When Sara Blakey launched Spanx (now a billion dollar company), she decided to price her new-to-market pants higher than her competitors. She felt they’d stand out that way, rather than disappearing amongst other cheaper pants.
She was offering quality, and wanted this reflected in the price.
But she’d also had experience in sales before. She’d been selling fax machines door-to-door. No one had heard of Dax, the fax machines she was selling, so they were all buying Canon fax machines instead.
She tried to go in cheaper; to make Dax the affordable brand. No one bought them. She made them the same price as Canon. Still, everyone stuck with the brand they knew. Then she priced them higher and people took notice.
Now, people were thinking: what makes the Dax more expensive; what can it do that Canon can’t? And it gave her an opportunity to extol the virtues of the Dax fax machine. She started making sales.
And so Sara applied this same theory when she launched Spanx. She wanted people thinking: but why are they more expensive? They must be better than the other pants.
One of the first challenges you face, when launching a Substack, is how to price a paid subscription.
There’s a question of the value you’re offering. What do you hope readers will gain from your writing? Will you offer something on top, like co-writing or workshops?
But also: it’s about how you want to be perceived: are you the affordable, accessible writer? Or are you more exclusive?
Perhaps you want to sit in the middle of these two.
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