EP 208: Pricing By The Numbers With Systems Saved Me Founder Jordan Gill
The Nitty-Gritty:
* How Jordan Gill used data and experience to set competitive prices for her business operations firm* Why she focused on serving seasonal service-based businesses and how that impacts the way she delivers her service* The stat she used to figure out a new way to offer her services* What expenses Jordan accounts for in pricing her unusual offer
Sometimes the numbers top you in your tracks.
It was the summer of 2017. I was on a bonus day of vacation with Sean and Lola because our original flight had gotten canceled.
We were on the way to Sean’s grandmother’s lake house and I thought I’d check in on my email quick since I’d be coming back to work a day later than planned.
Staring at me from the top of a stack of unopened emails was an email informing me that, soon, 30% of our membership revenue was going to flow toward Apple instead of our bank account.
My stomach sank.
The still-new community wasn’t even breaking even yet and now we were going to have to give up 30% of our revenue to the world’s richest company?
I panicked.
Luckily, even in my panic, I read through the email a few more times to check the—unbelievable—details. It turned out that Apple was going to take 30%—but only for memberships that originated in our app.
Okay, crisis averted. But in the time between my panic and realizing what was really going on, I had already started to concoct a plan.
My plan was simple: we needed a serious influx of new members to offset the potential hit to our revenue. So… get this… I decided to drastically reduce the price of membership from $60 per month to just $15.
Yes, that’s right, when faced with the potential loss of 30% of our revenue, I made a decision to lower our prices.
Hear me out: I thought that by lowering the price to something more akin to a piece of software you subscribe to, I could build our customer base by hundreds—if not thousands—while maintaining our current expenses.
This did not happen.
Instead, new members joined at about the same rate but with 75% less revenue coming our way.
It didn’t take long to realize that this was not working.
The numbers just didn’t add up.
Without an onslaught of new members at this lower rate, we were never going to be able to cover costs.
I’d made a big pricing mistake and something had to change.
Of course, it wasn’t just a matter of covering expenses. That’s an important part of pricing—and one we’ll get into the nitty-gritty of in this episode.
But price tells a story. While I was trying to tell a story about our community being as invaluable as one of the software tools you run your business with, the story we were really telling was just, “This is cheap.”
By raising the price, we could better reflect what we actually offer.
That’s another piece of the story we’re covering in today’s episode.
Meet Jordan Gill. Jordan runs a business operations firm and is the founder of Systems Saved Me, a hub for templates and online training designed to improve your business systems.
Jordan is adamant about running her business by the numbers.
The Nitty-Gritty:
* How Jordan Gill used data and experience to set competitive prices for her business operations firm* Why she focused on serving seasonal service-based businesses and how that impacts the way she delivers her service* The stat she used to figure out a new way to offer her services* What expenses Jordan accounts for in pricing her unusual offer
Sometimes the numbers top you in your tracks.
It was the summer of 2017. I was on a bonus day of vacation with Sean and Lola because our original flight had gotten canceled.
We were on the way to Sean’s grandmother’s lake house and I thought I’d check in on my email quick since I’d be coming back to work a day later than planned.
Staring at me from the top of a stack of unopened emails was an email informing me that, soon, 30% of our membership revenue was going to flow toward Apple instead of our bank account.
My stomach sank.
The still-new community wasn’t even breaking even yet and now we were going to have to give up 30% of our revenue to the world’s richest company?
I panicked.
Luckily, even in my panic, I read through the email a few more times to check the—unbelievable—details. It turned out that Apple was going to take 30%—but only for memberships that originated in our app.
Okay, crisis averted. But in the time between my panic and realizing what was really going on, I had already started to concoct a plan.
My plan was simple: we needed a serious influx of new members to offset the potential hit to our revenue. So… get this… I decided to drastically reduce the price of membership from $60 per month to just $15.
Yes, that’s right, when faced with the potential loss of 30% of our revenue, I made a decision to lower our prices.
Hear me out: I thought that by lowering the price to something more akin to a piece of software you subscribe to, I could build our customer base by hundreds—if not thousands—while maintaining our current expenses.
This did not happen.
Instead, new members joined at about the same rate but with 75% less revenue coming our way.
It didn’t take long to realize that this was not working.
The numbers just didn’t add up.
Without an onslaught of new members at this lower rate, we were never going to be able to cover costs.
I’d made a big pricing mistake and something had to change.
Of course, it wasn’t just a matter of covering expenses. That’s an important part of pricing—and one we’ll get into the nitty-gritty of in this episode.
But price tells a story. While I was trying to tell a story about our community being as invaluable as one of the software tools you run your business with, the story we were really telling was just, “This is cheap.”
By raising the price, we could better reflect what we actually offer.
That’s another piece of the story we’re covering in today’s episode.
Meet Jordan Gill. Jordan runs a business operations firm and is the founder of Systems Saved Me, a hub for templates and online training designed to improve your business systems.
Jordan is adamant about running her business by the numbers. ★ Support this podcast ★
