Let's STOP "Charge What You're Worth" Pricing Culture

May 31, 2022 Katie Scott

"Girl, you've gotta raise your rates! Double your prices! Charge what you're worth!!"

You've heard it, I've heard it, many of us have probably said it. It's easy to see why. It's a catchy saying that makes you feel good! Who wouldn't want to buy into that message? I know I wanted to.

I've learned a lot about money over the years since I started working on my own financial literacy. Even more so since I started teaching others about money, ironically. But I'll admit that learning about the mindset of money was always something I skirted around.

Probably because I knew how important it is, and how challenging it can be to face.

But this past year, I’ve started to think and learn more about how we think about money and what our relationships with money should look like. And the more I learned, the more I realized just how toxic "Charge What You're Worth" culture really is.

Side note to the skeptics: I recognize that this sounds like an argument over semantics. I can already hear the counterargument that "Charge What You're Worth" doesn't mean putting a price tag on a human value, it's just a simple way of summarizing all your skills and experiences!

But I believe that "Charge What You're Worth" itself is just the slogan of a much more harmful pricing culture. So bear with me for the remainder of this post, and maybe you'll start to see where I'm coming from.

Problems Caused by "Charge What You're Worth"

The ripple effect of a distorted perspective is far-reaching and immeasurable. When your lens is wrong, everything else starts to look wrong too. This is certainly still true when it comes to the "Charge What You're Worth" culture that exists prevalently in the online business space.

I do have to say that I don't believe this was intentional. As I said at the beginning of this post, it's a fun, simple, feel-good statement that sounds like it could create positive change! It's a complete pendulum swing away from the equally problematic condition of women undervaluing themselves and their businesses.

But, as it often does, the pendulum has swung a bit too far, and it's causing new problems.

>> "Charge What You're Worth" Ignores the Reality of the Market

Here's a reality check. Your pricing will only help your business as long as there's a market willing and able to pay that price. Your expertise might be worth thousands, but if you're trying to use it to serve low-income buyers, good luck.

Your pricing should start with an educated understanding of the market and industry you're selling in. You don't have to be obsessive about it, but you should at least be aware.

If you're in that stage where you're not sure if you're supposed to charge $50, $500, or $5,000 for your product idea, then you've got some research to do. Market research that factors in the budgets of your ideal audience and a quick analysis of comparable products should give you a ballpark range for your price point.

Once you're informed by that, then you can start factoring in the value you're providing to arrive at a price.

Notably, the value you're providing has nothing to do with your personal worth. It has everything to do with the PRODUCT or SERVICE you've created and what goes into creating it. Actual costs to create it, your time, your experience and skillset, the results and transformation customers/clients will receive, etc. All of that has a price. You are priceless. But we'll get back to that later.

While this culture does ignore the reality of the market, it still has an impact on the market. If everyone starts following this logic, it starts to inflate prices. It creates new expectations. If the new prices aren't backed by value, it creates consumer distrust. (Don't think that can happen? Look at the Used Car Salesman stereotype. I’m sure there are plenty of well-meaning car salesmen out there who have to fight constantly to overcome consumer distrust.) And it changes the standards for new women entrepreneurs trying to start the same business with less experience. Ripple effect.

>> "Charge What You're Worth" Gives Rise to Arbitrary High-End Pricing

I actually prompted some of my Instagram followers to discuss this topic with me a couple of weeks before writing this post. Something that came up a few different times in my DMs was the observation that many in the online business space have used "Charge What You're Worth" as an excuse to justify charging high-end rates just because.

Have you ever been burned by a "premium price point" that didn't deliver on its promised value? Many, many have.

I'll even raise my hand here. I was told to raise my prices for my coaching packages way before I had the experience to back it up. I don't blame the coach, I think she simply didn't have a good enough understanding of how new I was back then.

