Rise of the Innerpreneur

A Pricing Approach to Raise Your Consciousness

I’ve decided to try something that might sound a bit crazy. I’m going to let my customers set my prices.

My Price is Your Value

I’ve heard of two restaurants, and a guy who wrote a book, all of who sell their product and/or service by value.

One restaurant is in Australia and one is in my hometown of Toronto. I’ve never eaten at either.

The guy who wrote a book is Philip Dignan. He wrote the fantastic, Secrets of the Wealthy Mind, and his thoughts have helped inspire this decision.

Interestingly, in Wealthy Mind, Dignan writes of innerpreneurship too, and on a much deeper level than Karma Queens, Geek Gods and Innerpreneurs.

Money as a Currency, Literally

The laws of physics state that energy can be converted in form but cannot be destroyed nor created. In a similar vein, we can conclude that individually whatever energy we give will be returned to us.

Money is a means by which two people can exchange a current of energy. As the seller I am providing energy in the form of my product, and as the buyer, I am providing energy in the form of money. With every business transaction, we are exchanging energy as well as money. As such, we can see currency or money as a tool for two people to exchange a current of energy.

For a long time now I have been giving thought to the nature of the current I am exchanging. I desire to be conscious of my energy around money. But I still feel subservient to it. There is more I can do to raise my consciousness.

Your Energy and Money

Unconscious Approaches to Money

  • The energy of ‘taking’ – you drain energy from the other person as you are terrified of losing what you have worked ‘so hard’ to acquire.
    Result: You get a few ‘cheap’ transactions but you establish a pattern of guilt and projection. The ultimate result is someone taking you for a ride or you hoarding your money for fear of it being taken.
  • The energy of ‘take from me’ – you holding yourself unworthy.
    Result: You will typically find yourself in situations where others take advantage of you. You find that you never have any ‘luck’ with money and that you are always undervalued.
  • The energy of ‘I fear money’ – you placing money outside your conscious self.
    Result: When you receive money you fear it rather than celebrate it by questioning if you will have enough next time.
  • The energy of ‘I work hard for the money’ – you are your own generator.
    Result: You insist that every ounce you have earned is because you ‘made it’ happen. You do not allow money to flow freely.
  • The energy of ‘too much’ – you have more money than you will ever need.
    Result: An internal void and a lack of respect for money and people.
Related Read:  Mapping the Results of Giving Freely

Conscious Approaches to Money

  • The energy of ‘what can I give?’ – you enter an exchange not focusing on what you can get but rather what you can give.
    Result: You receive what you give and your current of giving is amplified.

My Energy and Money

I float between ‘what can I give?’, ‘I work hard for the money’, and ‘take from me’. I always want to help. I often feel like I need to be working harder. And when I do price my services, I undervalue them. No more.

Using exclusively the “what can I give?” approach I establish money as an instrument of consciousness and every transaction becomes an opportunity for me and my customer to extend our true Self.

While I care about money, as I understand the freedom it allows, it is not my driving motivation. The innerpreneurial motivation is to express our wealth through our gifts and knowledge (intelligences) and to extend our true Self via our work. Thus, it makes perfect sense for us to offer the product of our intelligences for sale, not for it’s monetary value, but for it’s contribution.

Related Read:  The Game of Money?

How Do People Know What to Pay Me? or How Will People Know How Valuable I Am Without Me Telling Them?

While I know people value ‘websites’, I doubt they understand the time, money, love and energy that go into making a good one.

You can replace ‘websites’ with your service and/or product. I am certain you had the same question about value (or what you can give) pricing and it’s a good one.

How can we really know that we will be paid fairly? We can’t. Just the same as we can’t know that our businesses will be a success. There is no guarantee. You must simply silence your doubt and believe in the power of universe.

But, if you want, examine your past customers. You’ll likely notice that you attract a certain type of client, one that does value your work. If this statement isn’t true, you likely need to examine your energy around money.

My Problems with Value Pricing

The idea I keep getting stuck on when it comes to value pricing is customer education. I keep thinking that in order for someone to accurately value my work, they must be educated about it.

I’m not sure if I am right. I wonder if customers will feel uncomfortable setting a price without having been properly educated.

I’m also conscious of material costs. Without setting a price, how does the customer know how much money went into the product/service upfront?

