Impact Pricing: Recent Episodes
Mark Stiving, Ph.D.
The Impact Pricing Podcast will help you win more business at higher prices by teaching you about pricing and value.
Once you understand how your buyers perceive the value of your product, you can build, market and sell products that win at higher prices.
Pricing is really about creating, communicating and capturing value.
This is an Impact Pricing Blog published on April 21, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/moving-hearts-and-minds/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Join Mark Stiving for a unique dual-guest conversation with Jon Jennings, longtime Impact Pricing sponsor and successful pricing recruiter, and Ryan Walter, a pricing veteran with over 15 years of leadership experience who recently transitioned into recruiting. Together, they reveal the insider's view of private equity pricing transformations, from deal diligence to exit strategies.
In this episode, they explore why private equity firms are investing heavily in pricing capabilities, how to determine the right level of pricing leadership for different situations, and the evolving landscape of pricing careers.
The conversation covers everything from pre-acquisition planning to AI's impact on pricing roles, offering valuable insights for both pricing professionals and business leaders.
Why you have to check out today’s podcast:
- Learn the critical difference between hiring a pricing person and orchestrating a pricing transformation.
- Understand the decision framework for determining whether you need a manager, director, or VP-level pricing leader.
- Explore why portfolio companies often resist pricing initiatives and how to overcome that resistance.
“In the private equity space, part of the diligence is we think there's an opportunity of pricing improvement of some dollar amount to go get. In order to get that, you're going to need to transform the way things are working, which is building out a team.”
– Ryan Walter
Topics Covered:
02:05 – Ryan's journey into pricing: From MBA analytics to solving 7-Eleven's cigarette pricing crisis in Florida
03:29 – Pricing transformation strategies: Why PE's 5-year timeline perfectly aligns with pricing capability building
07:49 – Pricing as a center of excellence: The evolution from analyst roles to VP-level positions and what's next
11:05 – Private equity hiring differences: Stakeholder dynamics, investment thesis pressure, and the "shorter leash" reality
14:30 – Pricing problems in portfolio companies: When port cos don't see the problem PE firms see and how to bridge that gap
17:37 – Pricing transformation explained: Why it's all-encompassing and requires strategy, finance, data, and leadership skills
20:48 – Transformational roles in organizations: The difference between backfilling and building, and why transformation always wins
23:41 – Hiring pricing professionals for PE: Building pricing advisor roles at the firm level and sharing resources across portcos
26:17 – AI's impact on pricing: Data foundation requirements and immediate use cases like rebate design and negotiation prep
29:13 – AI in pricing strategies: Competitive data matching, SKU comparison, and the 80% solution approach
32:06 – Promoting the pricing field: Building the next generation of talent and educating people into pricing careers
Key Takeaways:
"In the private equity space, part of the diligence is we think there's an opportunity of pricing improvement of some dollar amount to go get. In order to get that, you're going to need to transform the way things are working, which is building out a team." – Ryan Walter
"The reason I like that word [transformation] is it's all encompassing because it's not really one thing. It's not, oh, we need to get a director of FPA in here. We need to get somebody who understands strategy, who understands finance, who understands data and IT tools, and is a leader that can influence others." – Ryan Walter
"If you're going to go for a pricing transformation, you have to dive in with both feet. Halfway doesn't typically work." – Jon Jennings
Resources and People Mentioned:
- 7-Eleven: https://www.7-eleven.com/
Connect with Jon Jennings & Ryan Walter:
- LinkedIn: https://www.linkedin.com/in/jonjennings/
- LinkedIn: https://www.linkedin.com/in/ryan-walter3141/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 14, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/willingness-to-pay-is-not-rational/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Stiving is a pricing expert and the host of the Impact Pricing podcast, where he explores the intricate relationship between pricing, value, and context. With a wealth of experience in pricing strategies, Mark is passionate about helping companies maximize their revenue through effective pricing techniques.
Steven Forth is the co-founder and Managing Partner at Ibbaka, a leading pricing strategy consultancy. With deep expertise in B2B SaaS pricing and value-based pricing models, Steven has been at the forefront of pricing innovation for over two decades. He's passionate about the intersection of pricing strategy, customer value, and emerging technologies like AI agents.
In this episode, Steven turns the tables on Mark to explore context-driven pricing – Mark's revolutionary framework that's changing how pricing professionals think about willingness to pay. Together, they dive deep into the four contexts that drive every pricing decision, the three-layer business framework that organizes pricing strategy, and why perfection is the enemy of progress in pricing.
Why you have to check out today’s podcast:
- Discover the concept of context-driven pricing and its significance in today's market.
- Learn how different contexts, such as environmental and customer factors, influence pricing decisions.
- Understand the importance of defining the problem to effectively implement pricing strategies.
“Willingness to pay is contextual.”
– Mark Stiving
Topics Covered:
01:37 – What motivated Mark to think about Context-driven Pricing?
03:15 – The four categories of context: problem, customer, behavioral, and environmental.
04:52 – How environmental factors influence willingness to pay?
06:01 – The role of competitors in shaping pricing strategies.
08:13 – Understanding the foundational problem and its impact on pricing decisions.
14:01 – The intersection of context-driven pricing and AI.
24:58 – Key takeaways on implementing context-driven pricing effectively.
Key Takeaways:
“Pricing is about understanding the context in which a buyer operates.” – Mark Stiving
“Defining the problem is crucial to determining willingness to pay.” – Mark Stiving
“Perfection is impossible; focus on being better every day.” – Mark Stiving
Resources and People Mentioned:
- Steven Forth: https://www.linkedin.com/in/stevenforth/
- Ibbaka: https://www.ibbaka.com/
- Craig Zawada: https://www.linkedin.com/in/craig-zawada-a0a39029/
- Pros: https://pros.com/
- Stephan Liozu: https://www.linkedin.com/in/stephanliozu/
- Zilliant: https://zilliant.com/
- Gabe Smith: https://www.linkedin.com/in/gabesmith/
- PriceFX: https://www.pricefx.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 7, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/tariffs-are-a-second-chance/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Alastair Dryburgh is the Chief Pricing Architect at Intelligent Pricing Architecture and the author of the book “Pricing Genius.” With a background in commercial direction for a marketing consultancy in the pharmaceutical industry, Alastair has spent years honing his expertise in pricing strategies, particularly for creative agencies and consultancies. He believes in the power of value capture and the importance of differentiation in a competitive market.
In this episode, Alastair shares his insights on the significance of value over pricing, the necessity of focusing on unique offerings, and how consultants can effectively communicate their value to clients. Together, they discuss the challenges of pricing in a crowded marketplace and the impact of AI on consulting practices.
Why you have to check out today’s podcast:
- Discover how to capture value effectively in your pricing strategies.
- Learn the importance of differentiation in a competitive consulting market.
- Explore the relationship between pricing, value, and client outcomes.
“Consider seriously the possibility that you are ten times as good as your competitors in at least part of what you do, and you should not rest until you have found a way of getting paid in accordance with that.”
– Alastair Dryburgh
Topics Covered:
01:16 – Meet Alastair Dryburgh, a pricing expert with a unique background in the pharmaceutical industry.
01:55 – Discover the pivotal moment in the pharmaceutical sector that reshaped Alastair's career.
05:22 – Learn why successful pricing hinges on value capture rather than value creation.
05:52 – Understand the oxygen vs. coffee analogy that clarifies the pricing dilemma.
07:37 – Explore the consultant's dilemma of "Will I" vs. "Which one" decisions.
09:33 – Find out why many consultants appear the same and how to differentiate yourself.
11:04 – Uncover the proprietary process strategy inspired by McKinsey that can set you apart.
13:45 – Understand why specialization simplifies your business and enhances your appeal.
16:43 – Learn how to position yourself as the only choice for potential clients.
24:17 – Examine the impact of the AI revolution on consulting pricing models.
28:18 – Get final advice on recognizing and leveraging your 10x advantage in the market.
Key Takeaways:
"It's about value capture, not value creation - you may be creating vast amounts of value but capturing only a tiny fraction of it." – Alastair Dryburgh
"Every time I got more specialist, things got easier - your marketing becomes clearer and clients know immediately if they're your target." – Alastair Dryburgh
"If you're using AI to reduce costs with a cost-plus pricing model, it will kill you - you're just saving your way out of business." – Alastair Dryburgh
Resources and People Mentioned:
- Intelligent Pricing Architecture: https://www.linkedin.com/company/intelligent-pricing-architecture/
- Pricing Genius (book): https://www.amazon.com/Pricing-Genius-Getting-Properly-Advice/dp/1908770783
- McKinsey & Co.: https://www.mckinsey.com/
Connect with Alastair Dryburgh:
- LinkedIn: https://www.linkedin.com/in/alastairdryburgh/
- Free resource: http://alastairdryburgh.com/guide/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 31, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/price-segmentation-at-national-parks/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Marcos Rivera is the founder of Pricing I/O and author of "Street Pricing." He brings 25 years of pricing experience, including a three-year tenure as an operating executive at Vista Equity Partners where he worked on pricing strategies across multiple portfolio companies. He's been running Pricing.io since 2019 and is passionate about the intersection of pricing and AI.
In this episode, Marcos shares his insights on the evolving landscape of pricing in the age of AI, the importance of capturing value, and how companies can differentiate themselves in a competitive market. Together, they discuss the shift from traditional pricing models to outcome-based pricing and the role of AI in enhancing pricing strategies.
Why you have to check out today’s podcast:
- Discover how AI is changing the pricing landscape and what it means for businesses.
- Explore the relationship between pricing, value, and customer outcomes.
- Learn about the importance of low-friction entry points in pricing strategies.
“AI forces you to walk the walk versus talk the talk.”
– Marcos Rivera
Topics Covered:
02:48 – The evolution of pricing in SaaS where the system gets credit for capturing more value using AI.
05:36 – The significance of capturing value quickly and efficiently.
08:09 – Differentiation in a competitive market and the role of pricing power.
12:16 – The importance of entry points and reducing friction for customers.
14:44 – How product design and pricing design are interconnected.
17:07 – The challenges of pricing in the AI landscape.
18:59 – Marcos's approach to using AI in pricing strategies.
28:56 – Pricing advice from Marcos.
Key Takeaways:
“Pricing is about capturing value, and AI opens up new opportunities for that.” – Marcos Rivera
“Entry points matter; make them as low friction as possible.” – Marcos Rivera
“Understanding how to differentiate your offering is crucial in a crowded market.” – Marcos Rivera
People and Resources Mentioned: * Steven Forth: https://impactpricing.com/podcast/691-pricing-in-the-agent-economy-the-future-beyond-subscriptions-with-steven-forth/ * Vista Equity Partners: https://www.vistaequitypartners.com/ * Pricing.io: https://www.pricingio.com/ * Finn AI: https://www.glia.com/ * Zendesk: https://www.zendesk.com/ * Cursor: https://www.cursor.com/ * HubSpot: https://www.hubspot.com/ * Salesforce: https://www.salesforce.com/ * Snowflake: https://www.snowflake.com/en/ * Netflix: https://www.netflix.com/ * Slack: https://slack.com/ * 99designs: https://99designs.com/ * DeepSeek: https://www.deepseek.com/en * ChatGPT: https://openai.com/ * Claude: https://claude.ai/ * Grok: https://grok.com/ * Perplexity: https://www.perplexity.ai/
Connect with Marcos Rivera:
- LinkedIn: https://www.linkedin.com/in/marcoslrivera/
- Website: https://www.pricingio.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 24, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/reasons-why-b2b-salespeople-discount/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is the Co-founder & CEO of Ibbaka and a recognized expert in generative AI in pricing. With extensive experience in the intersection of artificial intelligence and pricing strategies, provides valuable insights into how agents are transforming the pricing landscape.
In this episode, Steven discusses the concept of AI agents, their role in pricing, and how they can deliver value in various contexts. Together, they explore the implications of AI-driven agents on user interfaces, pricing strategies, and the future of business interactions.
Why you have to check out today’s podcast:
- Understand what agents are and how they differ from general-purpose AI.
- Discover how pricing strategies for agents can be structured around value delivery.
- Learn about the future of agent-to-agent interactions and their impact on pricing.
“Understanding what job your agent is going to do is critical for pricing.”
– Steven Forth
Topics Covered:
02:07 – Definition of agents and their functionality.
03:17 – Differences between agents and general-purpose AI like ChatGPT.
05:11 – User interface simplicity and complexity in agent design.
08:16 – The AI agent layer cake and its implications for pricing.
11:12 – Access and usage-based pricing for agents.
14:03 – Outcomes-based pricing and its challenges.
16:16 – Tokenization.
20:27 – The importance of understanding the job an agent performs for pricing.
24:31 – Steven’s insights on the evolving landscape of pricing strategies.
31:28 – Steven’s pricing advice around agents.
31:53 – How to connect with Steven.
Key Takeaways:
“Agents make it easier to do things, and if those things are valuable, we’re going to do them a lot more.” – Steven Forth
“Pricing agents will require a shift in how we think about value delivery.” – Steven Forth
Resources and People Mentioned:
- Jakob Nielsen: https://en.wikipedia.org/wiki/Jakob_Nielsen_(usability_consultant)
- OpenAI: https://openai.com/
- Zilliant: https://zilliant.com/
- Perplexity: https://www.perplexity.ai/
- Salesforce's Agent Force: https://www.salesforce.com/ap/agentforce/
- Marc Benioff: https://en.wikipedia.org/wiki/Marc_Benioff
- AI Agent Layer Cake: https://www.ibbaka.com/ibbaka-market-blog/how-to-price-ai-agents
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibakka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 17, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/practical-pricing-in-a-world-with-tariffs/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mike Blake is the founder of High Score Strategies, with over 26 years of experience in business valuation and M&A markets. He specializes in advising small to medium-sized businesses (SMBs) on increasing their valuations. Mike is passionate about the relationship between pricing and value, and how effective pricing strategies can significantly impact a company's worth.
In this episode, Mike shares his insights on how pricing affects valuation, the importance of differentiation in a competitive market, and the shift from growth to profitability in business models. Together, they explore the concept of context-driven pricing, the significance of signaling in pricing strategies, and how companies can leverage their unique data to enhance their market position.
Why you have to check out today’s podcast:
- Discover how pricing communicates a company's brand and market position.
- Explore the relationship between pricing, profitability, and business valuation.
- Learn about the importance of differentiation and how to create a competitive moat.
“Pricing is language. It communicates to the market what kind of brand you are.”
– Mike Blake
Topics Covered:
01:37 – The relationship between pricing and valuation.
02:30 – The importance of pricing in determining profitability and cash flow.
03:39 – Differentiation and competitive moats in pricing strategies.
04:53 – The shift from growth to profitability in business models.
08:36 – Signaling in pricing and its impact on investor perception.
11:17 – How to differentiate in a market dominated by larger players.
13:23 – The relevance of pricing strategies for SMBs, and how service-based companies offer consulting as value-ad.
17:04 – What Mike does.
19:36 – Why businesses that don't know their business model.
20:53 – Why value-based pricing is excruciatingly difficult.
25:53 – Mike’s advice on pricing and negotiation.
Key Takeaways:
“Pricing is the stem cell for all of that. [Cash flow, revenue, and profitability]” – Mike Blake
“Companies that get pricing right are the most valuable.” – Mike Blake
“If you're selling 100% of your deals you're probably not optimizing your revenue because you're selling too cheaply.” – Mike Blake
“Understanding your unique data can create alternative revenue streams.” – Mike Blake
Connect with Mike Blake:
- LinkedIn: https://www.linkedin.com/in/unblakeable/
- Email: mblake@highscoresstrategies.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 3, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-ai-the-rules-havent-changed-but-your-strategy-should/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Deepak Bhootra is the CEO of Jabulani Consulting, with over 19 years of experience in the tech industry, including significant roles at Hewlett Packard and Sun Microsystems. Deepak has a deep understanding of pricing strategies and their impact on sales performance. He is passionate about helping organizations navigate the complexities of pricing and sales operations.
In this episode, Deepak shares his journey into pricing and sales, discussing the cultural nuances of negotiation in India and how they influence pricing strategies. Together, they explore the challenges salespeople face with pricing, the importance of understanding value from the customer's perspective, and how AI can play a role in pricing strategies.
Why you have to check out today’s podcast:
- Discover the common pitfalls salespeople face when discussing pricing.
- Explore the importance of aligning pricing with customer value and the psychological aspects of pricing.
- Learn how AI can enhance pricing strategies and sales effectiveness.
“Pricing is something that companies use to control sales behavior. Salespeople don’t like to be controlled.”
– Deepak Bhootra
Topics Covered:
01:46 – Deepak introduces himself and shares his background in pricing. 03:10 – The cultural significance of negotiation in India and its impact on pricing. 07:44 – The relationship between sales and pricing and the challenges salespeople face. 14:21 – Discussion on the emotional aspects of pricing and how they affect sales decisions. 17:12 – Insights into the importance of understanding value from the customer's perspective. 23:09 – The role of AI in enhancing pricing strategies and sales effectiveness. 30:35 – Deepak’s pricing advice. 33:18 – Connect with Deepak.
Key Takeaways:
“Salespeople need to understand the value of pricing and how it relates to customer perception.” – Deepak Bhootra
“Value is in the eye of the beholder. Understand what the customer values before discussing pricing.” – Deepak Bhootra
“When you ask a budget question right up front, you're actually setting yourself up for a pricing discussion.” – Deepak Bhootra
“Pricing is one of those conversations where you have complete control of your CRM updates, you have complete control over your forecast, your relationship, but you do not have control over the price because someone else dictates the price.” – Deepak Bhootra
“When you are looking at price, giving a discount is the easiest lever to pull right up front. And typically (salespeople) they do it because they can also bamboozle you with a lot of stuff.” – Deepak Bhootra
People/Resources Mentioned:
- Jabulani Consulting: https://jabulaniconsulting.com
- Amartya Sen: https://en.wikipedia.org/wiki/Amartya_Sen
Connect with Deepak Bhootra:
- LinkedIn: https://www.linkedin.com/in/deepakbhootra/
- Email: deepak@jabulaniconsulting.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 24, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-single-perfect-price/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Vladyslav Podoliako is the founder and CEO of Belkins.io, a leading B2B appointment setting agency, and Folderly, an email deliverability system. With a strong entrepreneurial spirit and a focus on performance-based results, Vlad has successfully navigated the complexities of pricing in the B2B space. He is passionate about helping companies scale their businesses through effective client acquisition strategies.
In this episode, Vlad shares his journey from launching Belkins to evolving his pricing strategies as the company grew. Together, they explore the critical role of pricing in business growth, the importance of aligning pricing with customer value, and the unique challenges of pricing in the B2B landscape.
Why you have to check out today’s podcast:
- Understand the significance of aligning pricing with customer value and performance.
- Discover the importance of testing pricing strategies and gathering client feedback.
- Explore the psychological aspects of pricing and how they influence customer decisions.
“Pricing is like blood in the veins for a growing company. You should have a great pricing model that is scalable and profitable.”
– Vlad Podoliako
Topics Covered:
01:10 – Vlad introduces himself and discusses the common misinterpretation of his company names.
02:15 – The importance of pricing in Vlad's entrepreneurial journey and how it evolved over time.
04:36 – Overview of Belkins and its approach to client acquisition.
06:51 – Discussion on the pricing model based on sales qualified leads (SQLs) and its correlation with client ROI.
09:32 – Insights into product packaging and the pricing strategy for Folderly.
13:15 – The impact of high pricing on customer expectations and delivery pressure.
15:42 – The psychological aspects of pricing and how they relate to perceived value.
19:41 – Discussion on the entrepreneurial spirit in Ukraine and its impact on business success.
24:21 – In scaling your company, how often should you revisit your pricing?