Regardless, the couple of times I did book a client at those rates (before lowering them), I was painfully aware that I had to really step it up to justify what I was being paid. I moved mountains for those clients, at great cost to my own sanity, because I was afraid they'd realize just how not ready I was for that price point.

One could argue this was a good way to push me out of my comfort zone. But I don't think this is a healthy approach to growing a business AT ALL. While I'm thankful for the push now, if I could do it again, I'd do it very differently. To this day, my prices are still lower than what they were because now I look objectively at the value I provide and the market I'm serving.

"Somewhere along the way in pricing culture, we’ve glommed onto the idea that being in our very presence is worth thousands because… we say it is."

- Hillary Weis (Medium Article)

What are you worth? $5k? $10k? $30k? Are your prices simply connected to today's self-esteem levels?

You are a valuable, amazing human being. There is no price tag that can be attached to your worth. Unfortunately, that also means that you don't get to charge a premium just because you're you.

You charge a premium when you have a provable promise of a premium transformation. Your price has to be backed by real value and the reality is that not everyone can provide the same level of value right away. But you can work towards it!

>> "Charge What You're Worth" Disregards the "Worth" of the People Who Need You

When we give pep talks to online business owners about charging their worth and upping their prices, you hear all sorts of encouragements like,

"Charge high-end prices and you'll attract high-end clients!"
"If they're not ready to invest at that level, they're not your ideal client."
"Clients/customers who won't pay what you're worth aren't worth your time and energy!"

Have you ever nodded along to one of these statements? Taken comfort in them? Used them to try and overcome your fears and reservations around raising prices? I know I have.

I want you to imagine something with me real quick. I want you to imagine sitting face-to-face (virtual or otherwise) with a potential client or customer. This will be even better if you can pull up a real face and name of someone you've spoken with in the past.

You're talking about your offer, she's interested in what it can do for her, she seems like a good fit, and so you tell her the price. She thinks for a moment and admits to you that she can't afford your price point right now, so she won't be able to buy today.

We'll also assume that you did the typical "sales call" thing and tried to identify if she was simply afraid of committing or if it was actually a budget problem. Spoiler, it's a budget problem. She doesn't have the money right now.

So you look her in the eye and say, "That's okay, it wasn't meant to be. No, don't apologize! If you can't afford my price then you must not be my ideal client. It'd be a waste of time if you can't be committed."

I don't know about you, but just writing that fake conversation makes my stomach turn. Obviously, few of us would ever actually say that. But what does that say if you're constantly thinking these things about people who simply don't have a big enough wallet? Or people who are simply trying to be responsible with their money during a certain season in their life?

I'll come out and say it because this makes me really fired up: Who do you think you are to say or think that about another person???

Yes, there are cheapskates out there who want to take advantage of your offers. Identify it for what it is and move on. But do not take a few bad experiences and start making blanket generalizations that diminish the worth of another human being just because they don't have as much money as you think they should.

"Just because you can charge $12,000 a day for coaching and someone will pay it, doesn’t mean you should. Can you actually count on getting that client back the $12k in ROI because you’ve done it for others? Do you have actual data that shows your track record of results? Because if not, you’re taking advantage of them.

Or did you give yourself a pep talk in the mirror, text your best gal pal, and then decide: What the hell — I’ll see if they’ll pay it?

Just because people will pay doesn’t mean they should have to. Owning a business isn’t about making the most amount of money in the least amount of time.

It’s about helping people WIN by sharing your expertise. Sometimes that expertise warrants higher price points, but sometimes you’ve just got to chill and stop being such a goddamn diva."

-Jess Manuszak (Medium Article)

>> "Charge What You're Worth" Creates a Toxic View of Self-Worthiness

I debated having this point right at the top because, in my opinion, it's one of the WORST side effects of this pricing culture. But I found it to be more effective following my angry rant above.

A human being's worth has nothing to do with money. I think I made that clear above when talking about your "ideal clients and customers." But now let's talk about you.