Ideas on Approaching Value Pricing

Customer pays material costs + value, e.g., $12.92 + value. This addresses the issue of material costs and at first I liked this idea but now it doesn’t seem right.
Make available to the customer the estimated number of hours spent working on the product/service. I still think this is a good one. I am certain that each of us would argue that no one understands how long our work takes.
– Make available to the customer detailed information on your process and the hours spent on the product/service. Perhaps this is the best option. Though I wonder if the best approach is simply to let it be  without bombarding them with information. Am I missing something by feeling as though I need to inform and educate customers? Am I invariably sending out doubtful energy?
Let them set the price. Period. They don’t need education only experience. This answer worries me… I have reservations about it.

How I’m Structuring My Value Pricing

This is where I need your help a bit. I don’t know of any services who have used value pricing before so I am making this up a bit. For now, I’m thinking I will ask for a value payment for every exchange. For every business exchange I have with a client, I will invoice them afterwards with a description of the service and hour(s) worked but without a price attached. They will fill in the price. The price will reflect the value they received.

Related Read:  The Credit We Give Ourself

Or won’t it? Is providing service and hours worked information swaying the value they may place on my work? Should it simply be an invoice with a description, without hours? How would you structure your value pricing?

Hello! I’m Tara, a wizard of less obvious things. I love hearing from you, so please feel free to connect with me.

I deeply appreciate your support of my work—through allowing it to grow in your imagination, through sharing it with others, and through your financial support.

About Tara Joyce

Hello! I'm Tara, a wizard of less obvious things. I love hearing from you, so please feel free to connect with me. I deeply appreciate your support of my work—through allowing it to grow in your imagination, through sharing it with others, and through your financial support.

13 Thoughts on “A Pricing Approach to Raise Your Consciousness

  1. jamie on March 4, 2009 at 8:55 PM said:

    What a fascinating approach. I'll look forward to hearing what you discover.

    This summer a contractor did some work for us and it took much longer than he originally anticipated. At the end, he gave us the price he quoted us, the price that accurately reflected how long it took and let us choose anywhere in between that we felt good about. It was a great way of handling the situation and we all felt good about it. Having the parameters helped. I must admit I would have felt stressed if it had been wide open.

    Okay, here's a sentence I never thought would come from me: I'm fascinated by all of the complexities of pricing.

  2. >I don’t know of any services who have used value pricing before…

    I've been doing 'no fixed-fees – you decide what to pay' for years with my business advice & support gig.

    If anyone's interested, ask me for details.

  3. Jamie,

    You brought up such a great point and one that I have been stuck on –
    will customers feel uncomfortable or stressed having to set the value?
    The whole point of value-pricing is to remove the negative energy that
    exists around money.

    What I keep coming back to is that this day in age, before most people
    purchase something, they take the time to educate themselves on the
    product and understand the price/value of it. Taking this into
    account, a customer likely already has an idea of how much they can
    spend and conversely how much it should cost.

    This is such new territory for me. I started thinking about this
    approach while in Nicaragua and the idea kept growing on me. There are
    so many unknowns with it but that is what excites me. It is an
    adventure into the unknown.

    I wrote another piece on pricing that might be of interest to you now
    that you are a pricing geek;) http://www.elasticmind.ca/innerpreneur/index.ph

  4. Gulliver,

    I certainly am interested and I'd love to hear more about your
    experiences with value pricing. I will email you. Thanks!

  5. Eric Reynolds on March 5, 2009 at 12:39 PM said:

    Value. Value Pricing. Such an interesting concept and always an excellent conversation starter. Your value pricing model will certainly be an interesting experiment, but oh what a slippery slope. Careful, your demand curve could rise rapidly beyond your capacity to serve your clients.

    I've read that in 2007, the rock band Radiohead offered its album 'In Rainbows' as a download for a “pay as you want” price. Research concluded that an estimated 38% of those that downloaded the album paid an average of $6. That price is less than half what I pay for a physical CD at a local Target or Wal Mart.

    I look forward to following your posts as your value pricing experiment unfolds.

    Good luck to you,
    Eric

  6. Eric,

    Great points. Here are my thoughts on them:

    on too much demand – this assumes that I work with everyone who
    approaches me, which I do not and will not. I almost look at it as a
    great way to ensure you are working on the projects that I am truly
    passionate about.
    on Radiohead's findings – I appreciate the statistics though I am
    always wary of them as you can manipulate them to tell whatever story
    you want to tell. While you note that 38% were sold for less than the
    “regular price”, the stat doesn't tell you how many of the 62% was
    sold for more than “regular price” or if they found that they sold
    more CD's, in general, using this price model. These two factors are
    important when looking at the 38% stat.