26:50 – Vlad’s advice on being courageous with pricing and testing strategies.
28:01 – Thoughts on ChatGPT pricing for pro.
30:01 – Connect with Vlad.
Key Takeaways:
“Be courageous about your pricing. Test it out more than you strategize theoretically.” – Vlad Podoliako
“(on pricing) It's about how much tries you do before you succeed and how resilient you do that. All of these events, historically, we kind of have this in our blood, adaptability, resilience, and hard work.” – Vlad Podoliako
People/Resources Mentioned:
- Belkins: https://belkins.io/
- Folderly: https://folderly.com/
- OpenAI: https://openai.com/
- Sam Altman: https://en.wikipedia.org/wiki/Sam_Altman
- NVIDIA: https://www.nvidia.com/en-us/
- Google: https://www.google.com/
- LinkedIn: https://www.linkedin.com/
Connect with Vlad Podoliako:
- LinkedIn: https://www.linkedin.com/in/vladPodoliako/
- Email: vlad@belkins.io
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 10, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/creating-pricing-power-that-lasts-a-guide-for-long-term-holdings/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jared Smith is the CEO of PriceSmith, a consulting firm specializing in pricing strategies for distributors and light manufacturers. With a background in pricing systems from Vendavo and experience as an adjunct professor at Oklahoma State, Jared brings a wealth of knowledge to the table. He is passionate about helping companies optimize their pricing strategies to capture more value.
In this episode, Jared shares his journey from Frito-Lay to leading pricing innovation in the B2B distribution space. Together, they explore the key distinctions between B2B and B2C pricing models, especially the negotiation-heavy and data-rich nature of distribution.
Why you have to check out today’s podcast:
- Learn about the differences between B2B and B2C pricing strategies.
- Understand the role of pricing systems in managing large SKU portfolios in distributorship.
- Discover how to effectively segment customers for better pricing strategies.
“Invest in your master data and keep chipping away at it. Start with 80/20 of your products and get that right.”
– Jared Smith
Topics Covered:
01:42 - Jared shares how he got into pricing after his MBA and experiences at Frito-Lay and in B2B distribution.
02:57 - Discussion on the differences between B2C and B2B pricing, including transparency and data access.
06:06 - Challenges in understanding why customers buy and the limitations of data analytics.
12:55 - Jared explains his focus on distribution and the unique challenges it presents.
14:40 - Discussion on the relevance and limitations of cost-plus pricing in distribution.
19:17 - Exploration of how to implement good, better, best pricing in distribution.
25:28 - Discussion on whether distributors publish prices or rely on quotes for transactions.
26:33 - Jared shares insights from Uber experiences and how they relate to distribution pricing.
31:27 - The impact of customer loyalty on pricing strategies and potential risks.
32:55 - Jared's key piece of advice on investing in master data for better pricing strategies.
33:58 - Connect with Jared.
Key Takeaways:
“Distribution is an amazing thing. Obviously, it's worldwide. And the simple fact of it, it has two very unique aspects. The first one, a lot of SKUs. And then, the second one is that you have a lot of customers.” – Jared Smith
People/Resources Mentioned:
- PriceSmith: https://www.pricesmith.com/
- Vendavo: https://www.vendavo.com/
- Oklahoma State University: https://www.okstate.edu/
- Pepsi: https://www.pepsi.com/
- Frito-Lay: https://www.fritolay.com/
- Coca-Cola: https://www.coca-cola.com/
- Apple: https://www.apple.com/
- LG: https://www.lg.com/
- Uber: https://www.uber.com/
- Lyft: https://www.lyft.com/
Connect with Jared Smith:
- LinkedIn: https://www.linkedin.com/in/jaredpaulsmith/
- Email: jared@pricesmith.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 17, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-secret-to-using-ai-in-pricing-ask-expert-questions/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
James Wilton is the founder and managing partner of Monevate, a consulting firm focused on pricing strategies. With a background in consulting from McKinsey and A.T. Kearney, James has a wealth of experience in helping companies capture value through effective pricing. He recently published a book titled "Capturing Value," which delves into the strategic importance of pricing in business.
In this episode, James discusses the nuances of pricing and its critical role in understanding value within a company. He shares insights on how businesses can develop pricing strategies that align with their value propositions and enhance their overall success. James emphasizes the importance of aligning pricing strategies with corporate goals and understanding customer needs, particularly in the SaaS and B2B sectors.
Why you have to check out today’s podcast:
- Learn about the relationship between pricing, value, and corporate strategy.
- Gain insights on the differences between B2B and B2C pricing strategies.
- Understand the evolving landscape of usage-based pricing and its implications.
“Being a little bit more thoughtful of thinking about, what are those different levels of offering that I can give? What is the right price metric that really does help me scale across a few different segments? That can make a massive difference to how much value you're able to extract from your market.”
– James Wilton
Topics Covered:
01:22 – James’ journey into pricing and consulting.
03:35 – The strategic importance of pricing in business.
04:47 – Understanding value and its impact on pricing decisions.
06:24 – The role of pricing in SaaS and B2B companies.
08:12 – Pricing strategy and corporate valuation.
15:05 – James shares insights on pricing AI, arguing that the fundamental principles of pricing remain the same, despite the unique challenges AI presents.
17:08 – James discusses how Monevate is using AI to analyze qualitative research, improving efficiency in summarizing interview results.
20:36 – Exploration of usage-based pricing, with James explaining its advantages and the importance of aligning pricing metrics with the value delivered to customers.
27:32 – James offers key pricing advice for companies, stressing the importance of creating a differentiated pricing structure to maximize value extraction from the market.
28:45 – Connect with James
Key Takeaways:
"Capturing value is about understanding what pricing should do for your company, to capture a fair portion of the value that you create for your customers." - James Wilton
"With AI models these days, you're seeing token-type models that fundamentally focus on the amount of work the system is doing. This results in a cost-based metric rather than a value-based metric." - James Wilton
"Value really is getting some kind of utility from something in its basic way." - James Wilton
People/Resources Mentioned:
- Monevate: https://www.monevate.com/
- McKinsey: https://www.mckinsey.com/
- Capturing Value: https://www.amazon.com/dp/B0DRDVPQJ9
- A.T. Kearney: https://www.kearney.com/
- RELX: https://www.relx.com/
- Steven Forth: https://impactpricing.com/podcast/665-the-future-of-ai-monetization-trends-and-challenges-with-steven-forth/
- PayPal: https://www.paypal.com/
Connect with James Wilton:
- LinkedIn: https://www.linkedin.com/in/jamesdwilton
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 10, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-psychology-of-price-increases-why-a-two-stage-approach-might-work/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Amit Godbole is the founder of ProdSquad, dedicated to simplifying e-commerce technology through improved product management practices. He serves as a fractional chief product officer at FCI CCM and coordinates regional product tank events with Mind the Product, a leading networking organization for product managers.
In this episode, Amit discusses the importance of pricing in product management and how it can significantly impact a company's success. He shares insights on how product managers can leverage pricing strategies to enhance value for customers and drive revenue. Amit emphasizes the need for product managers to take ownership of pricing decisions, especially in the SaaS industry, and highlights the value of understanding customer needs and market dynamics.
Why you have to check out today’s podcast:
- Discover how product managers can influence pricing strategies to drive business success.
- Learn about the evolving role of pricing in product management and why it should be a core focus.
- Gain insights on how to articulate value in terms of revenue, cost reduction, and risk mitigation.
“Discounting typically means you do not value your product, your services, as much as your client does. So, discount should not be part of the strategy.”
– Amit Godbole
Topics Covered:
01:55 – Amit’s unexpected journey into pricing
03:37 – The traditional view of product management and its evolution
04:55 – The importance of pricing in SaaS and B2B companies
05:54 – How product managers can experiment with pricing strategies
07:33 – The significance of understanding customer value and willingness to pay
09:30 – The role of pricing pages in B2B and B2C contexts
11:23 – Strategies for creating effective pricing pages that communicate value
12:34 – The impact of subscription models on pricing strategies
14:50 – The importance of honesty in pricing and customer communication
19:12 – Value-based to context driven pricing
24:19 – Amit’s best pricing advice for product managers
25:10 – Mark's advice to new pricing analyst
Key Takeaways:
“Pricing, revenue, and commercial aspects were the biggest levers somebody could pull in to get a product to the success they want.” – Amit Godbole
“Product management professionals must understand that value has to be tied to revenue, or a dollar value, because that's the real value you can create.” – Amit Godbole
“More companies need to be honest or need to help customers choose the right solution. If that's not right for them, don't upsell that.” – Amit Godbole
People/Resources Mentioned:
- Mind The Product: https://www.mindtheproduct.com/
- Figma: https://www.figma.com/
- Zoom: https://zoom.us/
Connect with Amit Godbole:
- LinkedIn: https://www.linkedin.com/in/amitgodbole
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 4, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/stop-thinking-of-rebates-as-discounts-heres-what-they-really-do/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mathew Kerbis is The Subscription Attorney who is on a mission to affordably serve latent legal market clients at scale via the subscription model and inspire attorneys to abandon the billable hour. He founded the law firm Subscription Attorney LLC.
In this episode, Mathew shares how he's leveraging subscription pricing to disrupt the traditional billable hour model in the legal industry, making legal services more accessible. He highlights his strategy of targeting an underserved market while offering premium pricing options for higher-value clients. Mathew emphasizes his business's profitability, operating with minimal expenses while maintaining a large margin and serving both small and large-scale clients.
Why you have to check out today’s podcast:
- Discover how subscription-based pricing is disrupting traditional legal service models, making legal help more accessible and predictable.
- Learn how addressing the vast underserved legal market can create new opportunities for both clients and lawyers.
- Gain insights on how offering premium pricing options alongside accessible subscription plans can balance profitability with customer satisfaction.
“Don't be afraid to experiment and to try something new. I experiment with my pricing to find what works. And so, you should experiment, too, and listen to Mark.”
- Mathew Kerbis
Topics Covered:
01:37 - How he was led into pricing
03:24 - Discussing the similarities between doctors transitioning to direct primary care (DPC) and lawyers adopting subscription-based pricing
05:05 - Explaining his flexible subscription model
08:48 - Sharing how instead of tracking time or focusing on cost accounting, he views his business costs as fixed expenses
11:03 - Optimizing efficiency and delivering value through his subscription model
14:04 - Arguing that while clients can access AI tools themselves, they can't match the expertise of a lawyer using them effectively
16:04 - Emphasizing that while AI can generate rapid insights, it requires human judgment to interpret results accurately
18:52 - What he meant when he said he drives prices down and discussing the unmet demand creating a significant opportunity despite price competition in the legal industry
21:53 - Targeting underserved clients while maintaining flexibility to serve both small businesses and larger clients
24:26 - Maintaining accessible pricing while using tiered subscription pricing to price higher
26:30 - Highlighting the importance of strategic pricing to remain competitive without risking client loss or revenue instability
27:30 - Mathew's best pricing advice
Key Takeaways:
"Ron Baker has educated me on how cost accounting isn't the way to think about what your actual costs are as a business owner." - Mathew Kerbis
"What's great about a month-to-month subscription is, I could drop the client just like they could drop me. And the fact that they have the flexibility to leave at any time actually makes them not leave." - Mathew Kerbis
“I still want to offer the accessible pricing, but I will have super premium pricing for the best customers that need it.” - Mathew Kerbis
"I don't assign any dollar number to my time or the hours that I spend because things don't take as long as they used to. I was using AI when I launched my firm because I knew less time equals more money doing what I do when you're not billing by the hour." - Mathew Kerbis
"Sure, you could use the legal AI tools that I'm using, but are you able to get the same output that a lawyer who is actually using the tool in the way in which it was designed can get better output?" - Mathew Kerbis
"Judgment is really important. I don't think AI replaces subject matter experts, frankly ever." - Mathew Kerbis
People/Resources Mentioned:
- Ron Baker: https://impactpricing.com/podcast/497-classic-trash-the-timesheet-exploring-opportunities-in-subscription-businesses-with-ronald-j-baker/
- Calendly: https://calendly.com
- Adobe Photoshop: https://www.adobe.com/
- ChatGPT: https://chatgpt.com
- ClaudeAI: https://claude.ai
- Perplexity Pro: https://www.perplexity.ai/hub/faq/what-is-perplexity-proUber:https://www.uber.com
- Grandview Research: https://www.grandviewresearch.com
- Walmart: https://www.walmart.com
- Target: https://www.target.com
- Sam Walton: https://en.wikipedia.org/wiki/Sam_Walton
- Jeff Bezos: https://en.wikipedia.org/wiki/Jeff_Bezos
Connect with Mathew Kerbis:
- Website: https://mathewkerbis.com/
- LinkedIn: https://www.linkedin.com/in/kerbisverse/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 27, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/overcoming-fud-how-to-reduce-fear-uncertainty-and-doubt-in-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Paolo De Angeli is currently leading the Customer Experience and Customer Value Management teams at Borealis AG. He has a strong background and passion for Customer Value, from Value Creation to Value Based Pricing.
In this episode, Paolo shares the importance of persistence for pricing practitioners, encouraging them to confidently share their insights even when facing resistance. He highlights that pricing is not just about numbers but also about effective change management and influencing senior leaders. By staying committed and focusing on both soft skills and strategy, pricing professionals can drive impactful results.
Why you have to check out today’s podcast:
- Gain actionable strategies for understanding customer needs, framing value propositions, and making data-driven pricing decisions.
- Dive into valuable lessons on building strong supplier-customer relationships.
- Learn how pricing is as much about effective communication and influencing as it is about numbers, with tips on navigating resistance.
“If you are a pricing practitioner, you spend time learning, investing. Maybe like I did, taking some certification like the Professional Pricing Society, or you've been involved in the network. You are entitled to share your opinions.”
- Paolo De Angeli
Topics Covered:
01:47 - How he found himself in pricing and what made him embrace it
03:45 - Reflecting on the evolution of the pricing profession
05:32 - Articulating the strategic reasoning behind his role as Head of Customer Experience and Customer Value Management
09:09 - Explaining how customer experience and customer value management are interconnected within a continuous commercial operations cycle
14:28 - Emphasizing the importance of having more customer value conversations, highlighting that customers are generally receptive to it
15:33 - Explaining how companies often fear customer value conversations due to the risk of their assumptions being challenged
20:08 - What process he employs when customers suggest improvements
22:05 - The importance of leading value discussions and identifying and addressing specific KPIs that matter to the customer to demonstrate value
25:20 - Highlighting the need to understand the customer's needs before discussing KPIs
27:11 - Why you need to look beyond customer feature requests to uncover the underlying problems
28:56 - How effective value management benefits both the supplier and the customer, creating a win-win scenario
30:13 - Paolo's best pricing advice
Key Takeaways:
“Everything that we do internally, when we challenge our value proposition, and we try to understand where our differential value is, comes not only from our internal perception but also and above all from what our customers are telling us.” - Paolo De Angeli
“Companies are afraid that customers will not talk, will not share, and will destroy these hypotheses and negotiate on price. And the solution for this is to build a relationship that is more going in the direction of partnership than a transaction with your customers.” - Paolo De Angeli
“If we want to simplify two main applications for customer value management, one is when you launch a new solution in the market, you need to have a differential value, a compelling value proposition, so that you need to be convincing both internally and externally and explain why anyone in the world should be interested in buying from you this new solution and not an existing one.” - Paolo De Angeli
“Managing expectations is the most important thing, it's not because they ask for something that they will get it, but it's, I think that what we owe our customers is to listen to them. Have a conversation on why certain things are possible and others are not, and then have a joint collaboration on what's possible.” - Paolo De Angeli
“Before understanding the KPIs, we need to understand their [customers] needs. We need to understand what their problems are.” - Paolo De Angeli
“It's important to agree on the KPIs, but what matters is, to understand what their[customers] problems are and help them understand the profit equation.” - Paolo De Angeli
People/Resources Mentioned:
- Professional Pricing Society: https://www.pricingsociety.com/
- European Pricing Platform: https://www.pricingplatform.com/about-epp
- Syngenta: https://www.syngenta.com/
Connect with Paolo De Angeli:
- LinkedIn: https://www.linkedin.com/in/paolo-de-angeli-cpp-b232b85/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 20, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/sam-altman-was-right/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Herring is a passionate marketing leader with strong technical roots and deep knowledge of how to market cloud and enterprise software to open-source developers and DevOps audiences. He is the Chief Marketing Officer at HiveMQ.
In this episode, Mark shares his approach to cold outreach, explaining why leading with recognizable brands before introducing value creates engagement. He explores effective email strategies, emphasizing the power of short, curiosity-driven messages over long, detailed pitches. He also discusses pricing from the buyer’s perspective, highlighting how perceived value—rather than just function—drives purchasing decisions.
Why you have to check out today’s podcast:
- Learn proven strategies for grabbing attention in cold calls and emails, using brand credibility and psychological triggers like FOMO.
- Discover how to price based on what buyers truly value, rather than just cost or features, using real-life analogies.
- Get practical tips on structuring sales conversations to keep prospects engaged without sounding like a typical salesperson.
“Try and understand the value in the eyes of your buyer. I think far too many times as vendors, we think there's intrinsic value because it costs us much to produce or we think it looks like that. It's trying to understand from a buying perspective, what is the value you're providing.”
- Mark Herring
Topics Covered:
01:29 - How his journey from development to product marketing led him to pricing
03:41 - How his early pricing research focused on how customers would use a product rather than explicitly asking about the problem it solved
04:59 - To what is the short tenure of CMOs in B2B and consumer goods attributed to
06:25 - Explaining what a pipeline is and how pipeline generation involves value demonstration
10:38 - Comparing pipeline to running a marathon, emphasizing that while MQLs and SQLs are useful stepping stones, the ultimate goal is generating real sales opportunities
12:02 - Differentiating a pipeline from a SQL
14:18 - Demonstrating how a successful cold outreach combines multiple touchpoints
18:57 - How to make prospects more receptive in a cold call
21:13 - Why he uses big brand names as conversation openers in cold calls rather than starting with a value statement
22:27 - What an effective cold email should be
24:42 - Highlighting the importance of A/B testing cold emails and continuously refining outreach strategies to improve open rates
25:55 - Mark's best pricing advice
Key Takeaways:
“It's cold because you've never had the interaction, but usually they've interacted somewhere with you. It's like they might have seen you at an event, or they might have seen some of your outreach to you already and going, ‘Okay, I'll give this guy a bone.’” - Mark Herring
“One of the sales guys was talking about this [cold calls] at the conference we were at together, and I just loved it. And he is like, ‘Don't over research, because there's never a good time to know everything.’ Because you got to keep on dialing.” - Mark Herring
“You can't stop doing it [cold outreach] because it's like getting dice and trying to get the six, the more you throw it, the better chance you're going to get to the six.” - Mark Herring
“I lead [cold call] with brands, not with value. And when you do that type of thing, they're then shocked going, ‘Oh, he didn't do a sales pitch on me. He's asking me about these companies. Well, maybe it is something interesting.’” - Mark Herring
People/Resources Mentioned:
- FedX: https://www.fedex.com/en-us/home.html
- UPS: https://www.ups.com/us/en/home
Connect with Mark Herring:
- LinkedIn: https://www.linkedin.com/in/herringmark/
- Email: mark.herring@hivemq.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 13, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-last-mile-of-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dan Foster is a Chief Operating/Revenue Officer, who built and transformed profitable businesses across technology and telecom start-ups as well as industry powerhouses. Companies turn to him to revive struggling businesses by redefining sales, marketing and customer service strategy, scaling infrastructure, and promoting product innovation.
In this episode, Dan shares how bundled solutions increase value and close rates. He discusses AI’s growing role in B2B sales and procurement. And stresses using data to understand customer needs and justify pricing.