If you start to get it in your head that your pricing reflects your worth, you're going to start having a lot of comparison problems. You're now going to have a quantifiable way to determine if you're a failure or not.

Do you charge $1k for building a website? Well, you just found Janine's business, and she charges $6k for a website. What does that say about your worth?

(Spoiler: NOTHING. But it won't feel like nothing if your head's not on straight!)

I'm not going to name names, but there's a very popular money mindset teacher out there who wrote about how your income level is a reflection of how much you love yourself. The goal is to help you see that you should strive to earn more and build wealth. But, as you may have guessed, I'm not a fan of this teaching.

Sure, I want to build wealth. I talk about it all the time on this site.

But what happens when I decide I'm content with my income level and would rather focus my time and energy on being with my family, rather than scaling my business? What happens when my husband and I feel we're on track to having enough and so we shift our focus away from working and more towards living out our callings and serving the people around us?

I don't even mean that as a "what if" because this is actually our dream for our future. I don't want limitless income. Not because I'm afraid of it or I've convinced myself it's evil. Simply because I know I won't need it to be happy and live out my particular purpose in life. Can the specifics of this vision change? Sure. But the principle remains.

So if I cap out over here at ‘X’ but my best friend keeps scaling her business to ‘Y’ because her dream looks a little different, does that mean I don't have as much love, self-respect, or inherent value as she does?

I think you know the answer to that by now.

And one more note on this. I teach people to regain control of their money. To tell it where to go instead of wondering where it went. To create a proactive money management system and plan.

All that said, a lot of what will happen to your finances is out of your control. Emergencies will crop up. Life changes will need to be made. And sometimes, our society and systems are just straight-up against your financial success and you’ll need juuust the right set of circumstances to finally get your footing. This is reality.

And so if your sense of self-worth, happiness, contentment, security, or whatever is entirely dependent on your finances, you're going to have a very hard time coping with life's changes and curveballs.

>> "Charge What You're Worth" Fuels Selling Anxieties & Insecurities

Bouncing back to my story before about my hastily raised prices for my coaching services back in the day...

I mentioned that I had a couple of clients who did book at that rate. I was terrified to work with them. Not a great way to enter a client relationship.

But now let's talk about all the discovery calls I flubbed and leads I lost because I was terrified to work with them.

You could give me all the pep talks and inspirational quotes in script fonts that you could muster. The fact remained that I knew, deep down, that my offers weren't worth the price point I was charging. If I didn't believe in my own offers, how could I convince anyone else to believe in them?

I couldn't even properly tell you how I landed the clients that I did. Divine intervention, probably.

Again, I needed to be stretched. I was severely undervaluing my offers prior to all of this. But because there's another human being involved in this, I really don't believe the best way to overcome that block is by throwing yourself into the “High-End Deep-End.”

In fact, I'm actually a bit scarred by this experience. I developed such a strong anxiety around "being a fraud" and charging high prices that I now worry way more than I did before about whether or not I'm overcharging.

"Charge What You're Worth" culture seems to think that your pricing comfort zone is an illusion you've built for yourself. You're tentatively stretching out a foot past the line only to find that you're not on a cliff - you're just on a staircase! All you have to do is walk up it!

I believe the cliff is there. Because you have a market of real human beings with real budgets, there's a ledge you can't cross. Want to charge higher prices? Find a different cliff (market) with a different ledge (budget).

Raising your prices should feel like tiptoeing at the edges of your comfort zone. You really do need to overcome that problem of undervaluing what your offers are worth. And that's going to be a bit uncomfortable as you work your way there. But if you leap too far forward you might just find yourself where I was - a bundle of anxiety and insecurity falling off a cliff (and certainly not selling enough of your offers.)

>> "Charge What You're Worth" Idolizes Financial Success

Last, but not least, and probably not even last: we've got to stop idolizing false definitions of success.

The online business world quite literally worships the 6, 7, even 8-figure dream. To the point that I've had conversations with women who feel legitimately ashamed that they didn't feel like they wanted those higher revenue numbers. They were actually trying to manufacture dreams to fit someone else’s expectations. Uhm, back up.

