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Local Pricing Strategy And Being The Value Provider In Your City.
Local Pricing Strategy And Being The Value Provider In Your City.

How much can I charge in my area for piano services?

Timothy Barnes avatar
Written by Timothy Barnes
Updated over a week ago

If you are a business owner who cares about your customers, then you know how much it stings when you lose any client to the low cost service provider (who is often also the low quality, low skilled, fly by night operation with terrible customer service). And if you are worried about losing good customers because of charging too high of a price, this article is for you.

If price is the only thing that matters to customers then every customer would use the cheapest and every service provider in your city will be caught spiraling downward in a race to the bottom; a race to doing the lowest possible low-quality work, a race to 'Free'. This is not a race you can afford to win. It is also not a race you have to participate in. You can run the other direction by competing on providing the most value instead of the cheapest price.

If are not the cheapest then you are competing on something other than price.

If your prices are not the cheapest, then you have to compete on something other than price. And odds are you are already doing this whether you realize it or not. By competing on value you must focus on increasing the quality of your work, focus on being an expert in your field, focus on improving your craft, and increasing the level of customer service you provide. The value you choose to provide is up to you, not somebody else. Which means you must differentiate yourself on these other things. So adjusting your price means you are going to have to consider the value you are providing in every area of your business.

Who determines the prices ranges for a local piano service market?

You get to set your own prices. So does everyone else. And if you are focusing on being the value provider (the most expensive) then as part of your pricing research you are going to have to ask the question 'how much can one charge in my area?' The answer is, whatever you need. But there are reasonable limits and there is a way to predict how much the most expensive service provider can reasonably charge in any given market (and this applies to both metro and rural service areas). It is called price elasticity.

If you spend a thousand hours doing granular customer research surveys of everyone who owns a piano in your city, you will find every person is actually willing to pay a different amount. So let's save you a thousand hours! While you get to set your own rates, two people in your market who are not connected to your company get to control how much the top end can reasonably charge for piano services in your local market. These people are the 'second most expensive service provider' and the 'cheapest service provider' in your area.

The spread (not the actual price) between the cheapest and the most expensive is what matters.

The spread between the top end of a service service in your local market is what you need to measure. This spread can also be extreme (as much as 2x the second most expensive service provider or 4x the cheapest). This means that if the cheapest service provider in your area is $100 for X service, and the second most expensive service provider is $185 for X service; then if certain criteria are met the top end of the market can be somewhere between $370-$400 for the same service offered from the premium service provider who guarantees their work and has great customer service. This is not exclusively true, it could be more in extreme situations; but when you find someone charging more than this range there are usually contributing factors that can't easily be applied to your situation (more on this later). The important thing to remember is to focus on the 'Spread of prices' in your area when doing pricing research.

The majority of service providers all cluster casually around the cheapest service provider

Most of the time you don't find a healthy spread between the low end and high-end service providers. Instead you find the opposite. The majority of the service providers tend to all cluster casually around the same low-end price point with very little spread between the cheapest and the most expensive. This is the definition of an unhealthy free market. In these unhealthy markets everyone fears the cheapest but nobody seems to know how to break out and be the premium service provider in their area.

In a free unregulated market no two service providers should charge exactly the same price.

Thankfully every market has a wide range of price elasticity. No two service providers should charge exactly the same price, unless they are copying each other which is a mistake (and sometimes illegal if they are engaged in anti-competitive behavior). But regardless only one person can be the cheapest and only one person can be the most expensive. The upper limits of a healthy market go to the value provider who is usually:

- an expert in their field with at least 10,000 hours (5 years full-time experience),

- the one who is most likely the most expensive
- the most reviewed in an area,
- the one who has the best reputation, communication, marketing, and brand positioning; and

-the one whose customer service is second to none.

If all of this is true of your business then you can establish the top of the market and reasonably create a wide spread between your prices, the cheapest provider's price point, and the second most expensive price point in your market. Which by extension also creates a wide and healthy margin for everyone in the middle. By that metric two people control the upper price in any given area and neither of them work in your business. The first is the cheapest provider and the second is the second most expensive.

What if I am in the middle of my market?

Regardless of where you choose to price your services if you have someone who is more expensive than you, and someone who is way cheaper than you, that actually gives you more room to comfortably charge anything you need between these two points with little concern. If you are the cheapest your marketing is easy "Choose me for my price", but providing long term sustainable quality will always be your challenge. If you are the most expensive value provider then you know all too well that 100% of the people choosing to do business with you had an option to go with someone who is substantially cheaper than you, but they chose you! And if you are in the middle, you are probably invisible and your biggest challenge isn't your price point, it is how to differentiate yourself so you stand out.

NOTE: In rural areas where you are the 'only one' sometimes technicians from the closest metro markets with high travel charges or limited availability are the only competitors. Remember to take this into account because you are almost never the 'only one'.

What does it take to be the premium service provider?

If you are the most expensive, your customers always have options but what you find is they still choose you anyway. They chose you because of something other than price and your job is to deliver on their expectations, including servicing their piano at the highest possible level which requires a lot of skill, experience, attention to detail, and good customer service that few people hone. If you don't have these things you will not be in business long without charging basement rates. In order to be the best, all 5 of the following things need to be true of you and your business:

#1: You need to be an expert in your field.
Everyone on your team needs an average of 5 years full-time experience. If you don't have at least 5 years experience (or 10,000 hours in your field), then work towards this as a goal and focus on honing your craft and systematically raising prices over time as your value increases. But if you (or the average across your team) have over 10,000 hours experience in your field then there shouldn't be a reason you can't provide enough value to be the best in your city. And if you are on the low end of experience you are probably already heading in the right direction and well on your way to being an expert in the basic disciplines of this craft: tuning, repair, and cleaning, with increasing skills in regulation and voicing.