Why you have to check out today’s podcast:
- Learn how bundling products and services can enhance perceived value, increase close rates, and prevent price-sensitive buyers from deconstructing your offerings.
- Gain insights into how AI is transforming the sales landscape, from optimizing product recommendations to procurement teams using AI to negotiate better prices.
- Understand why pricing should be tied to the customer’s business outcomes and how to communicate the true value of your solutions effectively.
"You take the data around a pricing example and you really understand the value from the end user's perspective, so you got to have that empathy back in to say what moves their business. And when we understand what moves their business with a few numbers, then you start to give the underpinning for why value pricing matters."
- Dan Foster
Topics Covered:
02:01 - How his early consulting work made him think about value and led him to pricing
03:23 - Asking about typical reactions to pricing presentations
04:24 - Explaining that selling value starts with understanding product-market fit
07:03 - Highlighting the importance of teaching distribution partners how to sell value, using the Home Depot-SolarCity partnership as an example
10:43 - How can ROI calculators be convincing
14:07 - Explaining that while they don't track proven value directly due to lack of data, anecdotal feedback and supplier insights indicate improved close rates for partners
15:09 - How AI is reshaping product offerings, expanding technology advisors' roles, and influencing cost-cutting for innovation
19:10 - Highlighting that while AI may drive procurement efficiencies complex digital transformation solutions still rely on expertise
20:27 - How bundling simplifies purchasing and reinforce the value of an all-in-one solution
24:27 - Dan's best pricing advice
Key Takeaways:
"If you want to buy a ton of storage and it's a commodity, we get that. That could go through the marketplace earlier than not. If you want a digital transformation, if you want to change your customer experience, if you want to make your business run faster, if you want business process automation and robotic process automation, that's not going through a dynamic pricing model on a marketplace near-term. Now, can I go out and look at, like, UiPath Licensing versus Automation Anywhere versus whoever Microsoft scooped up next and look at pricing models? The procurement folks are probably smart to do that." - Dan Foster
"But the bundled solution specifically is, I think, fundamental because otherwise, when you offer them the menu-based pricing, oftentimes they don't see the full value." - Dan Foster
"It [selling value] starts with that product-market fit. We do a lot of enablement of our partners or downstream almost like a two-tier distributor. And in doing that we provide the ability for them to see a higher close rate when they use tools and resources. It alleviates that conversation and it's inherent that there's value pricing there." - Dan Foster
"It's critical to think through in a subscription-based model what that value is, because that customer acquisition cost versus the long-term value of a customer, it's a critical ratio to understand when you're thinking through pricing." - Dan Foster
People/Resources Mentioned:
- Cummins Engine Company: https://www.cumminsenginepart.com/
- Unilever: https://www.unilever.com
- Alcoa: https://www.alcoa.com/global/en/home/
- Amazon: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/product-reviews/1737655217/ref=cm_cr_dp_d_show_all_btm?ie=UTF8&reviewerType=all_reviews&
- SolarCity: https://en.wikipedia.org/wiki/SolarCity
- Home Depot: https://www.homedepot.com
- Azure: https://azure.microsoft.com/
- Google: https://www.google.com/?client=safari
- Lowe's: https://www.lowes.com
- Sun Power: https://us.sunpower.com
- Sunrun: https://www.sunrun.com
- TD Synnex: https://www.tdsynnex.com/na/us/
- Ingram Micro: https://www.ingrammicro.com
- Five9: https://www.five9.com
- Genesys: https://www.genesys.com/en-sg/
- NICE inContact: https://www.nice.com/
- Zoom: https://zoom.us
- Dialpad: incontact.com/content/home.htm
- ChatGPT: https://chatgpt.com
- Wall Street Journal: https://www.wsj.com/
- Automation Anywhere: https://www.automationanywhere.com
- Microsoft: https://www.microsoft.com/en-ph/
- UiPath Licensing: https://licensing.uipath.com/
- Hulu: https://www.hulu.com/welcome?orig_referrer=https%3A%2F%2Fwww.google.com%2F
- Roku TV: https://www.roku.com/products/roku-tv?srsltid=AfmBOoomwWI9G8ZABYW7gSPFzBHc87xVmartPBXAWzj7GfPfAJQYjTtO
- Super Bowl: https://en.wikipedia.org/wiki/Super_Bowl
- Xfinity: https://www.xfinity.com/
Connect with Dan Foster:
- LinkedIn: https://www.linkedin.com/in/jdanfoster/
- Email: dfoster@telarus.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 6, 2025, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/understanding-context-4-key-factors-that-influence-customer-willingness-to-pay/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Rich Mironov provides product management leadership and coaching to large and small tech companies, with more than 150 clients since 2001. His focus includes: Coaching VPs of Product and CPOs, Organizing the product organization, and Stepping in (occasionally) as a 'smokejumper' VP of Product Management.
In this episode, Rich shares that product managers must define economic value before development. He believes sales teams should communicate, not calculate, value using simple tools. And he advises focusing on broad market data instead of over-relying on top accounts.
Why you have to check out today’s podcast:
- Learn how to define and communicate economic value effectively.
- Understand how sales teams and product managers can align for better pricing decisions.
- Gain actionable tips on framing value in sales conversations without overwhelming buyers.
“You want to look for an aggregate set of data about what's happening in your marketplace as opposed to attaching a lot of overweight to your two largest accounts.”
- Rich Mironov
Topics Covered:
01:22 - Describing his journey into product management and an overview of his role here
03:40 - Differentiating B2C pricing versus B2B pricing as it relates to product management
09:33 - Discussing the balance between standardized pricing for most customers and the reality of frequent one-off deals in B2B
11:28 - How to systematize B2B pricing to reduce one-off deals and encourage standardization
16:59 - Aligning sales compensation with margin to protect long-term profitability
18:39 - Highlighting how enterprise sales teams generalize individual client demands as market-wide needs
20:26 - Why product teams must define economic value before development
25:00 - Agreeing that product teams must define value early but debates how to present it, with Mark favoring customer-driven insights and Rich emphasizing the need for quantifiable justification to close deals
26:25 - Acknowledging that while ROI calculators aren’t inherently trusted, they’re valuable as a conversational tool
28:37 - Rich's best pricing advice
Key Takeaways:
"I believe a fundamental obligation of product management if we're building something that needs this kind of discussion [communicate economic value], is to do the economic math before we start the development. Not after." - Rich Mironov
"Expecting my sales team to be economists is unrealistic. And so, on the product side, I feel like I owe my sales team some narrative that they can read off the page, yes, fill in the numbers, fill in the values, or fill in the quantities. But the value story has to be baked into the product." - Rich Mironov
"We lead with benefits, we lead with stories, we lead with vignettes, we lead with problems. But the last two paragraphs of that have to justify somebody actually signing a contract." - Rich Mironov
People/Resources Mentioned:
- JPMorganChase: https://www.jpmorganchase.com
- New York Stock Exchange: https://www.nyse.com/index
Connect with Rich Mironov:
- LinkedIn: https://www.linkedin.com/in/richmironov/
- Website: mironov.com
- Email: rich@mironov.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 23, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/dynamic-vs-stable-context-a-framework-for-smarter-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ed Arnold works with B2B companies to develop their value-based pricing strategies. His specialty is translating a company’s competitive advantage into a viable customer value pricing strategy, as well as advising on commercial execution.
In this episode, Ed shares when value conversations are most effective. He highlights the need to tailor value models to each prospect through open-ended questions that uncover key business drivers. Because when value is clearly demonstrated, price becomes a secondary concern, resulting in smoother sales and fewer pricing objections.
Why you have to check out today’s podcast:
- Learn why guiding customers to do their own value math is more persuasive than presenting a pre-made ROI model.
- Discover how value conversations shift the focus from cost to impact, making price negotiations smoother.
- Understand why dumping numbers on customers backfires and how to engage them in a way that builds trust and buy-in.
"As customers, we have a good sense of what a great deal is. But as sellers, we're much less certain about what that value is. You need to have value conversations to get at that."
- Ed Arnold
Topics Covered:
00:57 - How he accidentally got into, left, and keeps returning to pricing
03:25 - Explaining how pricing challenges often signal deeper business issues
08:46 - Why customers distrust ROI calculators
11:05 - What value conversation is all about and how to effectively go through it
14:00 - Emphasizing that trust is built through reliability and honest engagement
16:57 - How many good salespeople are there and what make good salespeople
19:17 - The importance of market focus and playbooks in sales
20:49 - Showing the most effective value conversation to have
25:03 - How he trains salespeople on value conversations
29:53 - Noting that while he focuses on larger customers, the same value-based principles apply to marketing lower-ACV products
30:24 - Ed's best pricing advice
Key Takeaways:
"You cannot solve any pricing issue without tackling the strategy. And if the strategy is flawed, then the pricing isn't going to help you." - Ed Arnold
"...and this is the thing that I think about value stories. It's not about the product. It's about the customer. The customer is the star of the story." - Ed Arnold
People/Resources Mentioned:
- Steven Forth: https://www.linkedin.com/in/stevenforth/
- Forrester: https://www.forrester.com/bold/
- Monitor Deloitte: https://www.deloitte.com/global/en/services/consulting/services/monitor-deloitte.html
- Leverage Point: https://www.leveragepoint.com/
Connect with Ed Arnold:
- LinkedIn: https://www.linkedin.com/in/edarnold1/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 16, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-drivers-vs-value-tables-when-to-go-broad-and-when-to-be-specific/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm.
In this episode, Steven shares the potential commoditization of AI pricing agents, explaining how their replication and standardization could drive down differentiation and value. He explores the interplay between AI-driven sales and buying processes, emphasizing that businesses must consider how AI will influence purchasing decisions. He also touches on the potential of AI to simplify legal tasks.
Why you have to check out today’s podcast:
- Learn how AI-powered pricing agents compare to SaaS models and why they might face rapid commoditization in the evolving AI landscape.
- Discover why AI-driven buying decisions are just as important as AI-powered selling strategies—and what that means for the future of pricing.
- Find out how DeepSeek’s approach to AI training and pricing could shake up the industry, with potential implications for OpenAI and other major players.
"I think that they need to put themselves in the buyer's shoes and ask themselves, how would I be using AI to make a buying decision?"
- Steven Forth
Topics Covered:
01:23 - Explaining the four types of AI products and how they impact pricing, automation, and value creation
09:51 - Exploring whether AI agents will become commoditized
12:46 - How complex pricing workflows require multiple AI agents working together as a service, rather than a single standalone pricing agent
14:17 - Explaining that differentiated AI agents with better performance will still command higher prices
19:20 - Highlighting how DeepSeek’s advancements in post-training optimization and lower pricing could drive broader AI adoption
21:20 - What makes AI agents more prone to commoditization
23:22 - How SaaS solutions are less prone to commoditization than AI agents
26:32 - Suggesting that tasks like real estate conveyance could be automated by AI agents
29:02 - Steven's best pricing advice
Key Takeaways:
"A lot of the use cases for outcome-based pricing or results-based pricing really only become relevant when an action is taken on your behalf. And you can evaluate the value of that action and the success of that action." - Steven Forth
"Are all agents by nature more subject to commoditization than other parts of the ecology, like copilots or service as software or generators? My gut feeling is that there are going to be agents that are highly differentiated because they rely on highly customized underlying language models and highly tuned prompt sequences that would not be easy for someone else to recreate. And that they'll be able to make better decisions." - Steven Forth
"Apart from very specific and narrow cases, I don't think pricing is going to be done by agents. Pricing will be service as software." - Steven Forth
People/Resources Mentioned:
- Grammarly: https://www.grammarly.com
- Copilot: https://copilot.microsoft.com/onboarding
- ChatGPT: https://chatgpt.com/
- Hugging Face: https://huggingface.co
- Hubspot: https://www.hubspot.com
- FinnAI: https://www.finnai.io/en
- LegalZoom: https://www.legalzoom.com
- Zendesk: https://www.zendesk.com
- Microsoft: https://www.microsoft.com/
- Pros: https://pros.com
- Vendavo: https://www.vendavo.com
- Zilliant: https://zilliant.com
- Pricefx: https://www.pricefx.com
- Maxio: https://www.maxio.com
- DeepSeek: https://en.wikipedia.org/wiki/DeepSeek
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 9, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/unlocking-portfolio-value-through-strategic-price-increases/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Joshua Lowe is a solution-focused pricing professional with a proven track record in pricing (10 years) and pricing transformation (3+ years). He also has an expertise in implementing and utilizing PriceFX, a cloud-native pricing management software.
In this episode, Joshua discusses the evolution of pricing in the auto parts industry, explaining how his company is transitioning from traditional cost-plus pricing to more market-based and value-driven strategies. He highlights the role of data analytics and predictive modeling in optimizing pricing decisions while maintaining fairness and customer retention.
Why you have to check out today’s podcast:
- Learn how a major industry player is shifting from cost-plus pricing to market-based and value-based approaches.
- Discover how analytics and data science shape pricing strategies, ensuring competitiveness and profitability.
- Understand why leaving some value on the table fosters long-term customer relationships and repeat business.
"You've got more pricing power than you might realize."
- Joshua Lowe
Topics Covered:
01:31 - Joshua describing his journey into pricing
02:55 - Clarifying that Napa Auto Parts is a wholly owned subsidiary of Genuine Parts Company and sharing why he has stayed with Napa Auto Parts
04:27 - How his pricing strategies not only capture value but also reinvest in growth and detailing his role in setting nationwide retail, wholesale, and resale pricing frameworks
06:37 - The evolution of market segmentation in pricing, highlighting shifts between regional and nationwide pricing models and the factors influencing those changes
08:53 - Explaining customer segmentation in pricing, emphasizing the importance of transaction data, value drivers, and willingness to pay
11:27 - Pricing strategies based on delivery distance, emphasizing relationship-based pricing over cost-to-serve
13:09 - Explaining product segmentation and how Napa Auto parts sources products
15:56 - How cost increases from suppliers generally flow through their own pricing
17:03 - The role of cost-plus pricing in the industry and its gradual shift toward market-based and value-based pricing
21:31 - How Napa Auto Parts structures pricing
24:59 - Joshua's best pricing advice
Key Takeaways:
“There's a lot of price moves that you use in pricing to extract value, but a lot of times too, you're trying to figure out ways to reinvest those wins back into sales so that you can grow.” - Joshua Lowe
“You never try to extract a hundred percent of the value of any single transaction because you might actually start losing customer retention over time. You want to leave 10, 20% on the table. I've always kind of kept that in the back of my mind as we do certain activities of how we keep the fairness in play as we make pricing actions.” - Joshua Lowe
People/Resources Mentioned:
- Gates Corporation: https://www.gates.com/us/en.html
- Genuine Parts Company: https://www.genpt.com/
- Napa Auto Parts: https://www.napaonline.com/
Connect with Joshua Lowe:
- LinkedIn: https://www.linkedin.com/in/joshua-lowe-42034746/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 2, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/what-is-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dave Brown is a CEO / Founder of QiiQ Healthcare which is developing an AI assistant for healthcare workers, to invigorate the deep sense of fulfillment in delivering high quality care - frictionlessly.
In this episode, Dave shares how AI can improve healthcare by providing clinicians with actionable insights from patient data, making consultations more efficient. He highlights the challenge of adopting new technologies in healthcare due to risks and the complexity of changing established systems. Brown also shares insights on the economic impact of healthcare innovations and stresses the importance of doing thorough homework when entering the healthcare market.
Why you have to check out today’s podcast:
- Explore the impact of AI in healthcare and how it can improve healthcare outcomes and reduce doctor-patient interaction.
- Gain insights on healthcare pricing challenges and how understanding stakeholder decisions can lead to more effective solutions.
- Learn to navigate the massive, evolving healthcare industry and the challenges of making a meaningful impact through technology and pricing strategies.
"Do your homework. You cannot wander into this [healthcare] with youthful vigor and expect to change the world easily. And it's certainly not easy to come up with a pricing model that everybody understands and likes."
- Dave Brown
Topics Covered:
01:46 - How he got interested in pricing and why it mattered to him
03:13 - Detailing how QiiQ Healthcare technology works and what makes pricing for it complicated
10:58 - Sharing how QiiQ is driven by a social mission, as well as mentioning the real challenge in healthcare technology
13:49 - How QiiQ Healthcare technology is demonstrating its value in a leading Parkinson’s clinic
15:29 - Addressing patient willingness to pay and the impact of chronic diseases on society
18:34 - How QiiQ technology streamline doctor-patient interactions and save time
21:06 - Using the trolley problem to illustrate the complexity of decision-making in change management
23:31 - Highlighting the challenge of adopting new technology despite its potential, due to uncertainty and mental workload
25:34 - Discussing the challenges of accepting AI in healthcare, drawing analogies to self-driving cars and the risks involved
28:40 - Explaining how the relationship between cost reduction and profits in healthcare is complex and not solely driven by cynicism
29:45 - Dave's best pricing advice
Key Takeaways:
“Everybody that's working with me is driven by a social need or a social urge. It's extremely common in the healthcare industry. But part of what you're hearing [challenges] is motivated by a deeper grasp of the challenge in adoption. Without adoption, you generate no value.” - Dave Brown
Connect with Dave Brown:
- Website: https://www.qiiq.health/
- LinkedIn: https://www.linkedin.com/in/davecbrown/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 24, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/confused-buyers-dont-buy-a-case-study-in-how-to-align-saas-pricing-with-customer-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Peacock helps B2B Tech & Consulting firms expand margin & revenue growth with tailored pricing solutions & sales enablement.
In this episode, Mark shares practical strategies for implementing price increases effectively, including a two-stage communication process to manage customer expectations and reduce resistance. He emphasizes the importance of segmenting clients by price sensitivity and value to tailor pricing strategies and build confidence. Mark also highlighted the need to treat price increases for existing customers with the same care as new business pricing to maximize business impact.
Why you have to check out today’s podcast:
- Learn proven strategies to implement price changes confidently without losing customer trust or loyalty.
- Discover an innovative approach to preparing customers for price increases minimizing resistance, and maximizing acceptance.
- Explore techniques for segmenting clients, leveraging value-based pricing, and fostering long-term relationships.
“Treat price increases for existing customers with the same importance that you do pricing for new business, because it can have such a profound impact on your business and it's nothing to be scared of.”
- Mark Peacock
Topics Covered:
01:48 - Describing his pricing journey
02:58 - The transformative power of smart pricing strategies
06:13 - Check out Mark's article in LinkedIn, ‘Raise Prices Without Raising Eyebrows’
06:52 - The importance of putting as much effort into planning and communicating price increases with existing customers as devoting to winning new business
09:21 - The two-stage process to make price increase more acceptable to your customers
12:34 - The third step to communicating your price increase
14:49 - Explaining the value reasons why customers should stick with you [the fourth step]
16:55 - Communicate your 'investment story' [fifth step]
18:44 - Give your customers the options and do away with hard sell [sixth step]
21:53 - Talking about frictionless approach to price increase [seventh step]
23:22 - Important thoughts on the 'do something nice' strategy
26:45 - One top tip to help you segment customers based on price sensitivity and stop churn
27:59 - More techniques for customer segmentation
28:59 - Mark's best pricing advice
Key Takeaways:
“Communicating a price increase is a sales task, and you would never use negative language in a sales activity.” - Mark Peacock
“The most important thing about a price increase communication is that there is no hard sell.” - Mark Peacock
“You need to provide them with some ways to come back to you however they want, either to approve it, to reject it, to discuss it, or if you've got upgrade or downgrade paths as well.“ - Mark Peacock
“Be as open and transparent as possible so that the buyer has total agency and control over that decision, and you are making it entirely their decision because that's how you build trust.” - Mark Peacock
Connect with Mark Peacock:
- LinkedIn: https://www.linkedin.com/in/mark-peacock-pricemaker/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 18, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/perfect-pricing-is-impossible-and-thats-ok/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Gilham is an experienced senior executive with a proven track record in finance, strategy, and consulting. He brings deep expertise in driving commercial success, improving operational efficiencies, and influencing industry best practices.
