In a market downturn, there is always pressure to cut your prices. Trouble is, the same pressure applies in an up market, too!

Can you ever win? Either the client won’t pay what you’re worth because of tight budget constraints, or so many competitors enter a flush market that there isn’t enough money to go around.

Here are some ideas on how to achieve premium pricing for your PPC services.

1. Focus On Sales

As we discussed in a previous post, What Is The Key Skill Of The PPC Consultant, apart from search marketing expertise sales is the most important skills an independent PPC consultant can possess. Without sales, nothing else can happen.

How do you generate sales leads? How many leads do you have right now?

If you have few leads, then you need to put a lot more effort into sales, and think about increasing the channels by which you market i.e. PPC, conferences, cold-calling, agency partnerships etc.

You should always strive to generate far more leads than you ever use. This way, you’ll have your choice of clients, and won’t feel under pressure to cut your prices. Of course, this is easier said than done, but the important thing to think about is how much effort and resources you currently devote to the sales side of your business.

If you’re a sole operator, you may not have much time to devote to sales. One way around this problem is to partner with marketing and advertising agencies. Small agencies may not have enough work to be able to hire a dedicated search marketing specialist, but would certainly like to offer such services. If you sign up three of four such agencies, they’ll do much of the selling for you – typically to their existing customer base – and take a commission on your work. This commission usually works out to be way cheaper than hiring dedicated sales staff yourself.

2. Make Your Client Money

If I said to you “For every dollar you spend on my services, you’ll make three“, would you hire me? How about if I said “For every dollar you spend on my services, you’ll save three” would you hire me?

Of course.

ROI – return on investment – is a very powerful sales tool. In your proposal and pitch, demonstrate exactly how you will provide ROI. For example, you might approach businesses who market only on radio and demonstrate how PPC can generate more leads/visitors/responses for the same spend.

No business will turn down a positive ROI proposition, no matter what the state of the economic climate. The economic climate is actually in your favour at the moment – money is moving out of traditional media channels, such as television, newspapers and radio, and onto the web. This is soely due to the positive ROI proposition offering by internet marketing.

3. Carve Your Own Niche

Are there too many generalist PPC consultants?

How about owning a niche, such as travel, construction, clothing, retailing etc?

Look for businesses in niches that predominately use traditional marketing channels to advertise their goods and services and construct proposals that compare the ROI of PPC vs these traditional marketing channels.

The niche needs to be big enough for you to make money, but small enough to have escaped the attention of bigger marketing agencies. Big agencies with high overheads often avoid small niches because they are too small for them to service and still make a profit. Such niches provide rich pickings for the independent consultant who typically has lower overheads and can adapt quickly.

4. Become “The” Guru Of Your Niche

People like dealing with people they perceive as being notable experts. If you’re already known to your potential clients, or can point to independent validation of your guru status, then you have a massive advantage over unknown consultants.

This is also a reason why focusing on a niche can be such a great strategy for the independent PPC consultant. The world is awash with PPC gurus who have been plying their trade for a long time, speaking at conferences, writing articles for major publications etc. Instead of competing with them directly, choose a niche and become a superstar in that niche. There will be many trade publications that have NEVER had a PPC consultant write an article for them.

Why don’t you become the first?

5. Provide More Value Than The Next Guy

Always be on the lookout for areas where you can add more value than what the client pays you to provide.

For example, say you have an interest in usability. You note that the client has a few usability problems that could be easily solved. Write up a detailed report and give it to the client as a bonus. View the time spent on this report as a marketing cost i.e. you’re trying to forge a deeper relationship that will lead to ongoing business.

Clients will never fail to be impressed by value-added services.

Under promise and over deliver.

If you’re great at PPC, then why would you sell those skills to others? Why wouldn’t you become an affiliate marketer, or set up your own site selling goods and services? What’s the point of working for a string of new bosses as an independent PPC consultant?

There are a few reasons why becoming an independent consultant can be a great idea. Lucrative, too.

1. You Get To See Deep Inside Other Businesses

Market research – good market research – can cost a fortune, but the consultant gains an intimate knowledge of their clients market. Not only do you get to see the data, you get to see the marketing and business processes that you can then apply elsewhere. Not so much spying as a valuable apprenticeship and research opportunity, for which you get paid.

2. Flexibility

The independent consultant gets to choose their own hours and projects. Unlike an employee, the independent consultant can choose their “bosses”. Don’t like the boss? “Fire” the client.

You can also choose your hours of work, when to take holidays, and where you work.

3. Focus On Core Skills

Crafting solutions can be a lot more fun than implementing them. Delivering goods or services can be a hassle, and require a lot of back-end processes.

PPC is mostly a high level marketing function, and the responsibility typically ends once the visitor moves to desired action.

The Big Problem With Consultancy

The world is chock full of PPC consultants!

Anyone can call themselves a consultant, so many people do. Assuming the consultant can do the work to a high standard, the most critical skill of the independent consultant – entering a saturated market with no barrier to entry – is the ability to sell.

How do you sell your services?

1. Identify Your Client

Do you want to work with big organisations or small? The approach you take will differ depending on your target market.

Small businesses tend to like dealing with other small businesses, as they appreciate the direct level of contact. Big business have larger budgets, but can be harder for the new consultant to engage – many large firms will work with preferred suppliers, and with established agencies.

