How To Think About Optimizing Your Product And Service Ladder
- February 22, 2023
- Posted by: Rochelle
- Category: Monetizing, Running Your Business
When you believe your product and service ladder isn’t optimized for you (revenue, time, flexibility) it pays to do a deep dive into your business and revenue model.
“Sharon” runs a consulting practice that looks a lot like many successful B2B experts lead: a high end, high value service with an entry level introductory option.
Her product/service offerings—or ladder—look like this:
Industry thought pieces via email (2x month): Free
Entry service (1x assessment): $2,500
Advisory service (recurring annual): $20,000+
Custom consulting: $50,000+
Most clients start by buying the entry service and then about 80% go on to one of her higher options—and stay engaged with her for years.
Her advisory service is highly leveraged and exceedingly profitable, so her goal is to funnel her best-fit clients there.
Since up-selling 80% of her introductory projects is a pretty good hit rate, her challenge wasn’t closing on new advisory clients. Instead, she needed to get more of her sweet-spot into the pipeline for the entry service.
It’s an interesting problem because there are many ways she could tweak her product and service ladder to solve it:
She could start a (free) podcast on her specialty and create a new avenue for fans to find and engage—and ultimately funnel to her introductory option.
She could write a book to entice a much larger audience to engage with her content and up-sell to her $2500 option. That book might also push her into more speaking engagements that will put her in front of her best clients.
She could create a self-directed course to teach an essential principle (one of several that she covers in the introductory option) and price it in the low to mid hundreds.
She could even offer a virtual, live workshop—with a still higher price point—where she teaches to many how to do what she performs one-to-one.
She might even go all the way to a membership option where she keeps a significant cohort warm as she teaches her expertise and how to apply it to their situation.
It’s helpful to know that her typical client is a Fortune 1000 C-suite decision maker, which makes the last three of these options less attractive to her.
So, while intrigued by hosting a podcast, Sharon gravitated to the book concept, even though it’s a high commitment, low price point option.
She felt her audience highly values being served by an acknowledged expert—which is what publishing the right book will make her.
And that book will help grease the skids to paid speaking opportunities and invitations to industry platforms that are jam-packed with her ideal audience.
Here’s my point: the thing with optimizing your product service ladder is that there is no one right answer for everyone.
Start by understanding how you currently pull potential clients and buyers into your pipeline and how they work their way through your offerings.
Not to mention how you most want to spend your time and contribute to your bottom line.
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