In this episode, Mark shares the transformative power of rebates as tools for driving both customer behavior and operational efficiency, rather than just cost-cutting mechanisms. He highlights the importance of designing rebates that align with business goals, such as incentivizing desirable customer actions, improving operational processes, and fostering long-term loyalty.
Why you have to check out today’s podcast:
- Learn how rebates can go beyond simple cost-cutting to solve operational challenges, enhance customer loyalty, and drive profitability for your business.
- Gain insights into how rebates can incentivize customer behaviors that benefit both parties, creating a more collaborative and sustainable business relationship.
- Discover innovative ways to use rebates to optimize your operations, create efficiencies, and stronger partnerships with customers.
"Get out from behind your desk; get away from the spreadsheet and understand your business. Understand what makes your business tick."
- Mark Gilham
Topics Covered:
01:11 - How he transitioned from accountancy to pricing
02:24 - Explaining why accountants' focus on cost-plus pricing
03:52 - Highlighting how understanding pricing enables finance professionals to interpret data more effectively and influence business outcomes
05:35 - Strategic role of rebates in B2B, their challenges, and how they differ from traditional incentives and discounts
08:18 - Importance of structuring rebates and balancing discounts and rebates in B2B to maintain margins
11:11 - Dynamics of incentivizing end consumers versus channel partners
14:59 - Optimizing rebate structures
20:40 - Sharing how rebates can incentivize operational efficiency
25:55 - Advocating for pricing teams to lead rebate strategies to create lasting customer relationships and reduce reliance on discounting
28:11 - Highlighting the potential of rebates to address operational inefficiencies
Key Takeaways:
"Immature pricing practices tend to be that cost-plus. And when I say immature, it's not that it's bad, it's just they don't know what good looks like or what's better." - Mark Gilham
"A good rebate is a rebate that a manufacturer or supplier wants to pay out." - Mark Gilham
"I believe pricing have the tools and the skillset to, and it should be on the sell side, to equip salespeople to go out, not to win an order, but to kind of win a relationship. And make that relationship sticky so that discounting actually is not, it's always going to be important, but hopefully you can take a little bit of that pressure off the table." - Mark Gilham
"If you want a better deal from your supplier, think about all the things you could do to make their life easier and ask them, ‘What's that worth to you?’ And that's a far better way of getting a bit of extra money out of the contract than just saying, ‘I want my product for less.’" - Mark Gilham
People/Resources Mentioned:
- Enable: https://www.enable.com
Connect with Mark Gilham:
- LinkedIn: https://www.linkedin.com/in/markgilham/
- Email: mark.gilham@enable.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 11, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/you-influence-your-customers-willingness-to-pay/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Vance Morris is a former Disney Leader turned entrepreneur, coach, speaker and author. He helps businesses deliver extraordinary customer experiences through workshops, boot camps, and training at Disney.
In this episode, Vance shares practical strategies for implementing premium pricing by presenting options and building value through transparency and trust. He emphasizes the importance of creating emotional connections with customers to enhance loyalty and retention, even in B2B environments. Additionally, he advocates for confident implementation of price increases, highlighting that many pricing challenges stem from business owners' mindset rather than market resistance.
Why you have to check out today’s podcast:
- Learn how to confidently set premium prices and create packages that differentiate your business from competitors.
- Discover how emotional connections, rather than just logic, can drive customer loyalty and enhance sales, even in B2B settings.
- Get tips on overcoming common pricing hurdles and improving customer retention through simple yet effective strategies.
“People have enough information, they don't have enough implementation; just go do it. You could go out right now, raise your prices 10% and nobody's going to bat an eyelash.”
- Vance Morris
Topics Covered:
01:45 - How he found himself in pricing
02:31 - Sustaining a cycle of value and profitability as inspired by Disney's pricing strategies
05:20 - How he justifies premium pricing in his upholstery cleaning business
08:46 - Demonstrating expertise and showcasing value
11:32 - Emphasizing the value of positioning as a premium service rather than competing on being the second cheapest
13:00 - Maintaining pricing integrity
14:21 - Adapting Disney-inspired strategies to differentiate your business making it incomparable to competitors
16:37 - How to differentiate your products or services, even in competitive markets like B2B software
17:57 - How to foster loyalty, enhance customer retention, and make price increases more acceptable
21:09 - Highlighting the value of small, thoughtful gestures to build a positive reputation and stand out in competition
22:42 - Offering premium pricing tiers in clear, non-salesy manner
24:57 - Vance’s best pricing advice
Key Takeaways:
"Not so much to justify [premium pricing], as it is being able to offer a better experience, which then allows me to charge a higher price, which puts more money in my pocket." - Vance Morris
"It's about creating a connection. It's people doing business with people. It's not people doing business with business and creating some kind of emotional connection with the purchasing manager, with whoever's doing the buying. And it just makes selling so much easier." - Vance Morris
"When you have that connection, a price increase may not be overlooked, but is a lot more palatable than just hard excel spreadsheets flying around." - Vance Morris
"There is no competitive advantage to being second cheapest; if you're not going to be the cheapest, you might as well go the other direction." - Vance Morris
People/Resources Mentioned:
- Disney: https://www.disney.com/
- Ritz-Carlton: https://www.ritzcarlton.com/
- Dunkin Donuts: https://www.dunkindonuts.com/en
Connect with Vance Morris:
- LinkedIn: https://www.linkedin.com/in/vancemorris/
- Website: https://deliverservicenow.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 4, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-fluid-nature-of-willingness-to-pay-how-context-shapes-your-pricing-strategy/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Stephan Liozu is a business executive with deep knowledge in pricing strategy, value-based pricing, monetization, and transformations. He speaks the language of sales, pricing, finance, and the C-suite.
In this episode, Stephan highlights the need to combine value-based pricing with strong change management for successful transformations. He shares practical segmentation strategies tailored to diverse business needs. Reflecting on his move into pricing software, he explores its potential and the challenges of gaining C-suite support.
Why you have to check out today’s podcast:
- Delve into the nuances of value-based pricing and its implementation and practical advice for businesses aiming to maximize profitability while addressing internal and external challenges.
- Learn about a methodology for effective customer segmentation, practical steps, and real-world applications for targeted strategies.
- Discover the critical role of change management in successfully implementing pricing strategies and have a deeper understanding of organizational dynamics and leadership in pricing transformations.
"You cannot do advanced pricing without advanced change management and change leadership."
- Stephan Liozu
Topics Covered:
01:10 - Significance of the Chief Value Officer (CVO) title
01:58 - The complexity of defining value within companies
02:52 - Contrasting his roles as a Chief Value Officer at Thales and Zilliant
04:35 - Reflecting on the challenges and uncertain future of the pricing profession with his article on LinkedIn
06:27 - Discussing the challenges of B2B pricing which hinders value-based pricing and the scalability of pricing strategies
12:11 - Advocating for internal pricing centers of excellence as cost-effective
14:01 - Explaining his approach to segmentation
17:26 - Stephan expressing excitement about his Zilliant role, exploring pricing software's potential and questioning its limited market growth
19:07 - The challenges of convincing the C-suite to invest in pricing solutions, suggesting on reframing pricing discussions under a new term
22:31 - Stephan's best pricing advice
Key Takeaways:
“If you want to industrialize your processes in pricing and value, you have to use an engine, the heart of this engine is software. And be able to touch all the business if possible, at least a large amount of the business.” - Stephan Liozu
“Pricing professionals should become certified change managers, it should not be an option.” - Stephan Liozu
People/Resources Mentioned:
- Thales: https://cpl.thalesgroup.com/software-monetization/software-packaging-pricing
- Zilliant: https://zilliant.com
- McKinsey: https://www.mckinsey.com
Connect with Stephan Liozu:
- LinkedIn: https://www.linkedin.com/in/stephanliozu/
- Website: https://www.stephanliozu.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm.
In this episode, Steven discusses how AI, particularly transformer models, is revolutionizing business strategies by automating complex tasks like value modeling and scenario planning, making them more efficient. He emphasizes the importance of leveraging AI to explore frameworks and generate innovative solutions, such as using AI to better understand industry problems. Steven also highlights the ongoing development of prompt orchestration tools, which will soon become essential for managing AI workflows and optimizing the use of multiple models.
Why you have to check out today’s podcast:
- Discover how AI is transforming traditional frameworks like value modeling, scenario planning, and pricing, making complex processes faster and more efficient.
- Gain insights on how AI can help you better understand problems and create innovative solutions, ultimately improving your decision-making process.
- Dive into emerging concepts like prompt orchestration and how AI is evolving, giving you the tools to enhance your AI workflows for maximum effectiveness.
“Create a series of prompts, create a series of context documents that you can reuse and explore the framework in ways that you never could before and find ways of applying it.”
- Steven Forth
Topics Covered:
02:10 - How no single AI model can meet all needs, thus, advocating for multiple model for diverse perspectives and specialized capabilities
03:11 - Distinguishing between diffusion models and transformer models
05:46 - How does a transformer model work
07:28 - Understanding the [LQMs] Large Quantitative Models, [RAG] Retrieval Augmented Generation and challenges faced by companies like Pros in leveraging customer-owned data
11:39 - How Wolfram/Alpha uses mathematical reasoning to validate and simplify equations and highlighting the emergence of reasoning models for complex problem-solving
15:34 - Steven reflecting on his increasing reliance on AI tools, how they are transforming his thinking, and the need to embrace these technologies as vital partners in enhancing exploration, communication, and decision-making
17:17 - How generative AI enables more dynamic and efficient approaches to scenario planning
23:29 - Emphasizing how leveraging AI with established frameworks accelerates complex tasks like building value models
25:13 - Learning 'prompt orchestration’ to optimize prompt sequences and responses
26:52 - Explaining Perplexity's limitations in generating complete outputs
Key Takeaways:
“It used to take Ibbaka between 40 and 60 hours of work by a highly trained person to build a value model. It now takes us less than two hours to build a better value model than we could have done before.” - Steven Forth
People / Resources Mentioned:
- Geoffrey Hinton: https://en.wikipedia.org/wiki/Geoffrey_Hinton
- Bloomberg: https://www.bloomberg.com/asia
- Attention is All You Need paper: https://en.wikipedia.org/wiki/Attention_Is_All_You_Need
- Sam Altman: https://en.wikipedia.org/wiki/Sam_Altman
- Karen Chiang: https://impactpricing.com/podcast/467-minimize-churn-and-boost-your-net-dollar-retention-with-karen-chiang/
- Porter's 5 Forces: https://en.wikipedia.org/wiki/Porter%27s_five_forces_analysis
- Clayton Christensen: https://en.wikipedia.org/wiki/Clayton_Christensen
- William Gibson: https://en.wikipedia.org/wiki/William_Gibson
- Perplexity AI: https://www.perplexity.ai
- ChatGPT: https://chatgpt.com
- You.com: https://you.com
- Hugging Face: https://huggingface.co
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 24, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/context-driven-pricing-the-ultimate-pricing-strategy/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Russ Winer is a William H. Joyce Professor of Marketing, Stern School of Business, New York University. His specialties include pricing, new technologies, consumer choice models, and advertising.
In this podcast, Russ discusses the critical role of understanding consumer behavior in pricing decisions, emphasizing the importance of considering how customers will react to price changes. He explains the difference between academic theories and practical applications in marketing and also highlights the growing shift of research from academia to industry, particularly in data-driven fields like marketing, and stresses the need for businesses to stay competitive while balancing consumer protection and profitability.
Why you have to check out today’s podcast:
- Gain practical advice on how businesses can align their pricing strategies with consumer behavior for maximum impact.
- Discover the unique perspectives on how academic research shapes real-world marketing practices and why general theories can be a game-changer for business strategies.
- Learn about the challenges and opportunities in both B2B and B2C markets, including data availability, decision-making processes, and competitive pressures.
"Don't forget the consumer, or customer, if it's B2B, when you're thinking about the price. How is the customer or consumer going to react when you take this particular action?"
- Russ Winer
Topics Covered:
01:48 - One accomplishment that brings Russ great pride
02:13 - Describing his entry into pricing
03:56 - Clarifying that he did not introduce the concept of reference price, though he was the first to incorporate it into empirical models
04:45 - Distinguishing reference pricing from behavioral economics
06:40 - How context influences reference prices, highlighting the relevance of acquisition and transaction utility in pricing
08:08 - Explaining the psychology behind 99-cent pricing
09:50 - Discussing deceptive pricing, highlighting practices like false markdowns in both brick-and-mortar stores and online retail
11:59 - Comparing deceptive pricing to deceptive advertising
14:33 - Differentiating between academics and practice in marketing
17:23 - The data availability challenges between B2C and B2B research
20:20 - Reflecting on the shift of research dominance from academia to industry
25:44 - How marketers' strategies to influence reference prices are not inherently harmful to consumers
28:14 - Russ's one best pricing advice
Key Takeaways:
“It's not just the firm side that's important when we think about pricing, it's also the consumer side, how they react to the prices that we're putting in the marketplace.” - Russ Winer
People/Resources Mentioned:
- Bob Lucas: https://en.wikipedia.org/wiki/Robert_Lucas_Jr.
- Richard Thaler: https://en.wikipedia.org/wiki/Richard_Thaler
- Dan Kahneman: https://en.wikipedia.org/wiki/Daniel_Kahneman
- Amos Tversky: https://en.wikipedia.org/wiki/Amos_Tversky
- Facebook: https://www.facebook.com
- Airbnb: https://www.airbnb.com
- Google: https://www.google.com/
- Campbells: https://www.campbells.com/
Connect with Russ Winer:
- LinkedIn: https://www.linkedin.com/in/russ-winer-4b69b7/
- Email: rwiner@stern.nyu.edu
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 17, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/profit-vs-market-share-which-should-your-business-prioritize/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mike Wilkinson is referred to as The Value Sales Expert whose focus is on value and value selling.
In this episode, Mike shares what is involved in a successful value-based selling to enable tailored solutions that address specific challenges of your customers. He emphasizes the importance of measuring and reinforcing delivered value while developing ongoing relationships to uncover new opportunities and ensure long-term success.
Why you have to check out today’s podcast:
- Learn about a five-step value-based selling framework to help you master value-based selling and deepen customer relationships.
- Gain Insights from real-world perspectives, practical advice, and candid reflections on overcoming common sales challenges.
- Discover how to shift from a product-first to a customer-first mindset and transform your sales approach.
"The most important thing from a seller's point of view is be confident in your price. And the way to be confident in your pricing is to make sure that you know, you're absolutely certain, that the value that you are delivering is more than a match for the price you're going to be charging."
- Mike Wilkinson
Topics Covered:
02:21 - Mike describing what he does
02:52 - Elaborating on the concept of value
07:33 - Highlighting the 'Value Triad' as it relates to the value drivers
11:08 - Mike's approach to teaching value-based selling
14:46 - Outdated sales practices that focus on pushing products rather than solving customer problems
16:48 - Thoughts on Zig Ziglar's sales principles and the importance of value discovery in the sales process
21:48 - How to ask impact-driven questions
24:07 - Detailing an effective value discovery and value demonstration to ensure a successful conclusion
26:51 - What value delivery means
28:07 - Value development and what it encompasses and the importance of regular reviews
29:33 - Mike's best pricing advice
Key Takeaways:
“Until we understand how our customers are defining value for them, then to all intents and purposes, value is a mystery. And as sellers in particular, our job is to solve that value mystery.” - Mike Wilkinson
“It’s your customer that defines value, not you.” - Mike Wilkinson
“Until you've understood what the issues are from the customer's point of view, you do not have a solution.” - Mike Wilkinson
People/Resources Mentioned:
- McKinsey: https://www.mckinsey.com
- Zig Ziglar: https://en.wikipedia.org/wiki/Zig_Ziglar
- Seth Godin: https://www.sethgodin.com
Connect with Mike Wilkinson:
- Website: https://axiavalue.com/
- LinkedIn: https://www.linkedin.com/in/mikewilkinson-thevalueexpert/
- Email: mw@axiavalue.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 10, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/what-every-team-should-learn-from-pricing-experts-focus-on-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Daniel Cho has over 29 years of experience in the healthcare industry, currently serving as the Senior Director of Global Pricing at Philips Healthcare. With a background in sales, product management, and pricing strategy, Daniel has a unique perspective on how to effectively communicate value to customers and drive profitability.
In this episode, Daniel shares his journey into pricing and the critical importance of understanding the value your product delivers to customers. He emphasizes that pricing should not just be about features but about the economic, operational, emotional, clinical, and societal value that resonates with different stakeholders. Through real-world examples, Daniel illustrates how a well-structured pricing strategy can lead to stronger, more profitable relationships.
Why you have to check out today’s podcast:
- Discover the five key value drivers that can transform your pricing strategy and enhance customer relationships.
- Learn how to effectively communicate value to different stakeholders within a healthcare organization, from CFOs to clinical staff.
- Gain insights into structuring contracts and pricing metrics that align with customer needs and perceptions of value.
“Resist on the discount as much as possible. Look for every other ways to solve it rather than the discount. The discount should always be a last resort and not the first thing you want to deliver or give.”
– Daniel Cho
Topics Covered:
02:33 - Daniel's journey into pricing
03:23 - The power of pricing strategy, using segmentation and perceived value to differentiate identical products for distinct markets
06:58 - How two identical products can be integrated differently with existing pricing ecosystems
07:57 - Leveraging his expertise in data analysis to establish Philips' first pricing department
12:11 - Initiating a value-based approach at Philips to create, price, and articulate value
14:22 - Defining value and discussing the 5 key value drivers in a health organization
18:03 - Tailoring value propositions and demonstrating how those four other value streams ultimately lead to financial and strategic benefits
25:22 - An effective sales training Daniel created that teaches salespeople to tailor value-based pitches to different stakeholders’ priorities
31:27 - Daniel's best pricing advice
Key Takeaways:
“We cannot continue to sell features and benefits, we have to go and sell value.” - Daniel Cho
“If the product is not value-based, you can't ask the salespeople to sell value because you have to start from the product that actually deliver and generate value. So, we started from the product managers.” - Daniel Cho
“The first one is economic value. Very simple. Help me to make more revenue or help me to save costs so I have an economic benefit.” - Daniel Cho
“The next value is the emotional value. How can we create a better experience for the patients and also their own staff so the staff don't get burnout.” - Daniel Cho
“Financial value, although as strong as it is, doesn't resonate with everyone.” - Daniel Cho
“Stop giving discounts for free. Always get something back from the customer.” - Daniel Cho
People/Resources Mentioned:
- Philips Healthcare: https://www.philips.com/
- Apple Watch Launch: https://www.apple.com/
- Bausch and Lomb Contact Lens Case: https://www.bausch.com/
Connect with Daniel Cho:
- LinkedIn: https://www.linkedin.com/in/danielkkcho/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 3, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/for-b2b-value-is-incremental-profit/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Lisa Thompson has corporate experience that spans software/SaaS, industrial manufacturing, life sciences/healthcare, medtech, fintech, and B2B services. Together with clients, she delivers unique, actionable solutions tailored to their organizational needs and realities leading to profitable, sustainable revenue and growth.
In this episode, Lisa shares the importance of deeply understanding the economic value your product delivers to customers and aligning it with their buying processes, highlighting that many companies fall short in these areas. Through real-world examples, Lisa shows how uncovering the true drivers of customer satisfaction can transform pricing strategies and lead to stronger, more profitable relationships.
