Dollarization, according to Jeffrey J Fox, the author of “How to be a marketing superstar”, is a mathematical calculation of dollars and cents value of a product. Dollarization is important as it helps to determine pricing levels. Here is how you can consider dollarizing your daycare services.
Determine your daycare competitor
Identify the other daycare services that are available to your customers or prospects. Basically, list down who your competitors are.
State the benefit of your daycare
Assess the key benefit that your daycare possesses. Why should your customers register their child at your daycare? Is it the curriculum? Is it the extended hours that you offer? Is it complimentary enrichment lessons? Is it lower student to staff ratio?
Quantify your benefit
Next, look at the benefit and re-state your benefit in numerical terms. If you find it a challenge assigning a numerical value to your stated benefit, it may be wiser to select another because no one buys into the best, the lightest, the fastest, the longest, etc. It is much easier to see value in terms of numbers and facts than empty claims. For example, if you are offering complimentary enrichment lesson as your benefit, how many hours of complimentary enrichment lessons you are offering.
Dollarize the benefit
After quantifying your benefit, “dollarize” the benefit. Assign a dollar value to the benefit based on the quantity of benefit that the customers are getting. For example, what is the charge for the similar enrichment lesson outside of your daycare.
Dollarize the benefit in per unit terms
Next, breakdown the dollarized value down in terms of per unit terms. Using the example above, what is the dollar value of the enrichment lesson that the customer getting in terms per hour.
Demonstrate the true cost of your competitor’s product
From the above, you will be able to demonstrate the additional value that you are offering your daycare customers as compared to your customers.
