How to easily increase the perceived value of your accountancy firm’s services
I’ve had more than a few discussions lately about value based pricing for accountants, in all of which I’ve explained how pricing, at least effective pricing, is more about value than cost. To start charging what your firm is worth, I’m sharing how to easily increase the perceived value of your accountancy firm’s services.
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A quick note on value versus cost
Why would one client begrudge paying £120 per month for bookkeeping when a similar client with a similar business would happily pay £400 a month for the same service?
This type of scenario has boggled the minds of many accountants because the answer doesn’t come down to one having more money over the other. The difference is the perceived value of the service, not the absolute price.
When it comes to value based pricing for accountants, it’s important to remember that:
- Your Prospect/Client determines the value of your firm’s services, not you.
- Your Prospect/Client will only buy IF they perceive the value to be greater than the cost of purchase.
- The more value for a Prospect/Client (e.g. the stronger their need), the higher the price they are prepared to pay.
- Fixed fees, with the right context, can allow you to charge significantly more than charging by hour.
Put simply, you need to understand your Prospect’s/Client’s specific need or pain point so that you can position your firm as the solution. If you can put together a specific package where your services address or eliminate these, then it will be much easier for you to charge more as your Prospect/Client sees great value in it.
As we said, it’s about value rather than cost.
After 6 months in the club I was able to stop worrying about cash flow.
When I first joined the club I was living hand to mouth with my cash flow, often having to dip in the money I had put aside to pay my VAT and corporation tax bill.
I’ve learnt to ask for a price which is in line with the value our firm brings to our clients. In fact, my time in the ‘member spotlight’, was probably worth £50-100k of extra turnover within 12 months of the conversation.
After 6 months in the club I was able to stop worrying about cash flow as I now normally have 30-90 days of cash in the bank on top of the money I need to pay my VAT and corporation tax squirrelled away safely.
6 simple and cheap ways to increase the value of your services
The key to increasing the value of your firm’s services rests in your firm’s marketing, sales and account management processes. Just remember that we all DO judge a book by its cover and it is your Prospect or Client that determines your value!
As the value your Prospect/Client attributes is very reliant on context, here are 6 ways that you can easily increase the perceived value of your services.
1) Focus the messaging on your website to the type of Clients you really want to win
Trying to be all things to all people on your website is a waste of time, so focus your messaging to target the types of clients that you actually want to attract. For example, if you don’t want to attract startups, sole traders, contractors or landlords, then don’t talk about them on your website. When you create the right perception for a Prospect and position your services as the solution to their specific pain points, they will automatically, due to Confirmation Bias, decide that your firm’s services will be highly valuable to them.
2) Understand and highlight the emotional drivers for buying your firm’s services
Generic messages such as “we save you more tax” and “we will help you grow your business” may be very rational reasons to potentially buy your firm’s services but none of them make any emotional connection with your Prospect. Prospects are motivated to buy when an emotional connection is made so understand their motivations and specifically highlight these. Messages such as “we give you more time with your family,” “we take on your admin to give you more time to grow your business,” and “we help you to enjoy your business again” all make much more of an impact and elicit action.
3) In your sales process, spend time really understanding their requirements and their personal motivators for these requirements
As we said above, it is your Prospect that determines the value of your firm’s services, not you, and the more they value something, the more they are willing to pay for it. That’s why it’s essential that you understand what they really value. Only when you understand can you find the services they are motivated to buy and then charge more for these services. For example, when a Prospect has got into a muddle with their payroll and been fined by the Pension Regulator, they will place much more value on you handling all their payroll and pension administration.
Within the club’s membership library is a complete sales process for you to adjust to your firm’s sales process. Included in the process is:
- Complete scripts for each meeting in the process (and instructions for how to amend them)
- Checklists for each stage and ideas on how to really wow your prospects
- Suggested ways to talk about price without scaring a prospect away
- A workflow for you to put into your practice management system to make sure you never lose a good quality lead again
4) Really look after your Prospects in the sales process
Remember, your Prospects are judging you and your firm on how they are treated during the sales process. Not only that but during this time, they are also making judgements on what it would be like as a client of your firm based on how they are treated during the sales process. If you make a Prospect feel like they are really important to you and that nothing is too much trouble, trust us when we say that they will be prepared to pay more for your firm’s services.
5) Openly display real testimonials on all your marketing materials and assets
Due to a psychological phenomenon called the ‘Bandwagon Effect,’ the more social proof you can provide to demonstrate that your firm is great, the greater likelihood that your Prospect will place more value on your firm’s services.
6) Highlight how much the ‘little’ extras of your firm’s services would cost them if they bought them separately
Prospects often don’t realise how much it would cost them to buy all the ‘little extras’ separately, so simply by making them aware of the cost, you can significantly increase the value of the package that you are offering them. For example, if your firm includes a subscription to cloud accounting software and a bookkeeping app, this could otherwise cost the client £60 a month so make them aware of the savings. Providing tax investigation insurance, allowing clients to use your office address as their registered address and use of your firm’s meeting rooms can all add up too.
Increase your value and your costs will increase with it!
Back at the beginning of the article, I said that value based pricing for accountants is far more effective when it comes to charging what your firm is worth. This is because when Prospects or Clients perceive the value of your services to outweigh the cost, they will be far more willing to buy and pay more for it.
As value is determined by your Prospect or Client and is heavily influenced by context, perception of your firm, and the strength of their need which your firm’s services are eliminating, only when you understand their needs and emotional drivers can you effectively increase your value to them. Once you increase your value using these 6 tips above, you can start charging a lot more for your services.
Learn more about value based pricing for accountants by reading the first 4 chapters of our new book “Pricing with confidence” for free here!