Why you have to check out today’s podcast:
- Deep dive into the critical importance of understanding and quantifying the economic value your product delivers to customers so you gain actionable insights to refine your approach.
- Gain valuable guidance on structuring contracts, from incorporating escalators to aligning terms with customer needs, ensuring profitability and flexibility in volatile markets.
- Learn how to evaluate and select pricing metrics that truly reflect the value customers derive, unlocking hidden revenue opportunities.
"In the metric, understand how you currently charge customers. Not the price level, but the price metric. Double check to see if that aligns with whether they get high value or low value. If it doesn't, we don't necessarily have the right metric. There can be magic and a lot of money in getting the metric right."
- Lisa Thompson
Topics Covered:
01:43 - How she ended up in pricing
03:44 - Why value-based pricing is not simply charging higher prices for more value
05:32 - Highlighting the nuances in pricing strategies, explaining ways to leverage value other than higher prices
11:39 - Sharing a lighthearted story about Tom Nagle's amusing moments
13:37 - Emphasizing what many companies struggle to do with deal structuring
16:50 - Explaining why understanding the economic value of a product must come hand in hand with a deep knowledge of the customer's buying process
23:02 - The need for long-term contracts to include appropriate escalators and de-escalators
26:54 - Why contract structures should align with how customers perceive and experience value
30:59 - Lisa's best pricing advice
Key Takeaways:
"Just because value's high, it doesn't mean I can always get a high price for it." - Lisa Thompson
"One of the things I want people to understand in our work is that getting a price premium or charging more than you used to charge isn't the only way to get paid for adding more value." - Lisa Thompson
"We know the value, but that's not the same thing as knowing the buying process." - Lisa Thompson
People/Resources Mentioned:
- Tom Nagle: https://impactpricing.com/podcast/604-insights-into-value-based-pricing-strategies-for-b2b-with-tom-nagle/
- Reed Holden: https://impactpricing.com/podcast/ep97-pricing-in-the-new-normal-with-reed-holden/
- Gilette: https://gillette.com
Connect with Lisa Thompson:
- LinkedIn: https://www.linkedin.com/in/lisa-spadafora-thompson/
- Email: LThompson@sturbridgegrowthpartners.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 23, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-new-products-myth-1/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Every decision can make or break profitability, and pricing remains one of the most powerful yet underutilized levers. There is fear that often holds companies back from taking bold steps in pricing. How about getting a proven playbook to guide you?
Get to have a peek at Mark Stiving's groundbreaking new book, Instant Profits: How to Raise Prices Without Losing Customers.
In this episode, together with Mark and guest-host, Rebecca Kalogeris, we explore how this concise, impactful guide empowers executives and decision-makers to conquer pricing fears, implement value-based strategies, and unlock untapped revenue potential—all in under an hour of reading. Let's bring your pricing game to a whole new level and make a lasting impact.
Why you have to check out today’s podcast:
- Gain access to the behind-the-scenes of the making of Instant Profits book and how it showcases a concise, actionable guide that can help executives make meaningful changes in their companies.
- Delve into the common fear of raising prices and gain actionable strategies to address it and boost your revenue confidently.
- Learn how to price based on the value delivered rather than arbitrary metrics in order to optimize profitability.
"If you are an executive, this book is awesome because it gives you a chance to read about what you could or should be doing in pricing, and you can do it in less than an hour. Come up with at least one or two ideas of things you can go do, and it's going to make the company money."
- Mark Stiving
Topics Covered:
01:43 - The reason why Mark wrote the book, Instant Profits: How to Raise Prices Without Losing Customers
03:18 - Mark highlighting how fear of raising prices can hinder action
04:47 - How his new book, Instant Profits: How to Raise Prices Without Losing Customers differ from the previous one
06:05 - Why you should go and buy this book for $100 and who should purchase and read it
08:05 - Rebecca explaining Amazon's royalty system and the real reason why the book is priced at $100
10:40 - Kindle version available for now and why the hardcover is still to be released
13:30 - Mark emphasizing what makes this book an invaluable and concise resource for executives
Key Takeaways:
“If you are an executive, this book is awesome because it gives you a chance to read about what you could or should be doing in pricing. And you can do it in less than an hour. Come up with at least one or two ideas of things you can do and it's going to make the company money.” - Mark Stiving
“The reason I'm charging a hundred dollars isn't because I need the 30 bucks or the 70 bucks or something like that. The reason we're charging a hundred dollars is because I want buyers to know that it's worth a hundred dollars. That's it.” - Mark Stiving
People/ Resources Mentioned:
- Instant Profits: How to Raise Prices Without Losing Customers by Mark Stiving: https://impactpricing.com/instant-profits-book/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 19, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-you-reduced-prices-without-you-or-customers-realizing-it/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mike Danford is a Growth Optimizer - CSO, UX Strategist and Product Management Consultant at Adverio.io
In this podcast, Mike shares valuable insights on optimizing pricing strategies for businesses, emphasizing the importance of testing and adjusting prices regularly to stay competitive. He discusses the complexities of Amazon's Buy Box. He also provides practical advice for businesses with tight margins, highlighting how small pricing adjustments can lead to significant improvements in profitability, especially when using dynamic pricing strategies.
Why you have to check out today’s podcast:
- Gain actionable strategies for optimizing pricing in competitive markets with concrete examples of how small pricing changes can impact profits.
- Learn about the complexities of Amazon’s Buy Box, including how pricing, seller ratings, and competition affect your visibility and sales potential.
- Discover how to leverage dynamic and intraday pricing strategies to stay competitive, including tips on when and how to make real-time price adjustments.
"If you haven't tested pricing, do it today. Don't wait. There's no better time than right now."
- Mike Danford
Topics Covered:
01:36 - What paved his entry into pricing
02:21 - Explaining how in B2C dynamic pricing is critical to staying competitive across platforms like Amazon and Walmart, where frequent promotions and price changes impact rank and visibility
03:27 - Defining 'Omnichannel'
03:59 - How brands sell through these omni channels and how brick-and-mortar sales data can be integrated with online data to enhance omnichannel strategies
05:03 - 'Omnichannel pricing' and the challenges that comes with it
07:20 - A strategy used to avoid direct price comparison
07:45 - Strategies for effective omnichannel pricing to maximize sales
12:00 - Describing how price adjustments are often small, typically starting below 3% to gauge elasticity
13:52 - The three main buckets of categorizing pricing strategy
16:15 - Explaining Amazon's automated pricing tools and third-party repricing software that generally adjust prices dynamically
18:55 - How the Amazon buy box has been a competitive issue since the platform’s early days
21:20 - Hourly changes being typically unnecessary unless there’s exceptionally high product turnover
23:25 - How geolocation-based pricing isn’t possible on major marketplaces
25:08 - Maintaining control over the buy box on Amazon
26:27 - Mike's best pricing advice
Key Takeaways:
“If you haven't tested pricing, do it today. Don't wait. There's no better time than right now. If you tested it a year ago and you haven't touched it, or you did it six months ago, do it again. The market is constantly changing. Be willing to make those small changes.” - Mike Danford
People/Resources Mentioned:
- Amazon: https://www.amazon.com
- Home Depot: https://en.wikipedia.org/wiki/Home
- Walmart: https://www.walmart.com
- Best Buy: https://www.bestbuy.com
- Target: https://www.target.com
Connect with Mike Danford:
- Linked: https://www.linkedin.com/in/danfordmike/
- Website: https://www.adverio.io/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 12, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/mastering-the-good-better-best-strategy-a-guide-to-increasing-win-rates-and-revenue/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Boundy is a business builder, sales leader, author, coach, consultant, teacher…and Chief Clarity Officer…he has grown businesses in a variety of industries using a relentless focus on customer-perceived value.
In this episode, Mark discusses the importance of aligning every employee's actions with customer value, emphasizing that every touchpoint with a customer either creates or destroys value. He shares stories from his experience, including a manufacturing operator and a receptionist, to illustrate how seemingly small ideas can have significant impacts on customer satisfaction and business outcomes. Boundy underscores that value creation is about helping customers achieve desired outcomes, and this focus can drive growth, profitability, and employee fulfillment across all levels of an organization.
Why you have to check out today’s podcast:
- Discover real-life stories about how employees at every level, from operators to receptionists, can innovate to drive customer satisfaction and business results, making it relatable and motivating.
- Gain actionable strategies to ensure every team member understands how their role impacts customer value, helping you foster a culture focused on positive customer experiences.
- Learn how traditional metrics can sometimes hinder value creation, providing tips on aligning KPIs with customer-centric goals to achieve greater long-term success.
"Customer value comes from two things, one, your differentiation, and two, the outcome that customer achieves because of your differentiation."
- Mark Boundy
Topics Covered:
01:25 - Sharing the experience that gave rise to using the word 'antipreneurial' in his book
04:08 - The importance of flexibility within processes, contrasting rigid corporate guidelines with adaptable checklists
07:41 - Stressing the importance of a value-oriented organization not just sales around delivering customer outcomes
09:14 - Highlighting the importance of aligning sales and implementation teams to ensure realistic promises are made to customers
12:39 - What it requires to create a value-driven organization
16:09 - Emphasizing the need to prioritize customer-focused KPIs over purely efficiency-driven ones with real-life illustrations
20:12 - How focusing on customer satisfaction and adding value leads to substantial growth, high profitability, and employee satisfaction
21:35 - Stressing a point that employees feel more fulfilled and engaged when they understand how their work directly impacts customers’ lives
22:51 - Defining value and illustrating how value was created by understanding customer outcomes deeply
26:51 - Mark sharing how anyone in the company, even janitors and receptionists can add value
Key Takeaways:
"If the most important process in your company is your customer's buying journey, and your KPI has nothing to do with that buying journey, that's a yellow light." - Mark Boundy
"If maximizing that KPI inhibits the customer journey, I call that a masking KPI. You're measuring something that makes you worse by making yourself good at stopping the customer from complaining. You get bad at turning customers into joyous partners." - Mark Boundy
People/Resources Mentioned:
- The Infinity Effect How Elite Growth Companies Abolish Antipreneurial Patterns and Create More Profitable, Happy, Lifetime Customers by Mark Boundy: https://www.amazon.com/Infinity-Effect-Summary-Antipreneurial-Profitable-ebook/dp/B0D1NNLWRH
- Lucent technologies: https://lucenttek.com/index.html
- Cisco: https://www.cisco.com/#tabs-35d568e0ff-item-194f491212-tab
- Miller Heiman Group: https://www.kornferry.com/about-us/our-story/miller-heiman-group
- Zappos: https://www.zappos.com
- Barefoot Wines: https://www.barefootwine.com
Connect with Mark Boundy:
- LinkedIn: https://www.linkedin.com/in/markboundy/
- Website: www.boundyconsulting.com
- Email: mark@boundyconsulting.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 5, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/uncover-hidden-profits-with-our-opportunity-signals-worksheet/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business.
In this episode, Steven emphasizes the importance of shaping willingness to pay by understanding and communicating real value to customers. He also highlights the role of AI and context-driven pricing in adapting to customer needs dynamically, stressing that consistent delivery and documentation of promised value are crucial for long-term retention.
Why you have to check out today’s podcast:
- Explore the nuances of pricing strategies, distinguishing between perceived, real, and proven value and how each impacts customer retention and willingness to pay.
- Learn why documenting value delivered to customers can significantly reduce churn, with actionable steps to demonstrate value in B2B sales.
- Gain insights on Context-Driven Pricing, offering a fresh approach to optimize pricing in real time.
"You need to make sure that the value you promise in sales is the value that you deliver and that you can document that value. Because if you don't do that, you're going to struggle with renewals."
- Steven Forth
Topics Covered:
02:09 - Why Steven believes that value-based pricing and willingness to pay are distinct, with value coming first shaping willingness to pay
06:19 - How techniques from behavioral economics, like anchoring, actually impact value perception rather than solely increasing willingness to pay
07:12 - Acknowledging Mark's example of using "good-better-best" as a framing strategy but argues that it’s more than just a "trick"
10:40 - Introducing his concept of generative pricing, which leverages generative AI to dynamically adjust product configurations and prices based on each buyer’s context
12:35 - Steven emphasizes the need for a clear value model rather than solely relying on AI-driven willingness-to-pay estimates
14:49 - Highlights how value is not only unique to each customer but also varies over time for the same customer
17:05 - Underscoring that willingness to pay is actively shaped by how a company communicates and delivers value
18:34 - Emphasizes the need for a value model in pricing, contrasting it with software approaches like revenue management that estimate willingness to pay without actively shaping it
20:37 - Explaining why B2B pricing cannot rely on traditional price elasticity curves
21:36 - Steven's best pricing advice
Key Takeaways:
"Willingness to pay is an outcome that you shape. It's not something that is given to you by something outside of your product and how you sell it, and that you play a huge role in defining the context." - Steven Forth
"We want people to pay a fair amount of money. If I can trick someone into paying more than something's valuable, greater than its actual value, and value in this case means the economic return they're going to get, I don't think I've done myself a service in the long term." - Steven Forth
People/Resources Mentioned:
- Pros: https://pros.com
- Pricefx: https://www.pricefx.com
- Zilliant: https://zilliant.com
- Vendavo: https://www.vendavo.com
- Tom Nagle: https://impactpricing.com/podcast/604-insights-into-value-based-pricing-strategies-for-b2b-with-tom-nagle/
- Barret Thompson: https://impactpricing.com/?s=barrett+thompson
- B.F. Skinner: https://en.wikipedia.org/wiki/B._F._Skinner
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 29, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/better-stories-better-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
George Boretos has over 25 years of professional experience in leadership positions in the enterprise software market, a deep understanding of AI technologies, and a successful journey as an entrepreneur launching three startups and raising $9mn in Seed & Series A funding, working with Fortune 500 and other customers worldwide. His most recent endeavor, FutureUP, brings in this experience to help enterprises make data-driven decisions to optimize pricing, improve profitability, and accelerate growth.
In this episode, George shares about using AI for price optimization, particularly in SaaS and manufacturing industries. He explains how his company, FutureUP, helps businesses analyze customer and macroeconomic data to determine optimal pricing strategies, focusing on standardized products. He also discusses AI’s role in predicting pricing for new markets and the importance of taking the first step to review and adjust prices regularly.
Why you have to check out today’s podcast:
- Learn how AI is revolutionizing pricing strategies, particularly in SaaS and manufacturing sectors.
- Gain a deeper understanding of the key differences between pricing in B2B and B2C markets, including negotiation tactics, price variance, and strategic vs. deal-based pricing.
- Discover practical advice on how to approach pricing in your business, including why regular pricing reviews and value-based pricing can make a big impact.
"Just start doing something. Even if this something is, okay, reexamine your prices. Not once per two years or per year, examine them every quarter of a year, at least. Not just your cost plus your margin, do something a bit more sophisticated. Ask your customers, for instance, or your partners to establish some other benchmarks and interesting price points."
- George Boretos
Topics Covered:
01:32 - How he got started in pricing and how he initially got into AI before pricing
03:39 - The differences between AI when he started versus today’s advanced tools
05:57 - Describing his AI model and how it integrates various parameters at multiple levels
08:06 - Clarifying the common perception of AI being synonymous with neural networks as a misconception
11:04 - Explaining that for his particular model, the formulas are pre-existing and universal
12:31 - Agreeing that AI today can incorporate both internal company data and external factors
14:07 - What his company FutureUP is built out for
17:42 - How extrapolating data from one country to another can be challenging if the data sample is small
19:10 - Explaining how his company, FutureUP’s model can handle both B2B and B2C markets
20:15 - Key differences between B2B and B2C pricing strategies
22:47 - How price variance is more common in B2B though in B2C there can still be significant price differences between list and actual price
23:35 - What company size does FutureUP typically targets
24:32 - George's best pricing advice
26:18 - Two main reasons companies don't often prioritize or experiment with pricing
27:55 - Why change management is crucial in pricing decisions
Key Takeaways:
"I do believe, and I do agree that the negotiation part and the discounting part is more complex and more interesting and more important for the B2B environment. The list prices are almost irrelevant." - George Boretos
People/Resources Mentioned:
- FutureUP: https://www.futureup.io
Connect with George Boretos:
- LinkedIn: https://www.linkedin.com/in/georgeboretos/overlay/contact-info/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 22, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/evils-of-behavioral-economics/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Stephen Plume has more than 20 years of success in venture, executive leadership, and consulting. He is a General Partner of an early-stage venture fund since 2019, driving business strategy and coaching executives in the portfolio.
In this episode, Stephen discusses how AI is shifting pricing models from human-based to consumption-based metrics. He emphasizes the importance of identifying the right value metric that resonates with customers encouraging businesses to experiment with pricing to uncover hidden revenue and margin opportunities.
Why you have to check out today’s podcast:
- Gain insights into the cutting-edge pricing strategies for AI companies and how these differ from traditional user-based models to get a glimpse of the future of tech pricing.
- Learn about actionable strategies like identifying the right value metric and conducting low-risk pricing experiments, which can help businesses capture hidden revenue and improve margins.
- Deep dive into how venture capitalists think about returns, risk, and value, which can benefit entrepreneurs and business owners seeking to understand how to attract investment.
"There is so much opportunity to learn from low-risk pricing experiments, and people worry so much about their reputation. Get over that feeling, go out and experiment, and learn from it."
- Stephen Plume
Topics Covered:
01:54 - A funny thing about Stephen not related to pricing
02:46 - How he found his way into pricing
04:21 - Reflecting on his first pricing project with Sybase
05:57 - Contrasting enterprise-level pricing with startup pricing, highlighting the complexity of pricing for larger companies
09:12 - The importance of focusing on the Ideal Customer Profile (ICP) for early-stage companies
10:39 - Explaining how companies often face pricing erosion as they grow and introducing the concept of 'layering' and 'fencing'
16:38 - Discussing how companies, like HubSpot and Salesforce, often start by solving a specific problem with a focused solution but later expand by adding numerous features and add-ons
17:27 - Delving into the concept of competitive positioning
21:40 - The importance of delivering significant value to customers to motivate a decision to switch from a competitor or the status quo
25:09 - Sharing insights about pricing for AI companies and broader trends in AI adoption
29:14 - Discussing the concept of pricing metrics in the context of AI and SaaS
30:32 - Stephen's best pricing advice
Key Takeaways:
"When I'm working with early stage companies my drumbeat is, don't worry about anybody else right now, worry about your ideal customer profile. Because they are the ones who, by definition because math is a thing, will pay you more money faster than anyone else." - Stephen Plume
"In the venture world what I tell the early companies I work with is, for someone to take a bet on you, they're expecting venture returns. They need to be getting 10X their money out. That's not just the investors. That's the customers need to be getting 10X their cost out, or they're not going to adopt you." - Stephen Plume
"The advantage of a platform growing to solutions is, if you do it right, your margins improve rather dramatically." - Stephen Plume
People/Resources Mentioned:
- Sybase: https://en.wikipedia.org/wiki/Sybase
- Salesforce: https://www.salesforce.com/ap/?ir=1
- Cisco: https://www.cisco.com/#tabs-35d568e0ff-item-194f491212-tab
- Regis McKenna: https://en.wikipedia.org/wiki/Regis_McKenna
- Geoffrey Moore: http://geoffreyamoore.com
- Steve Blank: https://steveblank.com
- HubSpot: https://www.hubspot.com
- Zoom: https://zoom.us
- LinkedIn: https://www.linkedin.com
- Siebel: https://www.oracle.com/ph/cx/siebel/
- Zendesk: https://www.zendesk.com
- Intercom: https://www.intercom.com
- Clayton Christensen: https://en.wikipedia.org/wiki/Clayton_Christensen
Connect with Stephen Plume:
- LinkedIn: https://www.linkedin.com/in/stephenplume/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 15, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-based-pricing-a-simple-definition/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Barrett Thompson is a firm believer that applied advanced math and data science can significantly improve customer lifetime value. For more than 25 years, he has helped Fortune 500 companies improve profitability and grow revenues by delivering science-based, optimized decision models. He has found that relying on the accuracy and objectivity of predictive models to guide daily decisions, rather than more subjective methods, yields superior financial results for B2B companies.
