then it's suggesting that what we might do as part of that service is a financial health assessment, debt prioritization, cash flow optimization, automated debt strategy and repayment strategies, and access to online financial management tools. Number 2, this package is for clients who want a balance between affordability and additional features that not only reduce debt but also begin layering the foundation for financial stability. And that's going to include all the features from Essential plus these extra things here. And then finally, we've got this package is for clients who want a comprehensive, high-touch service that not only helps them eliminate debt but also accelerates wealth accumulation through strategic financial planning, and then we've got some extra things there. And so you've now got your 3 packages. Yes, you might want to change a bit, you might think, I don't want to actually do that service there, you could take things back out, but you've got a great start to building your packages. And not only that, although we've not covered specifically step 3, which is the communication, a lot of the wording from this particular prompt does some great wording here. So this description here you could put on your website, you could, you could have on your website about your debt, helping people pay off their debts, and you could say we give 3 choices, and then you could use these 3 descriptions, and they're pretty good descriptions. And then when you build your, your brochures and your systems to communicate the different packages, you— this is a great starting point for how you might communicate the value of each of the things that you do. Now we can go deeper on that. I have other prompts that then start to build on the language and, and the communication, but these 2 prompts alone are really, really quick. And if we think about the process for a second, how long it's taken, let's imagine that you want to launch a brand new service like helping a client get out of debt and build wealth. Then with these 2 prompts, within less than 5 minutes, you've got a feature list and it's then put it into 3 different packages for you. Yes, you might change it if you want to, But 5 minutes to get your menu pricing for a brand new service sorted. I know some people spend 2 or 3 hours scratching their heads over this and trying to figure out what they should be doing. Okay, that's ChatGPT and how we can use that with pricing. I hope that that's been valuable. What we've talked about so far, just by way of recap, is the single biggest myth, if you remember, is your clients are not price sensitive. They are value sensitive, and what that means is we must put our prices up, but we must be better at communicating value. We've talked about those 3 steps: we have to create more value, we have to give people choice because then we can start to understand what is their maximum willingness to pay, and we've also then talked about a little bit about how the words you use, the communication, is so important. They are 3 critical steps of value pricing, and with all of those, we can use AI to help us do that. So we've looked at this concept of having a prompt library, which are basically our systems for doing stuff, and we've looked at a couple of those for creating a service, for adding value, and for creating those packages. Now I do have some gifts for you. So one of those is I did create a workbook to go with this, which includes a summary of what we've talked about, but also includes those 2 prompts, because I know people will want to have access to those prompts. They're in the workbook. So that will be— I'm not sure how Isaac will make that available, but it'll probably be somewhere in the description. And then some other things that I've got for you is 3 other things. I mentioned that we are about to run the Profitable Bookkeeping Conference and we are giving away some completely free tickets. So if you want to go deeper on this, I'll be going— well, over 3 days we'll be looking at how to apply value pricing to bookkeeping, and there will be some more deep AI stuff in that as well. If you want to learn more about ChatGPT, then I have an ebook I wrote called ChatGPT for Accountants and Bookkeepers. And if you would like a copy of that, I believe the link has been put in the description below YouTube. Or if you use your smartphone, there's a QR code on the screen right now. Just tell me where to send that to you and you'll find in there, if you're new to ChatGPT, it's a great introduction. And there's also a whole bunch of other prompts that will give you some inspiration of things that you can do with it in your accounting firm. And then last but not least, I have another ebook for you that I wrote a little while back on how to price bookkeeping. So I talked through the 5 key steps for pricing bookkeeping services. So if you offer bookkeeping and you, and you thought today was a good introduction, you want to start value pricing that service, then grab this ebook, let me know where to send it to. And if you are able to come to our conference, even better still. Right, I believe we might have about 10 minutes left or so. I will bring back Isaac if he's here. I think he's going to ask some questions.

Great presentation, Mark. I really liked it.

Thank you.

I would like to say, like, you think like an engineer, like very systems-oriented of like introducing variables into prompts. So I really like that particular piece of like thinking in steps and variables. Now, putting myself on the accountant's shoes and what they might ask, if anyone here is live and wants to ask any questions, this is your time, so feel free to do that. But something that I've noticed personally, some people know how to do it, right? They have the information, but for one reason or another, they choose not to take the next steps and not follow through, maybe not they have that idea of the packages, it becomes a spreadsheet or a document that they never present to clients. What are your thoughts on some of like the reasons people don't do it even if they know how and how to overcome that?

