Nicolas Cole explains why charging low prices can cost you deals with bigger clients. When companies spend millions on advertising, a $7,000-$10,000 monthly fee signals expertise, while $1,000-$2,000 makes them suspicious you're hiding something. Price is a quality signal.
When you're dealing with bigger companies, price point says a lot. A really good metaphor is if I went to you and I was like, I got a sweet deal, I got a Ferrari that I'm willing to sell you for $800. It's a scam for sure. And so when you're dealing with mid-tier to upper-tier size businesses, like these people are spending hundreds of thousands, if not millions of dollars just on Facebook ads a month. The concept of charging like $2,000 for a service relative to all the other things that they spend money on, you have to realize that the price point actually says a lot about you. And there's a perception difference between saying I charge $2,000 a month versus I charge $7,000 a month or $10,000 a month. And a lot of times it's almost like when you're pitching larger clients, charging more makes it easier because the price point implies you must be really great. Whereas the lower the price point, the more that they're like, why is this guy only charging me $1,000 a month? There must be some catch here.
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