    I wrote a bit about the economics of my decision in the post, Get Paid
    Your Value, Not Your Price – http://www.elasticmind.ca/innerpreneur/index.ph

    Thank you so much for sharing your thoughts. This will be an
    interesting experiment, no doubt.

  7. Very interesting. I have no doubt that this is a beautiful inner-directed approach, but for myself as a consumer, I would be overwhelmed if there was no pricing structure. It would place a lot of pressure on me to accurately portray how I valued the product/service. I most likely wouldn't hire someone with this kind of pricing structure, because I would be terrified that I would unknowingly undervalue their work.

    But that's just me. Your right client may not feel that way at all. I guess it all depends on who your clients are and how comfortable they would feel with that approach.

  8. Sarah,

    Thank you so much for sharing your honest opinion about value pricing.
    I think you have raised a key point to address with value pricing and
    that is putting the customer at ease. The last thing that value
    pricing is suppose to create is an environment of fear. If anything,
    it is suppose to remove the fear and anxiety that surrounds money.

    One thing I have thought about in regards to undervaluing someone is
    this: if you approach a product or service with an interest in
    purchasing it or using it, you have likely done so because you already
    see the value in it and deem that you can afford it. In reality, you
    have already placed a value on it without even knowing it. Your
    decision to not buy the service or product likely will result from A.
    the price exceeding the value you placed on it, B. the value being
    less than you expected and are willing to pay for. Either way, the
    true value you place on the product/service is what will determine
    whether a purchase is made.

    Perhaps what it really comes down to is trusting your instincts. Even
    when it comes to money and pricing.

  9. What a great post Tara!

    I'm a musician and have been fascinated about this subject, even before Radiohead did their version of it. When I released an album at the end of 2007, I was going through a lot of the same thoughts as you mentioned in the post and decided to try one version of value pricing. In the release week, I offered to send a physical CD to everyone who gave me their street address and provided them with my bank details so that when they had listened to the album, they could pay whatever they felt the music was worth to them (including nothing). The worst case scenario was that I would send free CDs around the world and pay not only the manufacturing of the discs but also the mailing costs (and naturally the value of the creative work).

    It was a pretty encouraging case study. Most of the people paid about the average of what a music CD costs at a record store, but a few also payed a lot more. Also there was not a single person that did not pay anything, so any fears of being used where really unnecessary.

    I am spending a lot of time/money/energy on my next album/media project and am wondering if I will be able to try that same thing again. Judging from the results and feedback that I got it should be a no-brainer, but still the human mind is always producing some background doubts. I'm confident thought that I will implement some version of value pricing, that's for sure :)

  10. Ali,

    Thank you for sharing your story with me. I am so pleased to hear of
    another person (besides Radiohead) using this model. And even better,
    finding positive results with it. I too have been practicing value
    pricing for a month now and I am more than happy with the results. The
    feeling of doing business with someone is completely changed. It has
    truly become an exercise in the true value I can create for others,
    rather than if my prices meet my perceived value.

    I'd love to be updated on how your new album goes and if you use value
    pricing again.

    Thanks for reading.

  11. I just want to say I appreciate you engaging with this even if the subject does tend to degrees of 'wrestling'! And ultimately, it has to be this willingness to engage with the money conundrum that gave birth to everything from the Ithaca dollars to the North Dakota Innovative State Bank (90 years young and contributing hugely to Statewide thriving). Somehow every engagement with money as a medium (of exchange & for mutual benefit) is fundamentally contributing to evolving it, however that plays out.
    PS I also am 'playing' with these concepts and have lately added the 'give-away-a-dollar-a-day' practice (anonymous & fun!), which has everything to do with flow/currency/current/flow

  12. “Somehow every engagement with money as a medium (of exchange & for
    mutual benefit) is fundamentally contributing to evolving it, however
    that plays out.” Excellent point.

    I'd love to hear more about your 'give-away-a-dollar-a-day' practice.

    Thanks for reading,

    Tara

  13. Pingback: Value Pricing Your Service Business: Establishing a Payment Structure | Rise of the Innerpreneur

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A Pricing Approach to Raise Your Consciousness

By Tara Joyce Time to Read: 5 min