Do you have a Premium Version?

I was reading the September 5th issue of the Wall Street Journal and came across an article on how Procter & Gamble have been introducing premium versions of their products, some at significant (greater then 50%) price increases over their normal counterparts. That lead me to thinking, do you have a premium product or service? If P&G can sell a premium version of paper towels at higher prices, you can certainly do it in your business!

There are many reasons and strategies for having a premium level of your products and services, but the biggest is that there are always some buyers that want the premium package no matter what. If you don't offer them one,  they will be disappointed. So give them what they really want! Premium products should not cost nearly as much as the increase in price, that is they have a higher profit margin. Do you think that P&Gs Bounty DuraTowel actually costs 20% more to make, equal to the 20% more it is priced? You can count on not.

Another strategy is to use the super-premium level as a way to compel your prospects to take the level you really want them to take, next level down.

Say you have three levels of your service product (Bronze, Silver, & Gold). And you really want your customers to be at the Gold level. That is the level that has the best mix of services to them and profit to you. One way to get more people to choose the Gold package is to add a Platinum level. That package provides some desirable benefits to the the customer, costs you little additional to deliver the additions, but you price it significantly higher. Many will say, "I would really like to be in the Platinum program, but it is just too expensive. So, I'll sign up for Gold." Exactly what you wanted in the first place. And if you get a few in Platinum, then deliver it and get a healthy margin for doing it.

Premium levels give your clients more of what they want and need, and you more of what you want and need. A win all around!