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Never compete on price

I walked into Kara Roberts office this afternoon and asked whether she wanted to work on something fun. Kara, who serves as LexBlog’s Client Development Director, responded with a “I need it. I just got off the phone with a lawyer who complained that LexBlog’s initial fee is twice as much as one of our competitors.”

My response? That’s right. Any business can compete on two of three fronts. Service. Quality. Price. But not all three. And I’ll take competing on outstanding service and quality of product over competing on price any day.

One because it’s the right thing to do when you’re looking to serve others. And two, because that’s what most people want – quality and service.

Doing a quick Google search I ran across an excellent article by Elizabeth Gordon sharing six reasons to never compete on price.

  • Don’t be afraid to charge what you are you worth.
  • People like paying for quality.
  • Take your focus off price and onto to value.
  • Put the emphasis on quality and service and the experience.
  • Use your price point to cultivate your niche.
  • Ask what you can do to add more value and listen.

I’d add at least one more. Don’t compete against someone who doesn’t care as much as you do.

In LexBlog’s case we’re doing all we can to make difference in our client’s lives and the people they serve. With most of our clients being lawyers and law firms, it’s critical that we do everything we can to uphold the integrity of our profession, and even improve the image of the legal profession.

Focusing on price, as opposed to quality and service, leaves the American lawyer ill-served. It’s not what companies serving lawyers should be all about.

Dad was right. “Work on having a product and service that accompanies it that you can proudly proclaim as being the best in the business. Never compete on price.”

  • http://www.svslawoffice.com Shawn Vogt Sween

    I think you’re exactly right. Thank you for the reminder that price isn’t everything that matters. As a relatively new solo, I have to keep reminding myself of this, because the concept of realistic pricing is ever in my mind as I speak with new clients. I want to be fair to both clients and myself, but I think I’ll continue to focus my efforts on outstanding quality and service.

  • http://www.calawreport.com John Corcoran

    Kevin:
    Bold statement. I think you have a good point about price. The problem is, there is always going to be someone else out there who will undercut you on price. It’s easy to compare prices, but not as easy to compare quality, which is more intangible.
    I just had lunch today with someone who was telling me about a criminal defense law firm in California that has gone around signing contracts with various counties by promising to delivery cheaper criminal defense work than the public defender’s office. My response was: he may get the work, but they’ll never get rich. It’s a race to the bottom.
    John Corcoran
    California Law Report
    http://www.calawreport.com

  • http://informationsecurityhq.com Mark

    Thanks for the great reminder that value is in the eye of the beholder so it is important not to under sell a valuable service. Meeting customer needs can be done through many methods and price is just one of the factors used in evaluating a product or service (and not always the most important one).

  • http://www.bathmarketingconsultancy.co.uk Paul Tagent

    Thanks Helen a very accurate and true article. In fact I wrote something very similar on my Blog – http://www.themarketingexpert.net/2010/08/money-money-money.html
    I see pricing as an area where clients can differentiate themselves and to “buy” business is something that can only do harm to a business.
    Keep up the good work!

  • http://www.realpractice.com Brad Cooper

    Thanks, Kevin. Good post. I think this is mostly right, except in cases where the competition is not doing well on all three. Southwest Airlines,for example does quite well on all three.