That's an interesting question, Isaac. I think there's a number of reasons. I think part of the reason for not implementing is time. Most accountants, bookkeepers are overworked, too busy, react— being very reactive, reacting to client phone calls, client emails. And so they know they need to do this stuff, they need to put this stuff in place, but the client work gets in the way. And that's a big challenge. And the solution to that is— well, there's several solutions, but the one that I often say is the reason why you are currently overworked and don't have the time to do the important stuff like putting systems in place is because you're too cheap. If you're too cheap, you are having to work extra hard just to, just to generate the fees to get by. And one of the things that I have always said is you should put your prices up with your existing clients. And, and I always say, think of it like this: if you put your price up by 20% on average across your client base— and I've done this and it, it happens every time— If you put your price up by 20% on average across your client base, some clients might leave. Some clients might leave. It's actually almost nobody leaves, and there's a reason for that. There's a stickiness in our profession because of the personal relationships. But let's just imagine, and in 25 years of doing this myself and teaching other accountants, it's never happened, but let's imagine 20% left. Okay, you put your price up by 20% on average, 20% leave. Well, if you do the math, first of all, the impact on your revenue and profits is almost zero because the 20% less customers is made up by the 20% extra fee increase. Actually, if you do the math, I believe if you've got $100 grand of fees, you'll end up with $96 grand of fees. There's a small difference, but, but so your, your results don't change. But what does change if you suddenly have overnight 20% less clients, you just freed up one day a week. You're now working 4 days a week, which means you've got an extra day a week to start putting other stuff in place like the system. So I think time is certainly one of them. And I'd say the second one, Isaac, is probably fear.

Yeah.

People want to start pricing in a different way, pricing value pricing, and they worry what the reaction might be from the clients, and they worry about losing clients. Well, we shouldn't worry about losing clients because, A, we need to. We've got too many clients. We want some to go. Unfortunately, they very often don't, but we do want clients to go. And so we're not going to get— we fear the worst-case scenario. We fear that if we start to change the way we price, all our clients will object and they'll all go. No, they won't. And secondly, clients actually want value pricing. Clients want more. Not all clients, but the right clients, they want you to do more stuff. The right clients want you to help them reduce their debt and build their wealth. The right clients want you to help them put in systems and processes to automate their financial systems, to do the sorts of things that you teach. The right clients want all that automation stuff, and— but we're too busy to do it because we've got too many of the wrong clients because we're too cheap. And when we're too cheap, the problem is when we're too cheap, we tend to attract a certain type of client— the people that want the cheap bookkeeper and the cheap accountant. And we have to break out of that cycle.

Yeah, definitely. And I think one of the things is it really changes the, the client relationship, right? Like, it, it goes from transactional to much more relational when you have that, that kind of relationship where they feel you're an advisor, not just like an order taker, so to speak.

Yeah, that's, that's such a good point. I was, um, back in about 2006, 2007, I, when I was in the UK, I was doing a an event, a conference. It was called the Million Pound Summit event, and basically we got, I think it was 4 or 5 accounting firms who were collectively making a million in profit. And I was on the stage as a facilitator, spent the whole day asking questions to see what it was that those firms are doing different that's getting such good results. And it was fascinating that even though some were small sole practitioners, some were multi-partner firms, They all had so many things in common, and the one that really stood out for me was this: that there was one particular sole practitioner firm. He had client managers, and he said that in his firm each client manager is only allowed to have a maximum of 20 clients. Now, when I ask most accounting firm owners how many clients they deal with, accountants will often say, "Well, I have 200 clients," and they're proud of that. That's crazy. This this firm. each person had a maximum of 20. And so I said, well, why 20? Why so few? And he said, because when you have 20 or less clients, you have the time every single month just to pick up the phone at random or drive past and go and say, hi, hi John, I was just thinking of you, how's it going? And he said, you know, clients love that when you just ask them how things are going. And he also said, what's interesting is that And he said it was a third of the time. He said very often what happened was when that call was made, the client would say, do you know what, I was just— I'm so pleased you've called me actually, because I was just thinking about this issue, and they talked something through, and very often it ended up with the opportunity to do another service, to do something more valuable and solve another problem, and so they got more work because they spent more time with their existing clients.

Yeah.

And so I've said for years that one of the biggest things that holds us back in the profession is we have too many clients. Any accounting firm, if a sole practitioner has 200 clients, how can you possibly build relationships with 200 clients? It's, it's, it's impossible.

