Quit Listening to Ruth

Ruth is this person whispering in your ear, several times every single day. She's never short of reasons why you should lower your pricing or compromise. She'd be a lot easier to ignore if she wasn't right, too. Or maybe not "right" but at least in good company.

Ruth is the person who keeps telling you to charge less, do this just this one time, or whatever. But Ruth is never satisfied. She assures you that it's just this one time, but she says that every day.

You need to be Ruth-less. You need to quit listening to her. It takes absolutely zero courage to back off, to keep doing the same things, to justify the lack of change, to keep putting nails in your own coffin. Ruth is the anti-courage. She's the niggling reminder that you are a loser.

We're so good at compromise—probably because we've practiced so much—that we'll even codify the process in case we forget how to do it. I read this in a document that a client sent me recently. They listed four reasons why they might go ahead and charge less than what their own estimate showed. (I've summarized their reasons because they are a great firm and I don't want to beat them up specifically.)

  1. Do we need this job? Will it cost more to have someone not working than to having them working on something that doesn't pay what it should?
  2. Is there long-term potential that we can monetize?
  3. Is there something other than monetary value (trade, sponsorship, etc.)?
  4. Do we need this experience for future work?

Now I know what you are thinking. "Shoot. I do that all the time. Seems pretty reasonable to me. Why is that so bad?"

The answer is because it's an addiction, and a really bad one.

There are three kinds of retail:

  • List price nearly 100% of the time (Apple).
  • List price most of the time, with an occasional rare discount (Macy's).
  • Constant bargains (TJ Maxx).

There are three kinds of experts:

  • In demand experts who reluctantly charge a certain amount. They even think it's a tad salty, but the money keeps them interested and funds all sorts of constant learning that gives them an edge. They don't worry about scope because they don't typically skate that close to the edge. They aren't worried about their internal margin as much as they worry about delivering value (respected legal counsel, bridge engineer). They don't work for clients who are looking for bargains. They think procurement is generally evil and they secretly hope that all the procurement people run out of propane in the middle of their big grilling party.
  • The same experts who have a yearly sale (can't think of any).
  • Constant bargains (they aren't experts).

It's really a mindset thing. I'll be talking with one client who's doing well. They have valued clients, what they charge is not a source of tension, and the firm has enough money to fund exploration and keep their team happy.

Another client is certain that they are bumping up against a price ceiling and they feel helpless. They can't imagine being successful at higher price points. They sound like an old man who thinks the next generation is going to hell. In their mind it's a widespread conspiracy and things just aren't what they used to be.

The crazy thing is that I can hear both perspectives about the same client (because they share one).

Psychologically, they need someone else to blame. They rehearse this story about "the marketplace" and they'll recount the "facts" any time someone will listen, even if they aren't really interested.

If you think it's you against the world, you might need a therapist...or a new job. There are 131,000 firms in North America alone, and I'd estimate that they can be broken up like this:

  • 15% see no ceiling except their own self-made restrictions. They love what they do and optimistically learn new things every day. They aren't paying attention to the other 85% at all. They'll thrive.
  • 65% are open to learning but they are a little indiscriminate in who they listen to, hoping for some secret or hack. They keep trying things, looking for external affirmation. Eventually they'll find their way. They'll do fine.
  • 20% are the downers with a whole tribe of Ruth people in the chorus behind them. They are preachers with the same stale message, and the choir nodding "yes" at every tired pronouncement.

Do all your clients seem kinda cheap? Slowly reinvent your firm, one client at a time.

Are you worried that your area of focus doesn't reward expertise? I'm not buying what you're selling, here, but pretend it's true. Wouldn't there always be room for at least one firm who could be viewed as a top performer and worth the investment?

Regardless, the foolproof solution is pretty obvious. You have to have enough opportunity lined up that you don't break into a cold sweat if you hold the line on this particular one right in front of you.

That's it. Nothing else will fix it every time. Fix your positioning and then build a simple marketing plan that delivers that opportunity.

Here's what I'd suggest:

  1. What's the liberated version of your firm? Who are you doing work for, what are they paying, and what difference are you making in their world?
  2. What are the specific things you need to do in order for that to be your reality? What gaps need to be closed? What needs to change?
  3. What's a reasonable timeframe to get there?

It's going to take a combination of the right answers, saying no to lots of things, discipline, and courage.

Here's where I'm tempted to say "Go for it. You've got this!" but I'm not going to. A big congrats to those of you who are already there. A smile and encouragement to those of you who are open to it. And a plea to go do something else if you keep repeating Ruth's stories to yourself, dragging the rest of us down.

You either have a lot of courage already to charge what you should, or your courage needs some buttressing with excess opportunity.

The human spirit is a remarkable thing and we need a little bit more of that and a little bit less shrugging the shoulders.

We could use a little less Ruth and a little more ruthlessness.

(And my apologies to all the really nice Ruths...and Karens...out there.)

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