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Compete on price, differentiate or leave a saturated market?

by IrishEntrepreneur
13 replies
Good evening all,

I have quite an open question for the more seasoned marketers on the forum, on whether to compete or get out of what can only be described as a buyers market, where the buyers know it and seem to be fixated on price and barter before any other consideration (such as experience, qualifications, references).

The market specifically is 'English language classes/courses to individuals or company groups in Madrid, Spain' (though it could be applied to any major city in Europe, I'm using my current city as an example).

Madrid English Classes (home of student or online)

Madrid Private (individual) and Business Language Classes

If you take a look at the above links you will see basically the same service offered again and again at lower and lower prices - and I'm refusing to play that game.

It's an interesting market as the 'need' for languages already markets itself - and if you notice the ads no-one tries to sell the need, but they go straight for experience and (low) price ...

I have differentiated somewhat offering more than a simple €/hr transaction; offering:
  • level test and consultation
  • material (online or email pdf/mp3)
  • the class (Skype or in Madrid)
  • feedback email after class

I'm online (Facebook page and Twitter) and my own .com, offering free material weekly etc

but the conversation will always come back to price, with no question on how I teach etc

Time to find a new money maker?

Opinions?

--

To partly answer my own question, but I still need a lot of advice;

my 2nd option is to stop teaching/training 1:1 and groups at €/student/hour and focus on online courses.

I recently setup a recurring revenue subscription site (LMS) with a combination of Wordpress, Woothemes Sensei, Paypal, design from Fiverr etc and went to town with Facebook ads and I've had some register an interest. Creating the material is a MASSIVE time investment, but the + side is that I can now target English learners well outside of my current city, but that's a time investment decision I need to make soon.
#compete #differentiate #leave #market #price #saturated
  • Profile picture of the author savidge4
    An interesting situation to say the least. I think in regards to your offline teaching, price is a hurdle and it would seem to be one you are not getting over. There will ALWAYS be room in a market place for a higher price premium service. In your case this is teaching service. It would seem without actually seeing your "sales pitch", I can say based on what you are saying you are not selling the benefits of your service vs less expensive methods. WHY are you worth what you are asking? WHAT seperates you from the others? WHO would benefit from your services? and then the WHERE and WHEN I am sure you cover. These are the 5 "W's" of a good sales pitch ( web design in general ) there is also a "H" that goes in there... and that would be HOW your service will benefit the student.

    Regardless if you push further with the 1:1 teaching or develop an online class ( I would regardless of your decision go this way ) those 6 points are the basis to your success in an online sales platform.

    focus less on what you think is holding you back, and look more to what you can offer your clienmts.
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  • Profile picture of the author SirThomas
    You might want to specialize in the field. For example "English for business". Then you expand on what type of business or industries, like green technologies, heavy construction, engineering, medical etc

    You will attract different clientele and can demand higher fees than with generic audience.
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  • Profile picture of the author zoro
    You might want to setup your online course at Udemy, go where the people are already searching: https://www.udemy.com/

    Also, I think the post #3 by Sir Thomas is a very good way for you to differentiate and add value that the others can't be compared with.
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  • Profile picture of the author Jack Gordon
    I run an online course. It does quite well, but you are right - it was a massive time investment to set up. We spent about 18 months to do it right. We didn't go through Udemy - we used a combination of Wordpress, aMember and Moodle. This way, we own everything.

    Would I do it that way again? You bet your ass I would. This is the IM dream... an infinitely scalable product that lets us wake up to payments in our inbox every morning.

    I don't know what the competition is like for a course in your subject, but if it is not too brutal and you can differentiate yourself, I would highly suggest going that route.

    If nothing else, you have diversified. Also, once you are the talent in an online course, I'll bet your credibility (and price) as a live teacher go up, making it easier and more lucrative to teach both ways.
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  • Profile picture of the author misterme
    Originally Posted by IrishEntrepreneur View Post

    I have differentiated somewhat offering more than a simple €/hr transaction; offering:

    level test and consultation
    material (online or email pdf/mp3)
    the class (Skype or in Madrid)
    feedback email after class


    I'm online (Facebook page and Twitter) and my own .com, offering free material weekly etc

    but the conversation will always come back to price, with no question on how I teach etc

    Time to find a new money maker?