In this episode, Barrett shares AI's role in pricing, how it enhances pricing strategies, identifies trends, and improves pricing decisions. He also highlights the value of understanding customer-specific needs and using data to create more tailored and effective pricing models.
Why you have to check out today’s podcast:
- Deep dive into how AI, particularly tools like ChatGPT, can revolutionize pricing strategies, making it more efficient, transparent, and data-driven.
- Gain valuable advice on how B2B companies can simplify and modernize their pricing processes, avoiding the pitfalls of outdated methods when adopting new pricing systems.
- Have a clear understanding of how to effectively implement purpose-built pricing tools to enhance profitability and competitiveness.
"If they undertake an automation of their pricing process into these modern purpose-built pricing tools, they should look very closely and critically at how to simplify their pricing process as they put that onto a superior platform."
- Barrett Thompson
Topics Covered:
01:14 - Touching a bit on the topic of the Boy Scouts program and how it is a valuable tool for character development and citizenship
01:51 - How he found a path into pricing
03:26 - Discussing the qualitative and not just the quantitative aspect to pricing
05:17 - How automated pricing systems can balance efficiency and personalization
09:14 - Explaining how AI holds great potential in generating "smart prices"
11:36 - Reflecting on the rise of generative AI and how AI in general has already influenced pricing systems
13:50 - Exploring the potential of generative AI to enhance negotiation and communication in B2B sales
15:35 - Discussing how understanding a customer's specific use case or application can directly influence pricing decisions
16:33 - Talking about how understanding a customer's specific use case or application can directly influence pricing decisions
17:57 - Highlighting how AI, like ChatGPT, can enhance tools used by pricing professionals by streamlining the process of analyzing pricing data
20:41 - Addressing the "black box" problem in pricing systems and expanding on the idea of using AI to explain its own decisions
24:14 - The importance of deepening the understanding of customer needs, particularly as the push for touchless and self-service channels grows
28:43 - Barrett's best pricing advice
Key Takeaways:
"An important part of setting up any price guidance, price recommendation or price automation system is to ensure that you've identified the factors that were really important in driving price outcomes in the market." - Barrett Thompson
"Pricing becomes a consequence of having agreed on the value and why it matters." - Barrett Thompson
"We gather data to enrich the relationship and define places to add more value to the customer. Yes, the seller should be compensated for fair value, but not to be exploitative." - Barrett Thompson
People/Resources Mentioned:
- ChatGPT: https://chatgpt.com
Connect with Barret Thompson:
- LinkedIn: https://www.linkedin.com/in/barrettthompson/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 8, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-is-created-twice/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Claire Wang helps startup founders and solopreneurs pick a pricing model that ensures their long-term success.
In this episode, Claire shares her journey of transitioning into her own consulting practice after her corporate job. She talks on the misconceptions about pricing, how people mistakenly equate pricing with just setting a price point when it's all about understanding customer value. She emphasizes the importance of integrating pricing early on in product development, not as an afterthought. She also highlights the need for pricing professionals to be more visible and vocal about the value they bring, as many people don't understand the full scope of their work.
Why you have to check out today’s podcast:
- Discover the common misconception that pricing is just about setting a number and uncover how it is deeply intertwined with customer value and business strategy.
- Gain insights on what’s missing in the pricing industry and how professionals can elevate the value of their role.
- Learn how pricing should be integrated into product design and customer understanding aligning business goals with customer satisfaction.
"Understand your customers, understand their needs. And once you do that, then you'll have a better understanding about their willingness to pay."
- Claire Wang
Topics Covered:
01:34 - How she found herself in pricing
02:12 - Pricing as it relates to actuary
03:57 - Explaining the cost-plus pricing in the world of insurance
06:57 - Discussing about price sensitivity and willingness to pay with regard to insurance
08:09 - Reason behind starting her consulting firm
10:02 - The misconception about pricing and what it truly is
14:46 - How success of pricing strategies often depends on how integrated pricing is within a company's overall operations
16:49 - Pricing being more than just setting a number
18:20 - Claire making her point that pricing should not be viewed as a zero-sum game
23:45 - Sharing her thoughts on building visibility for pricing professionals to raise awareness about the pricing profession
25:56 - Gauging perceived value of pricing professionals based on their visibility and content
27:34 - Claire's best pricing advice
Key Takeaways:
"Most people have no clue what pricing really is. They equate pricing with setting a price point, which is completely untrue." - Claire Wang
"Pricing, fundamentally, is all about value." - Claire Wang
"Pricing has got nothing to do with the price point. You really need to go through the whole funnel. And once you've done that, then the price point is just a byproduct." - Claire Wang
People/Resources Mentioned:
- Allstate Insurance: https://www.allstate.com
- Telstra: https://www.telstra.com.au
Connect with Claire Wang:
- LinkedIn: https://www.linkedin.com/in/claire-wang/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 1, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/southwest-airlines-new-seating-strategy-a-billion-dollar-decision/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
With over six years of experience as a leader in marketing operations, Nathan Yeung helps mid-market businesses build, enhance, or support their marketing functions and drive value creation. As the Vice President, CMO Services at Find Your Audience Marketing Partner, he leads teams of marketing managers, graphic designers, media buyers, coordinators, and freelancers to develop and implement marketing strategies for organizations across various industries.
In this episode, Nathan shares how empathy is crucial for understanding and communicating value, which directly influences pricing and client trust. He emphasized that many web pages fail because they attempt to appeal to everyone rather than focus on a specific audience and problem. Additionally, he advised against charging too little, suggesting that higher rates can be justified when trust is established, and recommends offering multiple pricing options to highlight the value of the primary choice.
Why you have to check out today’s podcast:
- Learn to understand and address your customers' pain points to significantly impact your pricing strategy and boost trust, leading to higher revenue.
- Find out why many web pages fail to convert and get actionable advice on how to create focused, empathetic web content that resonates with your target audience.
- Explore how trust plays a crucial role in client relationships and how it can influence pricing decisions, helping you secure higher-value contracts.
"Never give a single price. Think about creative ways to give at least three and make your obvious choice your bottom line."
- Nathan Yeung
Topics Covered:
01:07 - Talking about his disciplined approach to health
02:01 - How he got into pricing and his perspectives on pricing
03:53 - Discussing his approach to helping B2B companies "discover revenue"
06:22 - The reactions and learning opportunities that come when a client quickly accepts a price offer
07:48 - The importance of truly understanding and communicating value when helping businesses discover revenue
11:17 - Value creation in B2B and B2C contexts
14:03 - Expanding on the concept of having marketing take on internal communications
15:08 - Two key issues why web pages fail and bringing in additional point about the "curse of knowledge"
18:22 - Discusses the concept of pricing and positioning in business
22:22 - Trust and how it relates to pricing and business growth
23:04 - Talking about his book, 'The Lazy Consumer', and discussing the concept of trust
24:49 - Elaborating on the importance of empathy in sales and how it can trigger a response from customers
25:53 - Underscoring the crucial link between trust and pricing
27:20 - Nathan's best pricing advice
Key Takeaways:
"When you forget about that [people are human], you get a lot of people locked into this state of logical thinking. And when you're too logical, it's hard to generate a lot of value. Because when they're logical, they're being highly critical." - Nathan Yeung
"Understanding your ideal customer profile and really understanding their true pain points and where they are in a business, you can understand value." - Nathan Yeung
"Value makes you really be empathetic, and you really have to understand what is valuable to your customer." - Nathan Yeung
"Just because there's a quantifiable change that is valuable, that does not necessarily mean that person values that the most." - Nathan Yeung
"HR is great for compliance and process and all that kind of lovely stuff, but they're really not great marketers." - Nathan Yeung
"This idea of building culture, while it's important for HR to take care of that and be the accountable part of that, the reality is that marketers are likely the more important person to actually bring that message to market, which is the company in itself." - Nathan Yeung
Connect with Nathan Yeung:
- LinkedIn: https://www.linkedin.com/in/yeungnathan/
- Website: https://www.findyouraudience.online/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 25, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/stop-pre-discounting/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Frank Luby is a writing partner and editor for business books, articles, and corporate communication and co-founder and CEO at Present Tense LLC.
In this episode, Frank emphasizes the importance of clear and effective writing for pricing professionals, offering techniques like the "10-10" and "Rule of 13" methods to structure writing efficiently. He highlights how good writing can influence decision-making within organizations, often reaching and persuading people beyond initial conversations. Additionally, he underscores the value of listening to customers and understanding their real needs, which can significantly enhance pricing strategies and company success.
Why you have to check out today’s podcast:
- Discover practical writing tips and actionable strategies to help you organize and improve your writing, making it more persuasive and impactful.
- Learn how writing plays a crucial role in influencing and shifting thinking within organizations amplifying your message beyond one-on-one conversations.
- Gain insights on structuring effective communication, prioritizing the right information in your writing and focusing on making a single point effectively.
"Truly, honestly, listen to customers."
- Frank Luby
Topics Covered:
01:33 - How he got into pricing
03:23 - What's his contribution in Hermann Simon's book on pricing
04:21 - Noting two challenging tasks that makes writing about pricing difficult
05:39 - Acknowledging the complexity of the term "value" in pricing
07:36 - Deciding which narrative perspective to use in writing between blogs and books
09:15 - An effective writing technique to engage readers
10:05 - What his role is at the upcoming PPS (Professional Pricing Society) conference
12:09 - Why a pricing director or manager should care about improving their writing skills, even if they feel confident writing emails
14:10 - How writing can have a greater influence than many people realize
15:46 - Sharing two key writing approaches to help people organize their thoughts effectively
18:50 - Comparing writing to architecture
20:03 - Explaining the "Rule of 13" method as a way to test whether a chapter idea can stand alone
21:21 - The concept of prioritizing writing tasks using the acronym "CSR”.
23:01 - Importance of understanding your audience, especially when trying to shift or replace existing strategies in pricing
25:53 - Introducing the 50/500 rule: Making a single, clear point in writing
27:31 - Frank's best pricing advice.
28:24 - Why businesses often don't listen to their customers, despite it being an obvious necessity
Key Takeaways:
"I often make the analogy to writing an architecture. And you wouldn't want somebody building your house just by having a bunch of bricks and cement and two by fours delivered. You'd like to see a plan, you'd like to see what they're going to design. And it's hard to change things later on. So, that planning part, especially for a book, is immensely important." - Frank Luby
"That's where this 13-method comes in where you can test some of those things that if you can't have those three supporting pieces, or three examples or three ways to elaborate on a particular point, that's your signal right off the bat that that might not carry a chapter." - Frank Luby
"The other hint is prioritizing what you want to write about." - Frank Luby
"We love simplification and we love to have simple answers and simple descriptions, and no segment of customers, or no individual customer, is really that simple. So, we pick up on the things that we can make easy groups out of and we tend to ignore the rest. And sometimes, the rest we're ignoring is really the vital part of the equation." - Frank Luby
People/Resources Mentioned:
- Hermann Simon: https://hermannsimon.com
- Price Management: Strategy, Analysis, Decision, Implementation: https://www.amazon.com/Price-Management-Strategy-Analysis-Implementation/dp/3319994557
- Dow Jones: https://www.dowjones.com/about/
- David Brooks: https://www.nytimes.com/column/david-brooks
Connect with Frank Luby:
- LinkedIn: https://www.linkedin.com/in/frank-luby-318220/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 18, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-5-ws-of-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Tim Hanni is a trailblazer in the wine industry, renowned for his groundbreaking work in wine education, sensory sciences, and his mission to demystify wine for all. With the prestigious title of Master of Wine, Hanni holds the distinction of being one of the first Americans to earn this credential, marking a significant milestone in his illustrious career.
In this episode, Tim shares how perceptions of wine quality are influenced more by psychological and sensory factors than by price, often making expensive wines indistinguishable from cheaper ones in blind tastings. He introduces the concept of "perceptual individualism," explaining how personal differences in taste perception affect wine preferences. Additionally, he highlights the complexities of wine pricing, contrasting the traditional cost-plus approach with the need to consider market perceptions and branding.
Why you have to check out today’s podcast:
- Gain insights into wine perception and psychology.
- Discover the challenges of traditional wine wisdom to understand the wine industry's myths and realities.
- Learn a comprehensive view on wine pricing contrasting cost-plus pricing with value-based pricing to help you gain insights into the factors that influence wine prices, including production costs, marketing, and consumer perception.
"There are people who buy out on price alone. If it's more expensive, it must be better. But there's an inverse relationship between price and quality."
- Tim Hanni
Topics Covered:
02:01 - Discussing the unique nature of wine pricing and how it affects consumer behavior
04:19 - Talking about the impact of wealthy individuals, particularly those from Silicon Valley, entering the wine industry, which he describes as being over-premiumized
06:22 - Discussing the challenges of market segmentation in the wine industry, comparing it to the evolution of the tech industry
10:22 - Critiquing the wine industry's elitism and rigidity, using examples to illustrate how misleading some widely accepted norms are
12:18 - The background and story of 'Two-Buck Chuck'
13:52 - Addressing the often-debated relationship between wine quality and price
16:30 - Introducing the concept of "perceptual individualism"
20:13 - Elaborating on a wine study conducted by Frédéric Brochet at the University of Bordeaux in 2001
24:32 - How wine pricing is determined, focusing on what he refers to as the "bottom-up approach."
25:48 - Explaining the complexities of wine pricing and how factors beyond production costs influence the final price of a bottle
28:07 - How the complexity of pricing wine remains somewhat elusive
Key Takeaways:
“The label's not going to make necessarily all that much of a difference in the margin, but the label plus the provenance." - Tim Hanni
“Unequivocally, sweet wine drinkers have the most taste buds. They have the highest perceptual acuity of any consumers at all. And often you are paying an extreme premium for that sweet wine.” - Tim Hanni
People/Resources Mentioned:
- Julia Child: https://en.wikipedia.org/wiki/Julia_Child
- Trader Joe's: https://www.traderjoes.com/home
- Fred Franzia: https://en.wikipedia.org/wiki/Fred_Franzia
- Charles F. Shaw: https://en.wikipedia.org/wiki/Charles_F._Shaw
- California State Fair Wine Competition: https://calexpostatefair.com/competitions/california-commercial-wine/
- Joel Butler: https://www.linkedin.com/in/joel-butler-mw-1697667/
- Frederic Brochet: https://www.researchgate.net/scientific-contributions/Frederic-Brochet-2029425754
- California Grape Crush Report: https://www.nass.usda.gov/Statistics_by_State/California/Publications/Specialty_and_Other_Releases/Grapes/Crush/Final/2023/2023_Final_Grape_Crush_Report.pdf
- Robert Parker: https://www.robertparker.com/about/the-rating-system
Connect with Tim Hanni:
- LinkedIn: https://www.linkedin.com/in/timhannimw/
- Website: https://winebusinesseducation.com/
- Website: https://www.myvinotype.com/en/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 11, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/high-prices-and-lost-deals/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Christine Nicholson has a 25-year experience of running companies in multiple sectors. She started, built, and exited multiple successful businesses. She took a business from £0-£4.5m turnover in 15 months. And she also rescued a bankrupt company from millions in debt to an eight-figure exit in under 18 months. More than just experience, she studied hard to become a Chartered Management Accountant with a law degree, a postgraduate degree in Information Systems Management - and a Professionally Accredited and Experienced Business Mentor.
In this episode, Christine shares valuable insights on several key topics related to business valuation and pricing like the owner's emotional attachment, preparing a business for sale and customer feedback for pricing strategies. She provides a balanced view of how to strategically prepare a business for sale, emphasizing the importance of logical pricing decisions and understanding customer value perceptions.
Why you have to check out today’s podcast:
- Gain insights on emotional influence in business decisions to help you make more informed, rational decisions that enhance your company's value.
- Discover actionable tips on how to boost a company's valuation by implementing effective pricing strategies.
- Learn the importance of customer engagement to understand their perception of value for better pricing decisions.
"Go and ask your customers what they think of your service. If you were no longer providing this service, what would they be willing to pay for the level of service that they get from someone else?"
- Christine Nicholson
Topics Covered:
01:02 - How did she get involved in pricing
03:20 - Discussing a common misconception among business owners regarding the value of their businesses
03:51 - Highlighting a scenario of the emotional complexities and the challenges business owners face when selling their businesses
12:22 - The psychological dynamics involved when business owners try to value their businesses and their services
14:37 - Explaining the key factors that sophisticated buyers look for when purchasing a company
17:22 - Deeper motivations tied to personal beliefs and values other than price when selling a business
19:40 - How adjusting pricing is one of the quickest and easiest ways to improve a business
22:05 - Christine's approach to helping companies fix their pricing strategies which involves more than simply raising prices
24:07 - Addressing the emotional and logical aspects of business decision-making
25:36 - Christine's best pricing advice
Key Takeaways:
"When you're talking directly to your customers, you have to talk with your heart because you're dealing with one human being typically to another. " - Christine Nicholson
"...if you get your pricing right, then you're going to make more profits; you're going to generate more positive cash flows." - Christine Nicholson
"When it comes to selling your business, all the heart is with the seller, and all the logic is with the buyer." - Christine Nicholson
"When people put their soul into something, they attach a value to it when they're selling their business; ironically, and completely paradoxically, they don't attach the value of the effort that they put into the business to their customers." - Christine Nicholson
"One of the biggest problems that I see from a selling business is where somebody is mentally associating the value of the business by the effort they've put in, but they're not reflecting that correctly in the way that their pricing to their customers." - Christine Nicholson
"You need to believe the value that you are giving to your client." - Christine Nicholson
"Buyers do not want to buy a job. They are buying an investment that has a hard return on capital. And the more certain they are about the return on capital, the higher the money that they will pay and the faster you'll get the cash in your bank." - Christine Nicholson
Connect with Christine Nicholson:
- LinkedIn: https://www.linkedin.com/in/christine-nicholson/
- Website: https://getexitready.co.uk/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
Patrick Taylor is a global business improvement expert with over 30 years of delivered value leveraging experience across all domains of pricing and margin improvement as well as commercial and financial processes.
In this episode, Patrick shares the critical aspects of effective pricing strategies and their impact on business profitability. He emphasizes the importance of understanding both the external market and customer needs when setting prices. He also advocates for the use of various data visualization tools, such as scatterplots and Pareto charts, to analyze pricing effectiveness and identify areas for improvement.
Why you have to check out today’s podcast:
- Gain insights into customer-focused pricing and understand market conditions when setting prices to align pricing strategies with customer expectations.
- Learn about profitability metrics and delve into the significance of monitoring profitability by customer and product.
- Understand sales team dynamics to empower sales teams with the knowledge and tools needed to confidently sell at set prices.
"Listen to your customers, look at your market, look externally first on price."