Well, we have a couple of clients or firms we've worked with that have like 1,500, as an example. But of course, at that point, it's, it's really more about, you know, doing a lot of personal returns, as an example, or Very small SMBs where, you know, sometimes the, um, there's just kind of like not enough time that we'll have to allocate to them. They have to find ways just to deliver the thing and that's it.

Yeah, so then you have to be really good on your automations, your systems, your process have to be so good, uh, to do that. But you still need to, I believe enough in this AI world that we're moving into that I think that One of the implications of that is that human connections are gonna become more and more important in the future. People are gonna crave human connections the more that AIs do automating stuff. So automation, I love AI, I love automations, but we have to also figure out how we're gonna keep those connections, those relationships.

Yeah. Yeah.

Definitely.

I have one last question for you because it's a, I think it's always a hot topic. It's just a topic of time tracking and timesheets. In the context of not necessarily a firm that— maybe a firm that's already adopted value pricing, right? They're not billing by the hour anymore, but some of them, with good arguments or sometimes not, choose to still track time as a way to make sure that, you know, clients are not being overserviced and other things. I understand both arguments personally. I'll be curious to hear your thoughts and kind of if you're Can I strongly opinionate in one way or the other?

Yeah, well, I'm very clear on it, as is my friend Ron Baker. There is no place in the profession whatsoever for timesheets. And I speak from— I speak on that from the perspective of a sole practitioner that grew up with timesheets in my accounting firm way, way back, and then I did get rid of them. And so I've experienced the with and the without. And if I was to ever start an accounting firm again, which I wouldn't because I love teaching, but if I did, I absolutely would not have timesheets because they don't help at all. There's a couple of key things. The reason why people still keep them if they think they're value pricing is because they feel they need to measure things, but they're not measuring the right things. The things these people say is, I need to see if my team are productive. Well, we shouldn't— it's not about productive, it's more about how effective they are, and we shouldn't need to micromanage our team. We have knowledge workers, we should trust them more, and so there are other ways to measure that. There are other measures that we can put in place that measure the results they are getting, the outputs, rather than the time that they are putting in. We are measuring the wrong things. I would rather have an employee, a team member, Uh, rather than doing 40 hours a week, uh, doing something, uh, productive— time, tax returns or whatever— I'd be happier if that, if that person spent, spent 30 hours a week just thinking and researching and putting nothing on a timesheet, and then they come up with this amazing idea. They then go and talk to one of the clients. They, they found a way to save them 100 grand in tax. And they end up billing that client more than the other person who just put in the hours doing the time on the timesheet to do the tax return. I would rather somebody who just thinks more, because we're in, we're in the knowledge industry. We shouldn't be rewarding hours that we put in. We should be rewarding the outputs, which is— the outcomes is based on the value we create. And we create more value when we think differently, when we think about our clients at a deeper level. So that's the first thing. And the second point is The— when we— when people say they are value pricing and they're keeping timesheets, I don't believe that. Because what happens is whenever you have something a bit out of the ordinary, some special work or something that you don't know how to price, when you have timesheets, you revert back to either consciously or subconsciously to thinking about hours. When you have got no timesheets, you have no alternative but to think creatively about value pricing. And when you think creatively about value pricing, you will always get a better result. You'll come up with some way of pricing a project much more creatively when you can't fall back on the hours. So I don't think there's any place for timesheets whatsoever. But we do need to think of different metrics. We still need to measure things, but we just have to measure the right things.

Yeah, definitely. And actually, one of my, I guess, predictions for the next few decades. I think over the last several decades we've talked a lot about value pricing from the perspective of how we bill clients, can incentivize efficient internally. But I think one of the things we've started to see some clients do this, and I think it's going to become more and more a thing, it's actually production-based pay for your employees. So that the more they do, the more revenue they bring, the more revenue they manage, the more they make, which I think hasn't been as common of a thing, but hopefully will become become the norm, hopefully, over the next several decades.

Hopefully, yes.

Yeah, yeah, perfect. Well, we're out of time now. We have an hour, so thanks for coming, Mark. Um, as you mentioned, in the YouTube description you will see some of those links. I believe one might be missing, one of the PDFs, so if you want to send that through via email, I'll make sure to edit that and put that there. And Thanks you all for joining in. Have a nice one, Mark. Take care.

Thank you. All right, bye-bye.