#2: Your company needs to be the most reviewed in your area by a long shot.
You need to have twice as many public and highly visible online reviews as the second most expensive option, or 4 times as many online reviews as the cheapest person in town if you are going to put an extreme distance between you and the next person in town. You need to both BE the best and be PERCEIVED as the best.

#3: You marketing story needs to be dialed in.
You don't have to have a branded company (Your company name could be your name) but when your customers engage with your company they need to be the hero of the story and identify with your brand as their guide, not the other way around. They are the hero not you! Your website needs to reflect this and be highly polished, have fewer words, be visually differentiated, and overall look better than all the rest.

#4: It needs to be easy for customers to do business with you.
You need to go through every touch point in your company and ask "How can I make this part of interacting with my company easier for my customer". If a high price creates friction, you cannot afford to have excess friction anywhere else in your company. Maybe you reword how you describe your services or bundle travel fees into an all inclusive higher base price so the customer has fewer decision taxes to consider when working with your company. Or maybe you delete 80% of the content on your website so it is more clean, polished, and focused. Whatever you do, it needs to be easy for people to do business with you.

#5 Your customer service and interpersonal skills need to be second to no one.

Everyone in your company needs to have great soft skills and the ability to work with customers who expect the best. If you promise the best and send someone to their door who doesn't care, that isn't going to work. They don't need to be a 10 out of 10 on all counts. However, hiring someone who is a 2 /10 isn't going to fly. All your people need to be above average on their A-game at every interaction.

Running a company like this is actually quite fun for everyone involved, it also isn't something you can do half-way. If your prices are going to command this much of a spread (meaning if they price shop you they will find at least a 50%-75% discount elsewhere) then your customer promise and fulfillment cycle needs to deliver, which means you need to pay attention to all the little details including the dog's name!

Can I be the premium provider without charging 2x more than the second most expensive?

Yes. there is way to design a pricing strategy that wins no matter your price point and it almost always has to do with differentiating on quality not price. If you cleared all 5 of those criteria above and you choose not to be 2x more than the next person, this is a really easy sell because by definition you are under charging and over delivering on your services. In this case charging 1.5x or 1.75x is easy to do but don't make the mistake of grossly undervaluing your services. If all 5 of these things are true then you should be on the higher end of the range, not the lower. And if you want to be the most expensive by a smaller margin, we are not saying you have to be 2x more than second most expensive to be the premium service provider; what we are saying is that if you want to be 2x than the second most expensive service provider in your local market, without exception, all 5 of these criteria need to be true. However, if you choose to have a good (but not as extreme) spread in your prices you can charge as much as you want (usually not even in the same ballpark as the cheapest provider in town and with a good distance between you and the next provider). But keep in mind, if you claim to be the best, the top customers in your market (the people with enough money to make a significant investment in their piano) will not believe you if your prices don't align with this marketing promise. So you don't want to cluster around everyone else. Just make sure you have a healthy margin between you and everyone else.

Don't undervalue your services

When your customers invite you (or your employees) into their multi-million dollar homes (or into an event space where they need to count on the job being done right the first time), they are often paying you for more than just your expertise. If knowledge was their problem they could have googled how to tune a piano and done it themselves. But your expert knowledge is only a part of why they choose to pay you as the premium service provider a commanding fee. They are also paying you not to damage their home, they are paying you so they don't need to worry about having you show up on time, and they are paying you to save their time so they don't have to hire someone else to clean up your mess. These (as well as other reasons you may never know) are all in addition to knowing that by hiring you or your team they are getting the most knowledgeable expert in the area who will most likely leave them with the biggest possible smile on their face the next time they sit down to enjoy their piano.

Could I ever charge 5x-10x the cheapest in my local market?

Yes, but common sense says 'no' unless you are the ultimate subject matter expert in your area AND probably in high demand. It could be that you are the concert technician for a prestigious performance center and you don't want or need private clients, but you are more than happy to walk out the door early on a Saturday morning and charge $1,000 for _____ service that others are only charging $200 for. Or maybe this client got burned by a someone who gave them bad advice and they are paying for a second opinion. In both cases, the client is paying a premium to get YOU and nobody else. We are not saying it can't be done, we are saying that when it happens it is the exception and there are almost always other circumstances at play that don't apply to the every day situations most businesses are considering in their pricing strategy.

Who do you want to be in your area?

If you want to be the premium service provider in your area commanding a healthy fee for your expert and professional services, there are only 5 things between you and this dream:

  • About 10,000 hours of experience,

  • A bunch of online reviews which you can start collecting today,

  • Intentionally making it easy for customers to do business with you which you probably want anyway

  • Great customer service / people skills.

  • A great website with good story telling and marketing skills.

All of these are things you probably have in some measure today, but they are also things you can hone and increase over time. Everything else you think you might you need (like 500 years of experience) is overkill and probably secondary to these five things. And if you set a goal of making these things true in your business, then you have what it takes to be the premium service provider commanding the highest price in your market and there is a good chance if enough of this is already true of your business you could raise your rates 40%-50% today on all new clients and grandfather existing clients in and continue raising rates as your skills and the overall value you provide continue to increase. After all, only you can set your price, and only you can decide what your time is worth. So start the way you intend to finish and create a solid pricing strategy today!

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