    Opinions?
    My somewhat educated hunch would be those differentiators don't mean much to whoever's seeing your marketing material. Drum up some better ones.

    Conversations, by the way, will always include price. They'll usually start that way too, because you can't expect to come in asking, "so tell me first, how well do you teach?"

    There's a difference between the person who calls and insistent about price and others who may call asking about price but who you can have a conversation that builds value first.

    If others are making money in this field then the answer is to do the same, not necessarily find another field. You'll probably face the same or similar issues in a new field.
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    • Profile picture of the author Jason Kanigan
      Originally Posted by misterme View Post

      My somewhat educated hunch would be those differentiators don't mean much to whoever's seeing your marketing material. Drum up some better ones.

      Conversations, by the way, will always include price. They'll usually start that way too, because you can't expect to come in asking, "so tell me first, how well do you teach?"

      There's a difference between the person who calls and insistent about price and others who may call asking about price but who you can have a conversation that builds value first.

      If others are making money in this field then the answer is to do the same, not necessarily find another field. You'll probably face the same or similar issues in a new field.
      I agree these differentiators don't amount to much, unfortunately.

      OP:

      Why not ask your CLIENTS what they value as a differentiator? You'll have to explain the term.

      Ask them what makes you stand out--why they chose you.

      Find these things out, then start broadcasting them to your target audience.

      Speaking of your target audience...I don't think you have one. Not one defined well enough. WHO are you wanting as a customer?

      Down-on-their-pennies Europe backpackers?

      Mid-level business managers with decent-paying JOBS and the desire to learn another language to help them get that promotion? (hint)

      World traveler moneybag types with the leisure time to devote to playing at learning their fifth or seventh tongue?

      Niche down and you can easily charge more.
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      • Profile picture of the author MRomeo09
        I'd also move the free line. What can you present in an hour that would blow their socks off? What kind of testimonials can you provide for them? How can you keep them engaged for an hour or so to create a ton of value and prove that you are the logical provider?

        What about a promotion like Free English Fridays, where for 30 minutes you tackle a small beginner issue. How to order food, or how to find directions, or how to check in at an airport, things like that. Record them and eventually you might have a few really good ones and you can have a "fake" free English Friday, that's pre-recorded.

        Create a youtube channel that has videos of you doing deep dives for 10 minutes or less on certain subjects.

        Then make your website very testimonial driven.

        Now when people ask you what the price is, you can tell them, why don't you first do one of our free classes, and then we can pick a course that works for you and for your budget.

        Then once they do free, try to get them to commit to a small purchase. I would suggest a series of introductory videos. Maybe 3-5 hours worth of material and charge a very nominal fee to get started- $9-19-29. Here's a trick, make all of the videos fairly short 12-20 minutes so that you can legitimately say you're offering 20+ videos on beginning English. Something stupid cheap, but to get them used to giving you money. This is called a tripwire(and somewhere out there Claude is smiling).

        Once you have them giving you money, and they've had you "selling to them" for 3-5 hours you are ready to offer them your main courses. Offer differing price points.

        The point is make the ability for them to start doing business with you as easy and as painless as possible, and then it becomes easier to ask for the next larger investment. Give away a lot of material to pump up your credibility. It will be worth the time investment.

        Try using Google Hangouts as well. It's more flexible for these type of arrangements than Skype.

        I agree with what everyone else has said, just trying to attack this from a different angle. How I would market it.

        For examples on how to do this- you'd probably have to invest in some rather expensive Dan Kennedy courses. I liked the Dan Kennedy and Bill Glazer- A to Z information marketing. And the tripwire information comes from Ryan Deiss.

        Good luck.
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        • Profile picture of the author DABK
          Like MRomeo says, you need different price points.

          Like others have said, you need to specialize... Or, better yet, have various specialties available.

          I looked at the ads in one of your links... They all do the same, assume people want to learn English because they want to learn English.

          When you specialize, you automatically address at least one of their reasons. But not all.

          You could create courses that address various reasons.