- Patrick Taylor
Topics Covered:
01:14 - Patrick describing his journey into the pricing world
04:01 - Sharing his insights on how pricing has evolved over the years and his fundamental approach to it
07:22 - Emphasizing on the importance of focusing on customer value rather than getting overly caught up in tools like Excel or AI
08:54 - How to motivate executives to focus more on the value they deliver to customers and the decisions those customers have to make
11:58 - Aligning product offerings with customer needs and maximizing revenue opportunities
13:38 - How convincing a CEO to focus on pricing requires demonstrating that there is a real problem
17:34 - Highlighting the importance of using data-driven KPIs and charts to understand pricing behavior and sales performance and important thoughts about price variance
22:09 - What is it about the Pareto chart that he considers it when doing pricing
26:24 - Discussing the importance of focusing on margin dollars over margin percentages, especially when market conditions dictate pricing
29:14 - Patrick's best pricing advice
Key Takeaways:
"At the end of the day, from a pricing perspective, the customer only cares about two things. They care about the value they get relative to what they're buying and relative to the next best competitive alternative." - Patrick Taylor
"Putting that customer first is the number one thing you've got to do." - Patrick Taylor
"You can create the best model in the world, but if it doesn't work easily for your sales team to work, they can't communicate it to their customer; it's a problem." - Patrick Taylor
People/Resources Mentioned:
- Tom Nagle: https://impactpricing.com/podcast/604-insights-into-value-based-pricing-strategies-for-b2b-with-tom-nagle/
- Alteryx: https://www.alteryx.com
- Google: https://www.google.com/?client=safari
- Tableau: https://www.tableau.com
- Pros: https://pros.com
Connect with Patrick Taylor:
- LinkedIn: https://www.linkedin.com/in/patrickjtaylor/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
David Brown is the author of "Banned Business Books, Volume 1, Pricing," a fictional account that narrates how a marketer and a pricing guru stand up and optimize the pricing function in a company.
In this episode, David shares what his book 'Banned Business Books' is all about highlighting the "Nine Boxes" framework for organizing and executing pricing strategies effectively. He emphasizes the critical role of a Pricing Council in bringing order and clarity to pricing decisions within a company. Additionally, he highlights the value of understanding customers deeply and segmenting them to optimize pricing and business outcomes.
Why you have to check out today’s podcast:
- Deep dive into the nine boxes framework, a comprehensive tool for organizing and executing pricing strategies.
- Learn the critical importance of understanding your customers as the foundation for effective pricing.
- Discover how to set up a pricing council and navigate the challenges of pricing in different organizations.
"Don't start thinking that you're going to figure out pricing by looking at margins; start with the customers."
- David Brown
Topics Covered:
01:34 - Sharing his pricing journey
03:31 - Discussing the role of finance professionals in relation to pricing and how their focus is on defending and improving margins
06:22 - What made him title his book as Banned Business Books
08:51 - Addressing a critique from Mark about the applicability of his book's content
10:26 - Elaborating on the origin and development of his "nine boxes" framework for pricing
14:09 - Discussing how different aspects of pricing, such as packaging and portfolio optimization fit within his "nine boxes" framework
16:02 - How he continues to use the "nine boxes" as a way to organize and prioritize pricing projects, especially when collaborating with a pricing council
18:07 - Sharing his insights on establishing and maintaining an effective pricing council
20:08 - Agreeing that pricing is a critical function and is often a new and somewhat undefined role
21:04 - Proposing the idea of a pricing council to a CEO
23:08 - David's best pricing advice
25:29 - What the Volume 2 of his book series will focus on
Key Takeaways:
"Price setting is critical; that's where you have the opportunity to start claiming the value that you deserve for your innovations." - David Brown
"The main thing that the Pricing Council has to have is energy and a purpose; the ones that do the best have a clear mandate, meaning that the decisions that the council takes on price are carried out and are effective across the company." - David Brown
"You want to speak with the leaders and the potential figures that are going to be in the pricing council first and understand what makes the company tick and what needs to be fixed before you start fixing things." - David Brown
People/Resources Mentioned:
- Unilever: https://www.unilever.com.ph
- Mosaic: https://www.mosaic.com/sustainability
- American Express: https://www.americanexpress.com
- Netflix: https://www.netflix.com/ph-en/
- Blackberry: https://www.blackberry.com/us/en
Connect with David Brown:
- LinkedIn: https://www.linkedin.com/in/dbrown14/
- Website: www.bannedbusinessbooks.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 4, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/understanding-fencing-googles-strategy-to-maintain-regional-pricing-for-youtube-premium/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Kristen Berman co-founded Irrational Labs, a behavioral product design company, with Dan Ariely in 2013. Irrational Labs helps companies and nonprofits understand and leverage behavioral economics to increase the health, wealth and happiness of their users.
In this episode, Kristen explores the intricacies of pricing strategies, emphasizing the importance of understanding behavioral economics to influence consumer decisions effectively. She discusses how techniques like the decoy effect, anchoring, and the power of price endings (like 99 cents) can drive customer behavior. Additionally, she highlights the challenges of pricing revolutionary products due to the lack of reference points and the creative approaches needed to establish them in the market.
Why you have to check out today’s podcast:
- Deep dive into pricing strategies like the Good-Better-Best model, the Decoy Effect, and the psychology behind price ending to help you understand how to make pricing decisions that drive customer behaviors and increase sales.
- Find out valuable perspectives on how human psychology influences purchasing decisions which is essential for anyone looking to optimize their pricing or marketing strategies.
- Discover practical advice and real-world examples to see how you can apply these concepts to your own business.
"It's all relative. So, what are customers using as a reference point? If it's off your product site, then you need to help them create a new reference point within your product site."
- Kristen Berman
Topics Covered:
01:14 - Sharing how she transitioned into behavioral economics from her role as a product manager at Intuit
03:42 - How behavioral science tie to pricing and product
06:10 - An example of how behavioral economics influence product decisions
08:50 - Explaining the concept of the "paradox of choice"
11:35 - Turning the path of least resistance into the preferred choice
14:30 - Simplifying decision-making for customers with the concept of "good, better, best" product offerings
16:42 - Explaining the decoy effect and how it influences consumer decision-making
19:09 - The reason behind the presentation of pricing options in the context of behavioral economics
22:43 - The concept of framing in sales in the context of product features and the importance of trials in subscription-based models
25:25 - How people often rely on heuristics, or mental shortcuts, when making decisions about prices
28:56 - Kristen's best pricing advice
29:28 - Various sources of reference points
31:19 - The challenge of pricing revolutionary products due to the lack of existing reference points
Key Takeaways:
"People don't come in with an understanding of the exact thing that they want to purchase at the exact moment. And so, our job is to help them understand value, and choice helps people understand value." - Kristen Berman
"We're using the heuristics on how big the number is to make a lot of fairness decisions." - Kristen Berman
"We are relative creatures. We have reference points and we use our reference points to understand value. And so, it's not just the price, it's the reference point that we're using." - Kristen Berman
People/Resources Mentioned:
- Intuit: https://quickbooks.intuit.com/
- TikTok: https://www.tiktok.com
- Airbnb: https://www.airbnb.com
- Dan Ariely: https://danariely.com/all-about-dan/
- One Medical: https://www.onemedical.com
- Steve Jobs: https://en.wikipedia.org/wiki/Steve_Jobs
- Apple: https://www.apple.com/
- YouTube: https://www.youtube.com
- Netflix: https://www.netflix.com/
- Study: https://play.google.com/store/apps/details?id=com.thesoundagency.study&hl=en_ZA&pli=1Shopify: https://www.shopify.com/ph
Connect with Kristen Berman:
- LinkedIn: https://www.linkedin.com/in/kristenberman/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 27, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-to-charge-different-customers-based-on-value-received/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Florian Bauer is an internationally sought-after expert and speaker on the subject of price psychology and behavioral pricing. He is an honorary professor at the Technical University of Munich and author of several books on price research. He also has a doctorate in Psychology at TU Darmstadt, MIT, and Harvard.
In this episode, Florian talks about how discounts can give you short-term gain but cost you long-term. He underscores that there are other means to incentivize customers without diminishing a products’ value perception. And that cashback is one thing to consider other than discounts. He also talks about buyers’ irrationalities and how to use Behavioral Economics to influence their decision-making and let it work in your favor.
Why you have to check out today’s podcast:
- Learn about the psychology of price structure and how it influences consumers’ buying behavior
- Find out what you can, what you should, and what you should not do when giving a discount
- Learn how Behavioral Economics can help you influence buyers’ decision-making and maximize your company’s profit
“If you want to price or sell something, you have to think in two dimensions. You have to think about what people want. That's the traditional value-based approach. And you have to think in the dimension of how they decide.”
- Florian Bauer
Topics Covered:
01:28 - How Florian got started in Pricing
02:25 - What the psychology of price structure is all about
03:22 - What a price structure looks like
04:12 - What’s the psychology behind using cashback than just lowering the price
06:03 - How do discounts differ from cashback
07:39 - The feeling of disconnect with cashback
08:20 - Cashback being an icing on the cake that can potentially make you feel more decided about your choice
10:02 - What’s the disadvantage of discounting
11:36 - What behavioral economics means for pricing
16:15 - Different people behave differently when it comes to decision irrationalities
18:00 - His thoughts on the ethical issue about Behavioral Economics
23:22 - What is Behavioral Economics showing us and why this works in the B2B world
25:38 - How heuristics simplify complex decisions
29:35 - Florian’s best pricing advice that can significantly impact your business
Key Takeaways:
“Never ever give a discount without anything the customer has to give in return.” - Florian Bauer
“That's the issue with discounting. It really works very well short-term. So, you have to gain short term, but you have to cost long-term.” - Florian Bauer
“If I want to sell somebody something, I need to know what he wants, or she wants, and I need to adapt my sales approach and my pricing model, potentially, to how he decides.” - Florian Bauer
“For me, the purpose of marketing, pricing, and sales is to influence decisions. So, there is no reason to have a marketing campaign or a marketing team if you would not have the idea that I can influence my customers' decision in my favor.” - Florian Bauer
“I think when we talk about value and price acceptance, it's very much a story. And there is not one story better than another one. People hate to make decisions, they want to be made decided and with some stories, they are quicker in deciding than in others.” - Florian Bauer
“Think about that you're not only selling value; you’re also managing decisions. If you keep that in mind when you design your pricing model, you also avoid the traditional clash between pricing and sales because you're also able to tell your salespeople how they can actually execute your pricing strategy to make the customers actually follow the decision or the directions you want them to.” - Florian Bauer
Resources / People Mentioned:
- Daniel Kahneman: https://en.wikipedia.org/wiki/Daniel_Kahneman
Connect with Florian Bauer:
- Email: florian.bauer@vocatus.de
- LinkedIn: https://www.linkedin.com/in/profdrflorianbauer/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 20, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/revamp-your-pricing-strategy-pros-cons-of-4-popular-models/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business.
In this episode, Steven explores the concept of generative pricing, emphasizing how AI can transform pricing strategies through real-time value measurement and dynamic proposal evaluation. He discusses how composable AI applications and generative adversarial networks might drive advancements in pricing and proposal management. Practical advice is also provided on using AI to optimize proposals, including developing effective evaluation rubrics and leveraging AI for better decision-making.
Why you have to check out today’s podcast:
- Delves into the concept of generative pricing and how it can revolutionize pricing strategies through real-time value measurement, composability, and AI-driven proposal evaluation.
- Discover actionable advice on using AI to evaluate and improve proposals before submission which includes tips on developing effective rubrics and using AI tools to enhance proposal quality.
- Explore the future of pricing in a world increasingly influenced by AI, including the challenges of scaling costs, measuring value, and managing pricing with AI.
"Build a system that will evaluate your proposals, including your pricing proposals, before you send them out. You can do this using your currently available AI tools."
- Steven Forth
Topics Covered:
01:01 - Introducing the concept of "generative pricing" in the context of generative AI applications
02:17 - Elaborating on the concept of generative pricing by discussing the cost dynamics associated with generative AI applications compared to traditional SaaS applications
04:35 - Discussing the differences in cost between traditional search engines like Google and AI-powered services like Perplexity, highlighting the implications for generative pricing
09:28 - Shift in cost structures and the emerging properties of generative AI applications
13:54 - Configuring solutions that optimize the value delivered to customers continuously
16:02 - The potential for generative AI to enable more accurate and transparent value-based pricing models
18:41 - Explore the concept of generative pricing in the context of proposals and outcome-based pricing
22:10 - The idea of making predictions about the future of pricing, particularly in the context of generative AI, using a website called longbets.com
23:01 - How generative pricing necessitates a rethinking of pricing approaches
24:01 - Generative AI and how it affects cost management and value capture
25:30 - Discussing the implications of generative AI on the value and pricing of applications, particularly focusing on composable AI
28:42 - Steven's best pricing advice and actionable steps for leveraging AI in proposal evaluation and improvement
Key Takeaways:
"Yes, we have to be aware of costs. And the pricing systems are also going to need to be cost-management systems. But what's going to drive the configuration is value optimization." - Steven Forth
"Is generative pricing a clear, fully baked concept today? No, it's not. But I believe that generative AI is going to cause enough change that it's going to force us to rethink how we approach pricing." - Steven Forth
"...possibly as we get more sophisticated and flexible models, we'll be able to more formally manage the relationship between emotional values and also do a better job of pricing in order to reflect externalities." - Steven Forth
"We're going to have to really start designing our proposals and our pricing with the assumption that the consumer or one of the consumers is actually going to be an AI. And I think that also changes how we think about the pricing as well, and we're gonna need AIs in order to generate pricing that other AIs are going to accept." - Steven Forth
People/Resources Mentioned:
- Intercom: https://www.intercom.com
- Perplexity: https://www.perplexity.ai
- Google: https://www.google.com/?client=safari
- Gemini: https://gemini.google.comTheory
- Theory Ventures: https://theory.ventures
- Oracle: https://www.oracle.com
- Microsoft: https://www.microsoft.com/en-ph/
- Totogi: https://totogi.com
- Long Bets: https://longbets.org
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 13, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/collusion-vs-implicit-collusion-navigating-legal-and-profitable-pricing-strategies/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Leah Tharin brings B2B SaaS to the product-led growth retention light. Advising organizations to bring growth, product, marketing, and sales in line, scaling to move down or upmarket. She works in the operational details and not the hypothetical clouds with her clients.
In this episode, Leah explains the differences between product-led growth (PLG) and sales-led growth, highlighting the benefits of usage-limited freemiums in PLG strategies. She emphasizes the importance of focusing on core value and customer experience when designing freemiums. She advises on pricing strategies, recommending minimal price changes during the early stages and frequent experiments as the company matures.
Why you have to check out today’s podcast:
- Find detailed definitions of key business concepts like product-led growth (PLG) and sales-led growth (SLG) that offer valuable comparisons to help you understand their differences, as well as applications.
- Learn practical and actionable advice on pricing strategies, emphasizing the importance of initial pricing for early-stage companies and the need for frequent pricing experiments as the company grows.
- Deep dive into effective business practices, such as leveraging freemium models and understanding the importance of customer value in pricing strategies.
"If you cannot convince people to use your stuff for free, then I think you should not have any price on your product."
- Leah Tharin
Topics Covered:
01:32 - Why she describe the relationship between pricing and value as stressful
03:09 - Defining a product-led growth
06:47 - Leah expanding the product-led growth definition to include interactive demos and automated marketing tools
08:49 - How companies adopt product-led growth to improve cost efficiency and compete with more agile, cost-effective competitors
11:22 - Sales-led growth defined
14:20 - What does a product-led growth focuses in getting into
20:02 - Understanding a Freemium product offer
24:10 - Why she prefers a Freemium model that is usage-limited
26:46 - An outcome-driven way of looking at the minimum viable product
29:31 - Leah's best pricing advice
Key Takeaways:
"Traditionally we talk about product-led growth in the terms of trials, freemiums, getting something for free forever until you buy it, and so forth. But I also talk about it in the context of getting an interactive demo where you understand what they now do inside of this demo." - Leah Tharin
"...what we try to do in product-led growth is exactly this. It's not so much about how much the customer spends in the initial payment with us or like even the first couple of months, maybe even year. It is about the lifetime value, how fast we can escalate this of course as well because this is also a sign of customer value." - Leah Tharin
"For commoditized markets, product-led growth, if it can be done, it's not always the right thing, but definitely the choice that you have to make. In new verticals with extremely complicated integrations, we tend to be more sales-led for sure." - Leah Tharin
People /Resources Mentioned:
- Netflix: https://www.netflix.com
- Spotify: https://open.spotify.com
- Hubspot: https://www.hubspot.com
- Salesforce: https://www.salesforce.com
Connect with Leah Tharin:
- LinkedIn: https://www.linkedin.com/in/leahtharin/
- Website: https://www.leahtharin.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 6, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/price-segmentation-in-action-why-geography-matters-for-your-wallet/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mac Kremer leads the pricing strategy practice at K1 Investment Management. He is experienced in B2B SaaS investing and value creation work.
In this episode, Mac shares strategies for growing SaaS businesses through price increases, upsells, cross-sells, and increased usage. It discusses the complexities of implementing pricing systems and emphasizes the importance of flexibility and understanding your pricing model. Additionally, it highlights the need to educate sales teams on value-based selling to reduce discounting and improve sales effectiveness.
Why you have to check out today’s podcast:
- Discover valuable strategies for growing SaaS businesses, including ways to expand, manage and track revenue streams effectively.
- Understand the complexities of implementing pricing systems in various-sized companies and find out solutions from simple tools to more sophisticated systems.
- Learn practical tips on communicating value to customers, helping sales teams to sell more effectively reducing the reliance on discounts.
"Sit down with whoever's responsible for pricing, decide to set up a committee and a cadence and just start talking about it more and more."
- Mac Kremer
Topics Covered:
01:35 - How Mac found himself in pricing
02:42 - Describing his role at a private equity firm as both an advisor and consultant
03:38 - Discussing the importance of customer conversations in understanding value propositions
05:47 - Explaining that value can also include benefits beyond profit
07:28 - Similarities and differences between B2B and B2C purchasing decisions
08:49 - Using ROI calculators and the ability of sales reps to contextualize ROI within the business's specific goals
09:56 - How ownership of pricing in a company depends on its stage of development
14:01 - Importance of forecasting and budgeting for pricing activities
16:00 - Understanding the sources of revenue growth highlighting the four ways to grow a customer: Win, Keep, Grow
19:49 - What to focus on when it comes to net revenue retention
21:35 - Variety of pricing systems used and how it depends on the complexity of pricing models used
23:55 - The complexities of implementing and managing pricing systems as companies grow
25:57 - Helping salespeople understand and communicate value
29:06 - Mac's best pricing advice
Key Takeaways:
"Customer conversations are so critical to understanding the value proposition of your solution, and where you kind of see your customer's perceiving value before you even start to talk about price." - Mac Kremer
"The best place to start when you're having customer conversations is, you can go in and you can kind of engineer the true value calculator, the EVC, the economic value to the customer. But I think it's also just understanding their perception of the value that they're receiving. Because I think value comes in a lot of different forms, even outside of just profit." - Mac Kremer
"A lot depends on the complexity of your pricing model when you go to think about what system we should be using?" - Mac Kremer
People/Resources Mentioned:
- Maxio: https://www.maxio.com
- Chargebee: https://www.chargebee.com
- Gainsight: https://www.gainsight.com
- NetSuite: https://www.netsuite.com/portal/home.shtmlSalesforce:https://www.salesforce.com
- Tableau: https://www.tableau.com
Connect with Mac Kremer:
- LinkedIn: https://www.linkedin.com/in/mac-kremer/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 30, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-price-is-never-right/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
With 10+ years in strategic data-marketing, digital, AI and management consulting across sectors like automotive, travel, pharma, and BPO, Fabien Cros has been recognized for his knack to develop and deploy impactful, data-driven solutions. His expertise spans data consulting, AI solutions, UX, marketing analytics, and more.
In this episode, Fabien shares successful case studies, such as Patagonia and Decathlon, demonstrating how companies can transition to more sustainable business models and achieve higher profitability. Also, learn practical advice and strategies that can be directly applied to a company's business operations, helping make informed decisions and drive impact.
