When an entrepreneur complains that they aren’t making enough money, I offer them the fastest solution to their problem:

“Raise your prices. Double them, if possible.”

As a consumer, you might bristle at that blunt advice. But as an entrepreneur, you need to really think about this. It’s a beautiful solution to cash flow problems, but it takes a smart marketing strategy and great fulfillment to pull it off.

Sure, many companies are already at or very near their pricing cap. But most companies are not.

(For those, who’ve “bristled”…trust me there will never be a shortage of high-quality, lower cost providers of everything and anything you need.)

So, how do you pull your product up from being just an average, standard priced product or service, into the premium-price category?

And what if your product or service is just another low priced commodity in a highly competitive market? That makes this strategy impossible, right?

Not at all.

There are several examples of low-cost “commodities” who have mastered the methods of premium pricing. And there’s a wide range of examples of mid-level and high-level products and services who demand premium pricing as well. Consider these:

You can get music online for free, but millions choose to pay for it on iTunes.

You can buy perfectly presentable clothes at Target, but millions insist on Abercrombie & Fitch.

You can make great coffee at home, but millions demand Starbuck’s.

You can purchase a Saturn, but millions indulge in a BMW.

There are several tactics that can be used to move your pricing into the premium category. I came across a good example of how Starbucks pulls it off…

Bryant Simon of Temple University presents an entertaining look at the techniques used by Starbucks. He explains (In the first 9 minutes) that there are three key elements at work that drive Starbuck’s premium pricing. I think these can be implemented on some level, to any product or service:

1. Functional–Starbucks is basically a caffeine delivery service…

2. Emotional–Starbucks creates a sense of “belonging”…

3. Expressive–Starbucks lets you say, “I can afford luxury”…

Take a look at his presentation. I found what I needed in the first 9 minutes, but the whole presentation is worthwhile.

I’d encourage you to consider how you can implement the same strategies used by companies like Starbucks to effect your pricing strategy.

I mean it when I offer this advice:

“Raise your prices. Double them, if possible.”

Check out these great blog posts for more information on this topic:

Don’t Be Afraid To Raise Your Prices

How To Raise Your Rates Without Losing Clients