          Some people want to get by, some need to achieve near-native fluency. Their reasons for the same want are different, which means the investment they're willing to make are different.

          Once upon a time I studied Russian, to impress a shapely red-head lady. I was a broke student, so I did it on my own.

          At the same time, I knew of a guy who needed, in order to get his PH D in French to demonstrate a certain level of Spanish fluency. He was just about as broke as me, yet he found a couple hundred dollars to spend on a native speaker to practice his rusty Spanish on.

          At the same time, a doctor friend of a friend was moving to Italy for a business venture. He had studied Italian ages before, could get by. But he needed to do more than get by... He needed to communicate his business ideas... He found thousands of dollars to hire a University Lecturer...

          So, differentiate. Create products that appeal to various reasons. And, for each reason, have a $7 product,a $47 product, a $2977 product...

          You know, Dan Kennedy gets people to attend his $1k+ seminars from free newsletters and $9 books, via $49 a month subscription newsletter, $199 cd/videos, etc.

          You could do something similar in your field.

          Yes, yes, speaking English fluently is the same. But see again the above.

          And go after people who need to learn for business reasons... They're the ones who, at least in my part of the world, are the ones willing to part with more money for higher quality and/or longer time commitment.

          By the way, make yourself a celebrity... Or offer group classes where you make it cool / fun to be a member.

          Check out Alliance Francaise in Chicago... Yes, they're established, have lots of money compared to most language teachers... But they have a lot of things that make them a cultural center... They started out a long time ago with language lessons...
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  • Profile picture of the author misshang
    Being in the same business, I have my 2 cents to share. This business is seldom marketing online properly, try to rank your site for certain money keywords, re-modeled a better site design and raise your price.
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  • Profile picture of the author JessUBotNinja
    Who is your focus on? Perhaps you can alter who you are targeting? Try marketing to businesses with offices or partner companies in English speaking countries. You could try to get info into their break rooms or offer group lessons. Perhaps you can offer some seminar type classes with the intent on continuing their studies through online program? Try offering to business organizations -- do lots of small local business owners congregate anywhere that you can sell them a group session or say 5+ individual lessons at a discounted rate?
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    • Profile picture of the author Dave Espino
      By offering your courses on Udemy, you not only expand the number of people who can access your training, but you also open up potential opportunities to expose your current offline business to new opportunities.

      For example, back in 2000-ish, I published tons of articles about eBay.

      It is because of this intense online presence, that I was "discovered" by an infomercial company and eventually was able to sell over $140 M of my own products on TV.

      Had it not been for that additional exposure that I worked to build, I may not have been "found" by that company.

      In the same way, Udemy courses are often a place where people are searching, not only for courses that they can consume, but some people are on there looking for experts that they can do business with - outside of Udemy.

      Besides, the ongoing, passive income from course sales is good, too!

      Dave
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  • Profile picture of the author IrishEntrepreneur
    So thank you all for the replies and my apologies for not mentioning so earlier. Have been busy (the good kind) and did implement some of the advice.

    I now have a solid base of classes lined up for January with business clients, as a language service provider for 3 employee groups. It's amazing how a change in terminology (and value proposition), from teacher/tutor to Communications Coach or Foreign Language Trainer + changes to brochures etc to reflect this can pique interest in markets more at home with this lingo.

    So I took, now want to give, so if anyone has questions on the world of B2B Language teaching, processes, product offers that work (in my so far limited experience), please let me know.
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    • Profile picture of the author DABK
      Glad to hear you made changes and it's working out well for you.

      Originally Posted by IrishEntrepreneur View Post

      So thank you all for the replies and my apologies for not mentioning so earlier. Have been busy (the good kind) and did implement some of the advice.

      I now have a solid base of classes lined up for January with business clients, as a language service provider for 3 employee groups. It's amazing how a change in terminology (and value proposition), from teacher/tutor to Communications Coach or Foreign Language Trainer + changes to brochures etc to reflect this can pique interest in markets more at home with this lingo.

      So I took, now want to give, so if anyone has questions on the world of B2B Language teaching, processes, product offers that work (in my so far limited experience), please let me know.
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