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How to Effectively Price Products

In this transcript, Jill Donovan (founder of celebrity endorsed, Rustic Cuff) and Clay Clark (U.S. SBA Entrepreneur of the Year) discuss tthe decision on pricing at Thrive15.com, one of the top business schools in PA.

Clay Clark:    This is big stuff. Another area, Jill, that we can really focus in on and maybe factor into our pricing is a celebrity endorsement. I'm going to give an example. Jay Z won't ever acknowledge this but if you read this book called Empire State of Mind, it was written by a Forbes reporter. They investigate and they discover. Apparently Jay Z makes money to endorse products like the Ace of Spades champagne, where he apparently gets paid money to endorse products like the Hublot watch. There's a reason why he wears those. You've been blessed to have a lot of unpaid celebrities wear your products. Does it help your product sales that celebrities wear your products?

Jill Donovan:    Absolutely, yeah. It goes back to, in our culture as well, legitimizing a product. When they see a, b or c celebrity wearing it then it makes people feel it must be a good product if this person that I would idolize as a fashion icon or this person that I watch on TV every day, if they're wearing it, it must be good. Not saying that for every product that tends to be true but that's how our culture ...

Clay Clark:    Let's just give an example. If you're watching this and you're like, "That's not true. I don't do that." Let's just give an example. What is 1 celebrity that started wearing your product that it just happened but it greatly impacted sales? Can you give an example where a celebrity wore it and all of a sudden the floodgates opened a little bit?

Jill Donovan:    I'd probably say one of the first was Miranda Lambert.

Clay Clark:    Miranda Lambert, she starts wearing-

Jill Donovan:    At all her, not all but a majority of her concerts-

Clay Clark:    She's a musician, for those of you who aren't into music. Seriously, I'm just messing with one of the camera guys. Miranda Lambert's a musician. She's wearing your bracelets and people are going, "What is that?" They start Googling it. "What is she wearing?" Then they find you and boom?

Jill Donovan:    There are some websites. I think there's one called coolspotters.com. What they do is they tell people what celebrities are wearing. Somehow they got a hold of what Miranda was wearing and so they would say, "This is Miranda wearing a rustic cuff." I also used that information and I would put it out on social media. I had a picture of a cuff and so it was a picture and a picture, a picture of the cuff and then a picture of Miranda wearing the cuff. That doesn't hurt to-

Clay Clark:    That can help your product?

Jill Donovan:    Absolutely.

Clay Clark:    I just want to give you an example. This is a true story. If you get a chance to read the book called Empire State of Mind, it'll blow your mind. What happened is Jay Z in one of his videos somebody offers him champagne, and Cristal at the time was the top stuff. He says, "Bleugh, I don't want that." He pushes it away. They hand him another bottle and it's the Ace of Spades champagne and he's like, "I'll take some of that." Websites like that are saying if Jay Z, Jay Z the chosen one, the best rapper on the planet, if he is going to drink this beverage, we'd probably better drink this beverage too. Then sales go up. He owns a little equity slice, making some money on that. The Hublot watch, he's like, "I could wear the most expensive watch but I'm not going to wear the brands that you know. I'm going with a new brand. I'm wearing the Hublot watch." People are like, "Hu-what?" "Hublot." Boom, all of a sudden the kids are wearing them.

    Beats, headphones. I have a friend of mine who I cannot use his name on this segment but we'll hint at who he is. He's required in his contract to wear Beats headphones when appearing in any imagery where he has headphones. If he's ever on camera wearing headphones, he has to wear Beats headphones. That's in his contract. Does that impact the sales of Beats? Absolutely. So if you're watching this, I would encourage you to think for a second, "Gosh, what would be a celebrity that could wear my product or use it or that I could pay as an endorser?" Maybe not even pay.

    Do you have a strategy for trying to ... I know you want all consumers to love your product. Do you have a strategy to try to share your product with celebrities? Have you been intentional about that or has it just sort of happened?

Jill Donovan:    I think part of it has happened and I think part of it initially was me being intentional. Initially it's not just going to happen usually, unless you have some sort of connection. So I think you have to be intentional. One of the things I thought about is okay, who would have the most impact for my particular product? I could have a celebrity that I like, I love Matt Damon, but at the time I wasn't wearing-

Clay Clark:    I like Matt Damon as well.

Jill Donovan:    You do? I don't. Just for a long, long time. At the time I wasn't wearing men's cuffs so it didn't make any difference who I loved as a celebrity. I think you have to think about okay, for your particular product who would have the most impact? It also helps that that person is seen in photos. It doesn't help to pick a celebrity who would never leave their house or who is ... Yeah, this one right here, Clayton. You have to be intentional about who you are selecting or who you would like to see photographed in your product.

Clay Clark:    Did you send them nice samples?

Jill Donovan:    I did.

Clay Clark:    Nice stuff?

Jill Donovan:    I did. I actually decided that sometimes the celebrities that I sent them to had kids. When you just have kids, you want to wear anything that has anything to do with [crosstalk 05:58]-

Clay Clark:    How did you find this out? How do you know when they're having kids?

Jill Donovan:    All you do is Entertainment Tonight. Any entertainment channel, they know the blood type of the child.

Clay Clark:    How do you find the address? How do you know who to send it to?

Jill Donovan:    Trade secrets.

Clay Clark:    We can't tell you the exact secret but we can say if you're resourceful you can find it.

Jill Donovan:    You can definitely find out, yeah.

 

 

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