Owner-itis
Owner-itis has afflicted many entrepreneurs in their time. It strikes young and old alike and can occur at anytime. It can also affect both rookies and business veterans. The malady is rarely solved without the help of a skilled and trusted business advisor. The reason? Whereas its symptoms are easy to diagnose, it is rarely associated with the systemic problem that causes it.
It is true that many who have the disease don’t really know that they have it. However, once diagnosed by a skilled and trusted business advisor, the patient (business owner) is remarkably relieved to learn that a variety of ills can be traced to its source and, God willing, be summarily cured.
The Physician
Blue Elevator™ is pleased to help identify and cure owner-itis. We have both the skill and the caring hands to gently and delicately find the ailment. However, its treatment requires an aggressive treatment continuum if the patient (business owner) and his or her business is to be saved.
What is the Main Malady?
Many businesses are done before they even start because their pricing is too low.
Owner-itis is a Blue Elevator™ term for a conundrum we have observed over the years. Here is our definition.
Owner-itis is the tendency whereby business owners feel pressure to unnecessarily discount their offerings. This usually occurs for one of three reasons:
- a lack of entrepreneurial confidence,
- an attempt to “buy” engagement from would-be customers,
- and an attempt to improve value by lowering price.
Pricing Concerns
Yep. We wish we had a dollar for all of the business owners we’ve encountered who haven’t or don’t feel the gravitational pull to lower their price in an attempt to get the phones to ring. So, the tendency is to want to put things “on sale,” so to speak.
The trouble is, since everyone wants to continue to grow, this initial desire to put things on sale becomes a pattern of engagement. The secret thought is this:
Since I lowered the price and I got X new customers, I wonder how many more customers I would get if I lowered the price even more? This thought becomes a pricing pattern. And, once established, it becomes an almost inescapable gravitational pull of a death spiral.
Fundamentally, this “transactional” approach further complicates things as it is Blue Elevator™’s belief that business is a relational proposition. Ask us for our article: “The Relational Business.”
A Funny Illustration
I remember hearing a story many years ago. Since all I remember is the punch line, I’ll make up the rest.
A tomato farmer encountered a savvy customer in the market one day. When the unsuspecting savvy shopper walked by, the farmer shouted out: “Tomatoes for sale: 50 cents a piece or $5.00 per dozen.” The savvy shopper did the quick math. Certainly, $5.00 for 12 is a better deal than $6.00 for 12 (e.g., 12 x 50 cents).
So, the savvy shopper, realizing that quantity discounts were in play, asked the farmer this: How much if I buy 3 dozen? Realizing that he might have a sale, and also admittedly having initiated the pricing protocol himself, the farmer felt both optimistic and obligated to continue along. So, the quick thinking farmer shouted out: “For 3 dozen, it’s $4.00 per dozen.”
Again, quick math on the part of the savvy shopper, held that tomatoes could now be had for 33 cents each (e.g., 3 dozen x $4.00 = $12.00 divided by 12 x 3 = 36).
To finish the story, and make the belabored point, the savvy shopper finally asked the farmer, “How many do I have to buy until each tomato is free?”
Why the Problem?
So, do you think you might have owner-itis? Do you feel that you can’t charge what you’d like? Do you feel the pressure of tight margins in your business?
If this sounds like you, then one or more of the following could be an issue:
- the market might not value your offerings (ask for our article “Build a Deliverable for Business Success“).
- you might need to improve the quality of what you offer.
- you might need to Innovate™ your offering.
We’re Happy to Help
Blue Elevator™ is skilled at helping to diagnose and solve owner-itis. All of the aforementioned can be addressed. We would love to help you do it.
And so, if your marketing plan consists of a continual regimen of price drops and price lowering sales, we would love to help you. Contact us!
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About the Author:
Ken Moll is the Principal and Founder of Blue Elevator®. With professional experience spanning four decades, Ken has a breadth of foundational business knowledge rarely found – making him part of an elite class of professionals. Ken's passion is helping clients of Blue Elevator® get their “business to the next level™.”