Not everyone needs or wants to earn that kind of money with their business. Not everyone wants to quit their 9-5. Not everyone wants to be a millionaire. So let's stop assuming that this is what everyone wants. It ain't.

And it's okay.

Could it be a limiting belief? A fear of wealth? A lack of faith in their own abilities to grow? Yes, yes it could.

But it might not be.

You and I don't get to decide what it is or isn't for other people. We can have conversations, ask challenging questions, and support and encourage each other. But if someone arrives at the conclusion that THAT simply isn't their dream, let it be.

I use the term financial success in places. It has applicable uses! But I do not want that to be distorted into a message that success depends on your finances. As we discussed earlier, a lot of your financial condition is going to be out of your control. You will experience seasons, changes, emergencies, obstacles, etc.

If you have to have a certain number in the bank to feel like a success, it's going to be way too easy for life to make you look like a failure.

So what is "success" supposed to look like? Personally, I believe the replacement for "being successful" should simply be "living out your calling." If you're doing what you're meant to be doing, you're doing something right. Obviously, we could dive into this a lot more, but that's a million-word-long-post for another time.

A New Perspective

Phew! That's a lot of negativity, huh? So let's turn it around, because there is hope. More people are starting to come to this same conclusion about the toxicity of our current pricing culture, and more conversations are happening. At the bottom of this page, I've linked to some articles if you'd like some further reading!

But before you go, let's talk about how to start shifting our mindset around pricing and finances in general.

>> "Charge What Your Transformation Is Worth"

Here's the obvious change: stop saying "Charge What You're Worth." Despite my negativity around the prevalence of the saying, I have seen alternatives here and there:

"Charge what the work is worth."

"Charge according to the full value of your offer." (Tangible and intangible!)

Or, my personal substitute of choice: "Charge What Your Transformation Is Worth"

Because the offers you have in your business, whether products or services, should offer a transformation to your people, yes? It could be tangible, like something measurable, intangible, like something emotional, or a bit of both. It could look a lot of different ways. So what is that worth?

Remember to take my earlier advice about market research and awareness. You have to take into consideration the fact that this is an exchange between two parties. So don't just think about yourself in this equation. Think about the client or customer on the other side.

>> Allow yourself to ease into it

If you haven't taken the time or energy to do some deep work on your mindset around pricing, chances are you're undervaluing your offers. It just seems to be the way it is.

But you know what? I think proving the value of your transformation to yourself is just a part of the journey. And that'll take time and practice. It's okay if it's a slow process.

You don't have to go from $50 to $200 for 60-minute sessions overnight if you're still new at this. Been there, done that, I'll save you time, it doesn't work.

Instead, start to develop an eye for objective measures of your offers' worth. Look for the results. The testimonials. Your own skillset improving. Your increased efficiency. A new feature you added. A revamp. A long waitlist. High demand. Your new credentials.

Look for those things. Write them down. When you can see them, you can make the move to bump up your prices. Stretch your comfort zone a little, but (A) only if you have a reason to and (B) without tumbling off the ledge like a fool (like I did.)

It can and should take time to gradually raise your prices.

>> Create a better relationship with money

Have you been leaning on unrealistic expectations of money, income, and financial success for your happiness?

Let me tell you a secret: You're allowed to be happy today. Right now.

You can be dirt poor and struggling to book a single client and still be happy. You can and you should.

I'm not saying it's easy. I'm not saying I know all the secrets to making that happen. I, too, struggle with depression, and contentment, and frustration with my situation. I’m a consistent sucker for the green grass on the other side. It’s actually embarrassing how much I fall for that.

It takes a continuous, conscious effort to let go of my desire for more and/or something different and learn to just be grateful for where I am today. To simply be present and happy now.

But boy does it make a difference with the pressures you place on yourself when it comes to your financial goals.

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