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Trying to justify higher prices than your competition is a constant struggle, isn’t it?

You lose business when competitors find ways to charge far less for their services.

If your business model won’t support a competitive pricing strategy and you’re struggling to justify higher prices to your customers, then you’ll love today’s post:

4 smart strategies to justify higher prices and win your company new business.

Ready to learn more? Let’s get started.

#1. Uncover Where Competitors are Cutting Corners

Competitors lower prices by reducing spend in other critical areas of their business.

Cost savings may entice customers in your target market to choose a competitor over your company, but remember this age-old adage:

You get what you pay for.

Uncovering and exploiting where competitors cut corners opens up an opportunity to address customer pain points and position your business as the silver bullet.

In a 2015 blog post, Martin Smith, Managing Director of Bid Solutions, a bid and proposal consultancy, instructs companies to cast doubt in the minds of potential customers by first highlighting where competitors are cutting corners and why your company chose not to do the same.

“[Describe] how [cost saving solutions] were first considered and then eliminated, explaining the risks and giving the reasons why an alternative solution was considered preferable. If you expect a potential competitor to offer a low-cost solution, draw attention to how the potential risks of their solution significantly outweigh any apparent cost benefits.”

AGJ Systems, an IT support company based in Mississippi, do that exactly on their website.


AGJ addresses a common pain point in their industry: slow response times.

Positioning themselves as the go-to solution for faster responses could allow AGJ to justify higher prices for customers frustrated with the slow response times of their cost-cutting competitors.

How Do I Uncover Where Competitors are Cutting Corners?

  • Survey current and potential customers.

Whether through an inquiry form, mailing list or informal polling during discovery calls, talking with your current and potential future customers about previous struggles with IT service providers could uncover a competitive advantage.

  • Be active in your local community.

Get out and talk with your local community of business owners and entrepreneurs. Join business-minded groups like Rotary or attend local town halls to network.

  • Engage with your online community.

Play an active role across social media channels to stay in-tune with customer complaints and success stories. Don’t be a lurker – be a part of the community by sharing your own insights and responding to threads where you can add value.

#2. Use Data to Clearly Demonstrate Your Value

When it comes to demonstrating value and justifying higher prices, data can act as an irrefutable source of return on investment.

But, you need to know what kind of data is important to your customer.

That’s why it’s important to ask clients how they define ‘success’ as it relates to your partnership.

You may think you know the impact your company will have on a client’s business, but as author and entrepreneur Anthony Iannarino wrote on the Salesforce blog, service providers should be questioning whether the value they’re proposing is “compelling” enough to justify higher prices and land a deal:

“Are you solving the biggest, nastiest challenges your clients are facing? Are you helping them with their most strategic opportunities? Are you helping them create a gap between them and their closest competitor?”

First, understand what is most important to a client and the metrics they are using to measure progress toward those goals.

Second, use those metrics to align your value with the client’s big goals and definition of ‘success’.

Third, track progress through KPIs, consistently report on progress and reiterate return on investment.

IBM’s Integrated Managed Infrastructure services arm understands the importance of quantifying return on investment to justify cost.

In a 2013 white paper published by IDC, the following chart and graph were included as an example of how the company tracks and reports on ROI.


IBM shows time and money saved as a measure of ROI and means to justify higher prices.

#3. Establish Your Reputation through Thought Leadership

Being known as the go-to source for expert-level thought leadership in your industry commands a higher price tag on your services.

Jayson Demers, CEO and Co-Founder of AudienceBloom,  puts it nicely in a post on

“Thought leaders are popular, well respected and connected enough to drive real value to their respective businesses. They’re charismatic institutions, revered both by customers and workers within the industry.”

Therefore, if you need to justify higher prices, focus on establishing a reputation as a thought leader with the following approaches:

  • Publish on LinkedIn.

LinkedIn has over 490 million members as of this post, most of which are leveraging the network for industry trends and expertise. Publishing on the platform is free and open to anyone with the potential to go ‘viral’ always just one “Like” or comment away.

  • Start a blog.

Develop a content marketing strategy aimed at driving traffic to your website through a blog.

  • Engage with influencers.

Contact industry influencers and ask them to guest post on your blog, do an interview, or simply share a link to your content through social channels.

#4. (Almost) Always Say “No” to Negotiation

Part of having higher prices is confidently standing behind those prices when clients inevitably attempt to negotiate a lower, more competitive rate.

If you’re quick to offer lower prices, you’re devaluing your service.

Again, author and entrepreneur Anthony Iannarino summarized this idea nicely:

“The real business objectives your clients need help with aren’t easily obtained or some crafty sales organization would’ve already figured out how to do so at the lower price they promised. The differences that make a difference for your clients should cost more. In fact, they must cost more if you are to execute and produce results.”

When is it Appropriate to Make Concessions?

When the client has “earned” them.

Good examples include service bundles and volume discounts. If a customer is willing to go “all-in” on your company’s services, offering a discount helps both sides of the negotiation feel like they’ve won.

Check out the chart below.

If your customer’s “driver for change” is to negotiate the best possible deal for their company and your “desired outcome” is a new customer, negotiation can often help both sides achieve their objectives.

It’s when they are employed apologetically for your company’s higher prices that negotiation becomes a problem.


In the increasingly competitive IT-services space, businesses will always be looking for ways to scale back pricing and be the most cost-effective option on the market.

These 4 strategies were designed to help you anchor high with confidence in your pricing strategy. Start implementing these ideas today to justify high prices to clients in your market.