Tailor your pitch and approach accordingly.

2. Craft A Point Of Difference

Why would they choose you? You may be great at what you do, but how do you convince others of your worth?

Points of difference can include:

• Geographic locality i.e. you can go and see clients in person.
• Industry vertical i.e. specialize in one particular industry
• Experience – have you got unique experience that you can highlight? Have you worked with people/clients of note?
• Awareness – if people have seen you name before, you stand a better chance of landing deals. This is why consultants speak at conferences, write blogs, write op-ed pieces for newspapers and other publications.

3. Demonstrate And Offer More Value Than Your Competitors

What are your competitors doing? More importantly, what are they not doing? Are there areas you can provide more value to clients than your competitors do?

Think about the points of resistance for a client. Put yourself in their shoes. One major point of resistance for the new independent consultant is perceived risk. Without a track record, the risk proposition for the client is high.

One idea for getting around this perceived risk is to give your services away for free.

Huh?

One local consulting agency I know of sold out to a competitor for a a tidy sum. When they started, they decided they needed a client list, so they offered their services, for nothing, to a list of preferred clients. The agency viewed this as a marketing cost. Once they had proved their worth, clients tended to stay on their books, and at very least, provided valuable experience and referrals.

Of course, you can’t work for nothing/discount rates over the long term, but such a strategy works well if you need to get a few good names – preferably industry leader names as opposed to unknown small businesses – under your belt.

4. Say What You’ll Do, Do It, Then Tell Them You’ve Done It

Actors often say you’re only as good as your last movie. In consulting, you’re only as good as your last gig. A bad reputation can be gained easily, and persist for a long time. So when you execute, stay focused on delivery.

The most effective selling method, by far, is good word of mouth. Each new gig gives you a chance to increase good word of mouth.

I hope this article provides you with a few ideas on selling your services.

The techniques you use very much depend on your own skills, history and ability. If you’re new to PPC, in terms of operating as a business, it’s often a good idea to work for a PPC agency before going freelance. This gives you valuable insight into the business of selling search, experience, and the opportunity to build up contacts.

Look at any competitive PPC area today, and you’ll notice many of the ads are selling the same thing.

This is a fundamental problem.

No matter how great you are at PPC, it the product or service you’re selling is flooded with competition, the more your margins will be squeezed. The more your margins are squeezed, the less you will be able to spend on advertising.

Long-term, that isn’t a recipe for success. Those with the deepest pockets will eventually win.

The Need To Differentiate

Theodore Levitt, an American economist and professor at Harvard Business School, said “There is no such thing as a commodity. All goods and services are differentiable”

If you’re pitching very similar products to those offered by other advertisers, you need to find valid points of difference that encourage visitors to choose your product.

If you have control over the product/service you’re selling, you have a number of options available to you. You could differentiate based on an emerging consumer trend. For example, some people are concerned about the origin of food. If you were selling coffee, you could draw attention to the source of the coffee as a valid point of difference. You could use fresh imagery to breath life into an old product, like celebrity endorsement. You could reduce price.

Simple stuff, conceptually.

If you don’t have control over the product, your options are more limited, but you can still differentiate. You could offer a different level of service. You could bundle the product with something else. You could leverage your existing reputation in another area.

The problem is that even if you’re successful with your differentiation, people will soon copy you.

What do you do?

Three Choices

At the point where copyists move in – and this happens fast on the internet – the vendor faces three options:

• Lower the price and accept lower profits
• Maintain the price, but lose market share, and ultimately profits
• Find a *new* point of differentiation and maintain price

Option three is going to be most preferable.

The Need To “Innovate”

You can see this at work on the likes of Clickbank.

Clickbank facilitates the selling of the same old get-rich-quick schemes that have been around for years. But “new” products keep selling, and the way vendors do that is by using new imagery, descriptions and context, and leveraging off older product lines. The price – typically $97 – has been maintained for years. The big selling vendors are often the same old faces who have been selling via that channel since it began.

The lesson here is this:

In order to maintain long term profitability, you cannot rely on your current advantage being maintained over time. Copyists will errode it.

Instead, always be in search of your *next* advantage. You can achieve this by constantly adding value, and/or new valid points of differentiation.

Keep in mind the value of “the new”. Or more precisely, the perception of the new.

There are many examples offline. Car companies introduce new models. These models are pretty much the same as the last model, but if they package them up a little differently, they have a new point of differentiation, and a new story to tell.

Soft-drink companies, like Coca Cola, leverage off their existing brand reputation to introduce new lines. Again, these new lines are bubbly sugary drinks, and aren’t really radically new or different.

The fashion industry changes every season. Microsoft introduce yearly – well, almost – versions of Office, even though a word processor hasn’t really changed much since the 80’s.

Notice a pattern?

Consumers love the new.

Notice another?

This stuff isn’t really new at all!

It’s just perceived as being new.

Being new is an easy point of differentiation to implement and thus maintain strategic advantage, so long as you have a plan to always introduce the new. When we consider that the new isn’t really new at all, and comes down mostly to cosmetic or subtle changes, it becomes even easier.

Do you have a plan to introduce the new as a point of ongoing differentiation? This might be something to consider if your competition is offering all offering the same thing, and stuck in a rut.

Take you product or service and give it a new twist. And have a long term plan to do so regularly