We recently asked the community for questions we could ask top producers for a podcast. One of the questions was “Given a choice of Fast, Cheap, or Right, which two should I choose?”
The expression they were alluding to is Good, cheap, fast. It’s a popular Venn diagram meme that tries to demonstrate that it’s unreasonable for a client to expect to get all three, in the meme, it’s usually proceeded by the line you can only pick two.
The basis of argument is that there is always a trade off and the client should decide which;
Cheap and fast = low quality
Fast and good = expensive
Good and cheap = takes time
But what if you could help the client decide before they even consider you for the work, is that possible?
Seven Dogs Chasing The Same Cat
In my book ‘The Book Dad Told Me Not To Write’, I talk about Seven Dogs Chasing the Same Cat. What I mean by this is that if you just do the same as everyone else, then you’ll be fighting for the same customers and that’s a much harder game.
We used to live in Greenwich in London. It is a pretty part of the UK capital, with tightly knit streets of Victorian terraces, townhouses and a couple of rows of specialist shops like a butcher, greengrocer, cheese and bread shop, and fish monger. Then there is the centre of Greenwich, with lots of restaurants, coffee shops and cafés. It also has two supermarkets: a Sainsbury and Co- Op Local, so we were just a couple of minutes’ walk away from supplies.
Every Saturday morning, a queue would form up the street, where the row of specialist shops was located. Sometimes it would take 15 minutes to get into the store. If you were early enough, you would get what you were queuing for, but often not.
We were queuing for bread. Not just any bread, but bread costing £3 a loaf! Just one minute away there was no queue for bread costing 50p a loaf.
The bread in the supermarket was piled high and perhaps OK for toast and sandwiches, but the sourdough bread we queued for on a Saturday morning was sublime.
Both the stuff in the supermarkets and at the bakers was bread, but one of these establishments had a queue of people down the street who were willing to pay a premium. You might think the people willing to wait and pay through the nose were insane, but that’s irrelevant. What matters is that some people valued the quality enough to do so.
The more unique you are, the less you’ll be fighting for the same customers, and the less price sensitive your potential customers will be. People are willing to pay a premium if the product is exclusive. They are also willing to pay a premium if your product and service is better.
Price Is A Message
Price is a message. It defines the type of customer you are likely to get. Some brands intentionally price their products to exclude certain people from buying them.
There’s nothing that amuses me more than seeing a comment on social media saying, “If you priced it lower, then you would sell more.” My first reaction is to say, “No shit, Sherlock.” However, I usually observe that the product has been priced intentionally to attract a certain customer. They are not trying to get more customers, they are trying to get better ones.
If you are dreaming of buying a £70,000 Ferrari but gulping when you see the price of a set of new tyres or a service, then it’s not for you. A Ferrari is aimed at people who don’t even think about those things. As my Dad used to say, “If you can’t afford the tyres, you can’t afford the car.”
If your products or services are the same as everyone else’s, then you immediately enter a price sensitive market. If you are the only one doing what you do then, within reason, you can determine the price.
I’ll repeat this: To succeed in business, you either have to be better or different.
Take Cheap Out Of The Equation
So to my original question, can you take cheap out of the equation?
Yes. You take yourself out of that market, you stop chasing the same cat. You create a business where your clients understand that in order to get quality work delivered on time then it has a cost related to it. Just like the bread illustration, while there are people who will settle for a 50p loaf of bread, there are also those who willing to pay £3. It’s not the same bread and it also follows, it’s not the same customer either.
That’s why by putting yourself on one of the multitude of online on sites trying to get work you are effectively asking people to decide on price, and in most cases those customers start with price.
It’s irrelevant if you’ve invested £100K on a studio or worked with half the industry creating hit after hit, or mixed tons of top movies. You are competing with people who will record and mix you a song for less than a coffee… see below!
All these sites are similar. Yes you will hear stories of people making thousands a month on those sites, but like Spotify, that’s the exception and not the rule.
All these online models are based on a long tail of 99% of users who make very little from the service. You look at sites like YouTube, Spotify, Instagram et al and think you must be missing out. FOMO (The fear of missing out) means there’s always enough people who will invest a lot of time and effort trying to get work using these kind of services. YouTube, Instagram, all of these services encourage the same behaviour - but ubiquity isn’t the path to a secure income stream - quite the opposite.
Be Exclusive
It might seem like a bad idea to try and reduce the amount of customers who may want to use your service, but what do you want, more customers or better ones?
I recall some years ago a client who told me he was going to get more customers by cutting his price by half. Instead of the service costing £100, it was going to cost £50. The first thing I told him was that he needed to get at least twice as many customers to get the same amount of income. Furthermore, that means dealing with twice as many customers to make the same amount of money.
My father used to say there’s one solution if you have too many customers and not enough time and that’s to put up your prices. Sure, you might lose some customers, but you’ll make more money with less effort.
Good, cheap, fast? Why don’t you make the decision?
This article contains extracts from Russ Hughes’ new book ‘The Book Dad Told Me Not To Write: You can run a better business with these simple words of wisdom. More information on the book and where to purchase can be found here.
Listen to an exclusive pre-release audio book chapter that this article is based. Soon to be released on Audible.