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The difference on how we respect things that are paid for, rather than given to us for free.

Transcription

The problem with free education.

H, I’m Brian Pombo, welcome back to Brian J. Pombo Live.

I’m not going to get political or philosophical with you on this question. But it’s an idea that can affect you and your business and how you view raising prices and things of that sort.

It came to me from reading the book Thinking Grow Rich by Napoleon Hill. And in it, he actually has a section in there. So this book goes back to it. 37 is when it was first published, and I’m reading the original version of it.

He discusses in there that there’s a reason why college education is so valued on many levels, and back then even more so than it is now.

He said that the one he can really pin it down to is that all the education up to a certain point is publicly funded, it’s free. There’s something about people that if something is free, they are not going to value it as much.

So having a high school education is not all that valuable. For one thing, it’s very common, most people have a high school education or an equivalent to it.

But also, it’s just not seen as highly recognized as a college education. And the more expensive college gets, the more valuable it is seen in many cases.

It’s kind of strange where we are at in the United States right now. Because right now you kind of have a lesser view of college education, while at the same time, they’re getting charged more and more.

So it doesn’t fit the dichotomy exactly, but if you look over time spread out over time, going back to 1937. And beyond, that, when you’ve got free education, free is not valued as much as something that’s worth more.

Now, the easier it is to get that thing, even if it’s worth more if it’s easy to get, that’s also an issue and it reduces the value of what it is.

So a lot of people have said, Hey, why don’t we, you know, just forgive all the college debt, right? You can forgive all the college debt, what if we just made it to where the federal government pays for college, like everyone, everyone gets a four-year degree, why not just everybody gets a four-year degree.

If you do that, you would highly, highly, highly discount the value that college brings. Everyone who is getting more, you’re seeing the same situation happening in inflation. If more people have more money, what it doesn’t mean that they have more money, it they have more paper have less value.

If you take something of value, and you spread it out all over and make it common, it becomes less valuable, is psychology here. But it’s also kind of the laws of the marketplace.

So if you have any form of marketplace free marketplace whatsoever, involved at all, this is going to occur, there’s no way to create equal full equalization across the board because the value is perceived in the fact that is it is unequal. Something is valuable when it’s less common.

As soon as you make something fully common, it’s less valuable. It’s a weird thing, it’s a weird thing to think about. But when you pull it back to your business, in terms of your business, if you have a lot of something and you are giving it away, people are going to value it less than something that you have a little bit of that you’re charging more for. Right, it’s the same I could be the same item.

If I took my book and all these things don’t have to it doesn’t mean you shouldn’t give things away. It doesn’t mean you shouldn’t offer things for free, but you have to keep in mind what comes along with that.

So for example, I give away my book every night here when we talk, I give away my book in digital format. 9 Ways to Amazon-Proof Your Business you can get a free copy. Like I say every night, you get a free copy at AmazonProofBook.com You can download a free copy.

Now just because I say that many of you will never do it because it’s free because it’s easy. Because you get it right on your phone is the simplest easiest thing in the world.

You are automatically going to value it less than if I took the same book same contents everything else.

I said, I only have 100 copies of this book. And once they are out there, they’re gone, I’d have no digital copies, I have only physical copies. This is secret information, I don’t want everyone using this information, because then it will, it will make it less valuable.

What if I say I’m only putting out 100 copies, and I’m gonna see what happens, and see how people react to it.

Because of that, I have to offer a higher price on it. So it’s, it’s a $200 book, there are people that do this, you understand there are people that do it. Now you’re going to have to spend more time being specific about the value that that book provides.

But I’ve bought $200 books before I know that it can be done if the information, if the information in there can make you 1000s of dollars, what’s $200, right?

Especially when you’re talking about that money is a really easy thing to be able to see if it actually is valuable. You can see that available when people have things like guarantees and other things involved money-back guarantees that can both add to that ability, but it can also take away from the value.

Because if you’re offering money back, all of a sudden, it’s like well, that that automatically gives you the idea that there are people that are going to buy that aren’t gonna like it. It decreases value at the same time but that’s another issue.

Understand that when you the price that you put on everything. And the amount of supply that you offer of anything creates the concept of value in somebody’s mind. So you just have to think about these things when you start going into the pricing game.

So a lot of great books out there. I talk about price strategy quite a lot here. So go back and watch or listen to other episodes where we talk about pricing. But it’s really interesting stuff. It all comes down to psychology and it’s not anything I don’t think you can get around, I think it’s built into the human psyche.

So hopefully that’s helpful to you.

That’s all I have for tonight. We’ll see you tomorrow. In the meantime, get out there and let the magic happen.