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Pricing & Positioning

Sara Blakely

Lesson time 12:45 min

Pricing is one of the most important components of a business. Sara offers tips for aspiring entrepreneurs on how to create perceived value, develop distribution plans, and navigate discount strategies.

Sara Blakely
Teaches Self-Made Entrepreneurship
Spanx founder Sara Blakely teaches you bootstrapping tactics and her approach to inventing, selling, and marketing products that consumers love.


[MUSIC PLAYING] - Whenever you're developing a product, the goal is to catch lightning in a bottle. And I call it the four P's. It's got to be the right product. It has to be the right price. It has to be the right placement, meaning your distribution of it. And it's got to be the right positioning-- the naming of the product and the packaging. Those four things are what makes the lightning in a bottle. And when you capture lightning in a bottle, it's a home run, and you'll know it. But a lot of times, people blame just the product. And it's not always the product's fault. You might have an amazing product. There have been so many times at SPANX that we launch something. And it didn't do great. And I'm thinking, I still believe in that product. And the team will say that product was great. A lot of times it's, it's just that we, we put it out in the marketplace at not the right price. And then we change the price a few years later, and it becomes one of our best sellers. So check in with those four, the four P's, and catch lightning in a bottle when you're developing a product. [MUSIC PLAYING] Pricing a product is an interesting part of the journey as an entrepreneur or pricing your service. I'll share with you a story that's part of my journey. And that was I sold fax machines. And my product's name was DEX. And I was having to go up against Canon. And day after day, I would cold call all day long. I'd get the chance to sell my fax and I-- my price was lower than the Canon. And they would buy the Canon. And I would say, why are you buying the Canon? They'd say, because I've never heard of DEX. So then, a few weeks later, I'd cold call again, keep cold calling and getting rejected. Then I changed my price to match the Canon. And they would buy the Canon. And I said, why are you buying the Canon? They said because still never really heard of DEX, and I'm going to go with the known brand. So then I made the price of my DEX slightly higher than the Canon. And everybody stopped in my meetings and started asking more questions and saying, why is this DEX more money than the Canon? What am I missing? And it gave me an opportunity to really sell the features and what was so special about the DEX fax machine. And they started buying it. So when I priced my own product, I kept that story in mind. There's a lot about value, value perception. And I knew I had to meet a certain formula that I mentioned earlier it needed to be at least 5 times my manufacturing cost to be able to make the business work. And I kept all those variables in mind when I priced my first product. [MUSIC PLAYING] So when I was trying to price SPANX, I kept a few things in the mind because I literally did not know how to price something. I'm like, where do you go to figure out what you're supposed to price something? I kept in mind I wanted it to feel like a gift that someone was buying themself. I also kept in mind that I wanted it to be a value-bas...

About the Instructor

With little more than an idea and a drive to find her way, Sara Blakely went from selling fax machines door-to-door to becoming the world’s youngest female self-made billionaire in 2012. Now the inventor, entrepreneur, and founder of Spanx teaches you to open doors and close deals. Learn Sara’s customer-first approach and her tactics for prototyping, branding and building awareness, and bootstrapping your way to success.


Students give MasterClass an average rating of 4.7 out of 5 stars.

Sara is amazing! She is so authentic and sincere. It felt you were listening to a friend give advice. This class alone is worth signing up for MC.

Gave me confidence as an entrepreneur! Gave useful tools on how to scale my business! The insights on your company's culture is invaluable and exactly what I needed to hear

I am so grateful for the classes of SARA. She is a real inspiration and amazing entrepreneur/person. Love her positivism and her story.

That was an amazing, entertaining, thought provoking, inspiring and hugely valuable lesson in entrepreneurship!


Woai X.

A bit confused about the definition of "value-based". 3:08 - defines "value-based purchase" (in contrast to "cost-based purchase") as a purchase with high value and price isn't so important a factor. 4:10 - implies a "value-based" brand means "the economy-class product". Is this term an auto-antonym?

Jorge G.

I think Sara had to be on the MORE side, because her variable costs were too high. She herself says that in another video once she priced to market, even using that 1/5 rule wherever that came from. In any case, longerie can fall into a boutique level pricing, which is high, but if you're in the food business it's more difficult or you need to have something very distinctive AND that the market actually will pay for such distinctiveness. In all cases you can never, ever sell below your variables or you'll never make a single buck! Such simple Math a lot of people don't know about when pricing their products. In Mexico, for example, a lot of small producers and manufacturers don't really know their costs and that's just terrible.

Banhid B.

With such a grace she talks about her starting point, vulnerability and then the journey and those priceless advices - the best masterclass so far!

Karen B.

These lessons are beyond awesome. I am getting a business class from the best

Alexis Z.

Sara is SO savvy and streetsmart. Plus she has guts! I can totally see why she became a success. Best Masterclass yet!

A fellow student

Absolutely wonderful. I've been an entrepreneur most of my life and actually studied entrepreneurship for my MBA from Texas. This is some of the best "real life" instruction that I've ever heard over all. The pricing information is priceless.

Paul C.

This is by far the BEST, most relevant and immediately implementable advice. She is so clear, logical and organised. Sara, thank you for sharing this wealth of business knowledge!

A fellow student

I teach people how to price, and she’s totally right about price signalling and discounts

Samantha V.

Sarah, you are the role model I didn't know I was looking for. Thank you for saying all the things I needed to hear; you've just validated everything I've been doing.