Why you have to check out today’s podcast:
- Discover how to incorporate sustainability into your business models and pricing strategies, gaining valuable insights along the way
- Gain in-depth knowledge and practical advice on leveraging sustainability as a competitive advantage, backed by real-world examples and data
- Learn why there is a significant untapped market for sustainability-focused products and services, making it relevant for businesses aiming to capture new customer segments and drive profitability
"Go in depth, over-segment your market because you need to understand this new trend emerging around sustainability. Because it's a major untapped market for a lot of brands and companies."
- Fabien Cros
Topics Covered:
01:52 - How he got into pricing
03:43 - Introducing the concept of integrating pricing strategies with sustainability goals
10:25 - Discussing the challenges and benefits of integrating sustainability into pricing strategies
14:23 - Delving deeper into the concept of sustainability in pricing -- that sustainability is more than just a feature; it's a fundamental shift in business practices
18:30 - Acknowledging challenges integrating sustainability in pricing but also highlighting growing consumer awareness and regulatory pressures around sustainability
22:46 - The potential for sustainability as a competitive advantage in pricing strategies
27:21 - Examples of large companies successfully integrating sustainable practices
30:23 - Fabien's best pricing advice
Key Takeaways:
"What we say with Pricing for the Planet is, move to what we call 21st century concept which is value-based pricing. That way you can create additional revenue and additional profits. That way you can invest into sustainability." - Fabien Cros
"The data is showing us that you have a subset of the population. They're so passionate and they're so convinced that it's crucial that you cannot forget this market and this market segment could actually fuel a lot of the money and a lot of the financial need that is required to move to a more sustainable business model." - Fabien Cros
“We are trying to convey this message that sustainability could be viewed as a feature for the end users, but it's a new way of doing business.” - Fabien Cros
People/Resources Mentioned:
- Accenture: https://www.accenture.com/
- Stephan Liozu: https://impactpricing.com/podcast/582-segmentation-strategies-uncovered-driving-revenue-through-focus-and-value-with-stephan-liozu/
- Schneider Electric: https://www.se.com/ww/en/
- Patagonia: https://www.patagonia.com/home/
- Doc Martens: https://us.rewair.drmartens.com/
- BCG: https://www.bcg.com
- Michelin: https://www.michelinman.com
- Decathlon: https://www.decathlon.com
Connect with Fabien Cros:
- LinkedIn: https://www.linkedin.com/in/fabien-cros-3b66a332/
- Website: https://www.pricingfortheplanet.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 23, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-value-based-selling-marketing-work-together-to-drive-increased-profitability/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dr. Thomas (Tom) Nagle founded the Strategic Pricing Group (now part of Monitor Deloitte) in 1987 soon after publication of the first edition of The Strategy and Tactics of Pricing. For more than three decades, he has advised companies, primarily in B-to-B markets, on how to manage more profitably the five elements of pricing strategy: Value Creation, Value Communication, Price Structure, Pricing Policy, and Competitive Price Setting.
In this episode, Tom shares how value is perceived and measured by customers, emphasizing the distinction between economic value and willingness to pay. He also delves into the complexities of pricing negotiations, highlighting the importance of understanding customer perceptions and effectively communicating the impact of products or services on their business outcomes.
Why you have to check out today’s podcast:
- Understand the intricacies of value-based pricing, distinguishing between economic value and willingness to pay, and providing real-life examples illustrating these concepts effectively
- Delve into these two critical decisions buyers make to help you better understand and influence customer purchasing behaviors
- Find out practical advice on handling price negotiations, emphasizing the importance of "gives and gets" and strategies to avoid undermining your pricing integrity
"Don't ever believe what the customer is telling you upfront about what their value is. They may believe it, but they don't know the impact."
- Tom Nagle
Topics Covered:
01:29 - His early experiences with pricing influenced by his grandmother and how he got into pricing professionally
03:16 - How it is more effective to focus on market response to price changes and gather qualitative insights from clients than just precisely measuring elasticity
08:49 - Important thoughts on why pricing didn't matter much then before its deregulation
11:28 - Explaining the concepts of value and value-based pricing with an example illustrating the point
16:56 - The need to create policies to maintain price integrity and managing negotiations to prevent undermining value capture
23:25 - Discussing the concept of value-based pricing and sharing an insightful example where a service's value was evaluated against the status quo rather than a competitor
26:16 - Tom's best pricing advice
Key Takeaways:
"The goal is not to try to put a line between them that's a weighted average of the high prices and the low prices, and call it a demand curve. The goal is to figure out why we have all this variation and use that variation to create segments that eliminate the trade off between price and volume." - Tom Nagle
"The value isn't in the product. You can study the product from now until kingdom come, and you are never going to understand the value by studying the product. You have to study how the products' benefits impact the customer's income statement." - Tom Nagle
People/Resources Mentioned:
- Financial Analysis for Profit-Driven Pricing: https://sloanreview.mit.edu/article/financial-analysis-for-profitdriven-pricing/
- Walmart: https://www.walmart.com
- DuPont: https://www.dupont.com
- Malcolm Baldrige National Quality Award: http://asq.org/quality-resources/malcolm-baldrige-national-quality-award
Connect with Tom Nagle:
- LinkedIn: https://www.linkedin.com/in/thomas-tom-nagle
- Email: thomasnaglephd@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 16, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/roi-calculators-busting-myths-and-building-trust-in-b2b-sales/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jason Covitz, the Vice President of Commercial Finance at Covetrus, possesses a wide range of expertise including CFO, Business Growth, Value-Based Pricing, Sales Effectiveness, and Product Management, among others.
In this episode, Jason shares competitive pricing strategies, emphasizing the importance of understanding both inherent and relative value when comparing products to competitors. He shares practical methods for gathering competitive pricing intelligence and highlights the need for combining analytical and creative thinking in pricing.
Why you have to check out today’s podcast:
- Gain valuable insights into how to approach value-based pricing, understand competitor comparisons, and leverage features to maximize your product's value
- Discover valuable methods for gathering competitive pricing intelligence and innovative techniques to help you make informed pricing decisions
- Learn to "ruthlessly prioritize" tasks based on their potential value to help you effectively focus your efforts and achieve significant business results
"Keep digging. Get your teams comfortable with learning. Be inquisitive, poke around, turn on the lights, and hopefully you find large piles of money."
- Jason Covitz
Topics Covered:
02:11 - What led Jason into pricing
03:17 - Discussing how analytics at Capital One included evaluating factors like the cost of repossessing a car and its post-repossession value
05:01 - Explaining the difference between a private equity (PE) owned company and a public company
07:32 - Advocating for a detailed feature-level competitor comparison
10:45 - Think about ROI conversation
11:45 - The challenge of determining competitor pricing for value-based pricing
16:16 - Discussing strategies for competitive pricing and understanding relative value
20:50 - Important thoughts on the use of conjoint analysis in B2B versus B2C contexts
22:40 - Talking about the blend of skills required in pricing, noting that it's not about pure numbers
23:44 - Jason's best pricing advice
Key Takeaways:
"Competitive intelligence from pricing --- people are like, well, I'm just going to ask them what the number is. Well, the number by itself doesn't stand alone; you got to bring the whole story to the conversation in that case." - Jason Covitz
People/Resources Mentioned:
- Capital One: https://www.capitalone.com
- First Data: https://www.first-datacorp.com
- Covetrus: https://covetrus.com/
Connect with Jason Covitz:
- LinkedIn: https://www.linkedin.com/in/jcovitz/
- Email: jascovitz@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 8, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/simplifying-segmentation-for-enhanced-profitability/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
With over 25 years of experience in pricing strategy, analytics, and customer relationship management, Adrienne Gordon is passionate about empowering businesses to leverage pricing as a long-term strategic advantage and a path to self-actualization.
In this episode, Adrienne delves into the profound impact of CEO decisions on overall company pricing. She explores the concept of 'value killers' such as the 'Bob Factor', the 'Lester Factor,' and ‘Cheryl factor’ illustrating how individual actions and outdated models can undermine pricing policies. Additionally, she discusses the importance of setting clear pricing goals, understanding price distribution and variance, and leveraging pricing processes to maximize profitability.
Why you have to check out today’s podcast:
- Delve into the crucial role of leadership in effective pricing and value delivery within a company
- Find out common pitfalls and strategies in pricing that will help you understand how internal processes and individual actions can impact a company's pricing power and profitability
- Discover actionable advice for immediate impact enhancing your company's pricing approach and proactive value creation
"If you look at pricing as a process, you will self-actualize as a company."
- Adrienne Gordon
Topics Covered:
00:51 - How she found herself in pricing
02:26 - How her role in product management helped her develop valuable skills in product segmentation and customer insights
03:55 - Differentiating these two companies she manages, Pricing Empowered and Price Space
06:36 - The role of leadership, specifically CEOs, in pricing strategy
09:09 - Explaining the concept of "value killers" using the metaphor of "Bob"
11:40 - The negative impact of allowing CEOs to negotiate prices and discussing the concept of parameters of empowerment
14:29 - Another value killer: The Lester factor
16:55 - What makes ‘'Cheryl factor' a value killer and the extent of profit leaks this causes
20:15 - Three key actions leaders should take to drive pricing in their companies
24:19 - Differentiating between intentional and unintentional price variance
25:14 - Adrienne's best pricing advice
Key Takeaways:
“If the CEO doesn't believe that you can proactively price and influence markets with your pricing, then the company has no faith in it either.” - Adrienne Gordon
"Parameters of empowerment: to me sometimes actually retracting some permission and then testing your value proposition, pushing pricing a little bit so that the organization can see the worth doesn't fall apart when you do that. And releasing that empowerment back, I think, actually, can help companies evolve." - Adrienne Gordon
"I often make recommendations, do not put on your parameters of empowerment 5, 10, and 15. Put on 4.72. Somebody's going to have to do the hard work to figure out what 4.72% discount is. And that's a good thing." - Adrienne Gordon
People/Resources Mentioned:
- McKinsey: https://www.mckinsey.com
Connect with Adrienne Gordon:
- LinkedIn: https://www.linkedin.com/in/adrienne-gordon-0a93129/
- Website: https://www.pricespace.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 2, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/reduce-the-risk-of-raising-prices/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Tim Smith helps executives address critical questions in pricing, marketing, sales, and corporate strategy in the face of high uncertainty by using proven best practices informed by solid academic research.
In this episode, Tim delves into the Pricing Spineometer, a comprehensive tool designed to assess a company's pricing capabilities. By examining financial performance and organizational structure, one can provide valuable insights into the gap between a company's current pricing practices and optimal strategies. He also touches on the crucial role pricing plays in business success and the importance of CEO involvement in driving pricing excellence.
Why you have to check out today’s podcast:
- Discover this pricing tool called Pricing Spineometer for assessing a company's pricing capabilities and learn how it works, its significance, and how it can benefit businesses
- Gain insights into the world of pricing strategies discover surprising findings about pricing practices in various industries and how they impact business performance
- Explore the critical role of CEOs in driving pricing excellence within organizations and understand why pricing decisions often require the direct involvement and prioritization of top leadership, and how this impacts business outcomes
"Take the time to apply the expertise necessary to your pricing questions. Think about it, and then listen to that expertise."
- Tim Smith
Topics Covered:
01:36 - Sharing an enriching experience teaching and consulting
02:45 - How he found himself in pricing
04:08 - What made him create Pricing Spineometer, what is it all about, clarity on it measuring a gap versus a scorecard
07:31 - The process of using the Pricing Spineometer
11:40 - How the initial financial analysis sets the foundation for understanding a company's pricing needs and capabilities
14:29 - Understanding that creating a Pricing Spineometer for a company involves significant work and expertise
16:26 - AI's impact on pricing and the companies' various reactions on their pricing capabilities assessment with pricing spineometer
19:16 - Valued for the expertise and insight not on time spent
20:08 - Surprises coming up for different companies pricing sophistication
22:19 - Does the CEO takes care of the development of pricing expertise and how does a CRO differ from a VP of Pricing
24:26 - Tim's best pricing advice
Key Takeaways:
"If you changed the way you thought about pricing, there'd be a huge bottom line impact to your company." - Tim Smith
"You're charging for the intellect that goes into the work, not the actual amount of time it takes to do the work." - Tim Smith
"There are ways to get around tools, there are ways to use the tools, but you’ve got to understand what the goal is." - Tim Smith
People/Resources Mentioned:
- World Class Pricing: The Journey by Paul Hunt: http://www.pricingsolutions.com/world-class-pricing-the-journey/
- TI: https://www.ti.com
- Walmart:https://www.walmart.com
- Coca Cola: https://www.coca-cola.com/us/en
- Pepsi: https://www.pepsi.com/
- Nvidia: https://www.nvidia.com/en-us/
- Kraft Heinz: https://www.kraftheinzcompany.com/
Connect with Tim Smith:
- LinkedIn: https://www.linkedin.com/in/drwiglaf/
- Website: https://wiglafpricing.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 25, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-value-of-a-feature-how-to-create-value-tables/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Patrick Meegan is a Managing Director at Investor Group Services. Experienced in technology, industrials, consumer products, retail and e-commerce, subscription programs, pricing, and product strategy.
In this episode, he delves into the complexities of pricing strategies, emphasizing the importance of aligning prices with the perceived value and understanding market segments. She also explores the nuances between B2C and B2B pricing, highlighting the transparency in B2C and the significance of marketing and packaging in consumer products. Additionally, she provides insights on implementing price changes effectively in different organizational sizes and navigating the challenges of setting prices through distribution channels.
Why you have to check out today’s podcast:
- Understand buyer drivers in order to make strategic decisions in pricing and packaging
- Learn practical advice on implementing price changes, particularly the challenges and strategies for ensuring successful pricing execution
- Gain valuable insights into the differences between B2C and B2B pricing, including unique challenges in B2C and the role of marketing in consumer products
"Spend time pressure testing the ideas."
- Patrick Meegan
Topics Covered:
01:51 - The best way to teaching case studies and the how to go about each case
02:49 - How he ended up in pricing despite lack of pricing background
03:59 - Value-based pricing and understanding buyer behavior
05:03 - The process of generating pricing insights
06:39 - Application of a framework to generate pricing insights
08:57 - Challenges and strategies for executing pricing changes, particularly in larger organizations
11:17 - Overcoming fear of raising prices.
13:08 - Strategies for reducing fear and uncertainty when implementing price increases
15:42 - The appropriate role of salespeople in pricing decisions
17:32 - The importance of setting and managing price floors and discounting policies for salespeople
21:34 - Maintaining pricing integrity and avoiding discounts
22:46 - The differences between B2C and B2B pricing strategies and how crucial is setting the end user price first when selling through distribution or channels
26:46 - Pat's best pricing advice
Key Takeaways:
"If we can't understand from the buyer's side what's driving their purchase, then it's hard for us to understand how to sell to them, how to negotiate, where to hang the value, how to package and how to structure the pricing model." - Patrick Meegan
"I cringe so much when I see people going out with a price of whatever it is with a discount right along with it because whatever value established you just eroded by saying it wasn't worth that." - Patrick Meegan
"Your portfolio also plays an important role in how you can influence pricing." - Patrick Meegan
People/Resources Mentioned:
- Kimberly Clark: https://www.kimberly-clark.com/en-us
- Kleenex: https://www.kleenex.com/en-us/
- Huggies: https://www.huggies.com/en-us/
Connect with Patrick Meegan:
- Website: maplestreet.com
- LinkedIn: https://www.linkedin.com/in/patrickmeegan/
- Email: patrick.meegan@igsinsights.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 18, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/b2b-market-research-is-overrated/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business.
In this episode, Steven explains how AI can significantly enhance software customization and pricing, enabling more precise value delivery for each customer. He emphasizes that while AI introduces new capabilities, it does not fundamentally change the core principles of pricing.
Why you have to check out today’s podcast:
- Dive deep into the comparison between AI and the transformative impact of SaaS, providing valuable insights into the future of software pricing and delivery
- Understand value models and how AI can optimize pricing strategies
- Explore how AI can enable highly customized software configurations and pricing, making it easier to deliver and capture value tailored to individual customers
"Before they invest a lot of time and effort in developing or pricing their own AI, find out what their customers are already doing and how they're thinking about the problems."
- Steven Forth
Topics Covered:
00:47 - Skepticism as well as optimism regarding AI and addressing the hype surrounding AI
04:15 - Exploring how AI might impact software pricing compared to the changes brought about by cloud-based SaaS.
07:05 - The way AI can optimize software configurations and pricing based on individual value drivers for each customer
10:44 - Discussing how SaaS fundamentally changed software pricing compared to AI
14:11 - How AI, while it enhances capabilities and user experiences, does not fundamentally change the underlying principles of pricing
16:31 - What is a value model?
18:15 - Pricing being tied more closely to value with the rise of AI
23:27 - Steven's best pricing advice
Key Takeaways:
"The underlying ways that we think about pricing have not changed because of generative AI and will not change, but some of them we’ll be able to execute on much, much more effectively." - Steven Forth
"I think of pricing not as being something that is data-driven, but something that is model-driven." - Steven Forth
"AI is changing how we build, deliver, and experience the functionality that software and data can bring. But as it does that, it also opens new ways for us to think about the pricing of the applications and the data." - Steven Forth
People/Resources Mentioned:
- Pros: https://pros.com
- Microsoft: https://www.microsoft.com/en-ph/Don Norman: https://www.nngroup.com/people/don-norman/
- Jacob Nielsen: https://www.nngroup.com/people/don-norman/
- Totogi: https://www.totogi.com
- McKinsey: https://www.mckinsey.com
- Tom Nagle: https://www.linkedin.com/in/thomas-tom-nagle-2bb2288/
- Zilliant: https://zilliant.com
- Pricefx: https://www.pricefx.com
- Vendavo: https://www.vendavo.com
- Tomasz Tunguz: https://www.linkedin.com/in/tomasztunguz/
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 11, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-for-buyer-personas/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
As a consultant, coach, and 6-time executive, Amanda Northcutt has launched, grown, and scaled online businesses with fantastic results on both the individual and organizational level, while creating extraordinary, frictionless, and successful journeys for their customers.
In this episode, Amanda delves on the importance of focusing on customer retention and expansion to maximize recurring revenue. And leveraging foundational desires and social proof to enhance one's marketing efforts. She also highlights the value of dynamic and continuous pricing strategies and the need for personalized connections in sales and the impact of showing proven value to customers.
Why you have to check out today’s podcast:
- Learn to prioritize expansion, not just acquiring and retaining customers, to maximize lifetime value
- Discover why it's crucial to avoid static pricing and the importance of regularly testing and adjusting your pricing
- Gain a deep understanding of your customers' core desires and master the art of leveraging social proof to create highly effective marketing strategies
"Always be testing your pricing. Your pricing should not be static. That is such a rookie mistake to think that you've nailed it the first time, or at any time really."
- Amanda Northcutt
Topics Covered:
01:39 - An accidental entry into recurring revenue
03:20 - Talking about the time of Salesforce' rise in the SaaS industry
04:46 - Sharing her journey into the subscription-based business model
05:57 - The challenges and importance of marketing and delivering value in subscription-based businesses
08:25 - An added challenge for SaaS businesses of needing a product that continuously delivers value to retain customers
10:46 - The need to create expansion opportunities with tailored solutions and the need to leverage social proof to strengthen the value proposition to potential and existing customers
13:31 - Understanding and leveraging consumer psychology and desires to drive value perception and retention in both B2B and B2C contexts.
15:46 - Expanding on customer's foundational desires as effective marketing strategies
17:21 - Helping customers achieve their goals and meet their needs rather than simply trying to make a sale.
20:06 - Describing her current work and her pricing approach for her clients' customers.
25:52 - Amanda's best pricing advice
26:57 - What it means to be always testing your pricing
Key Takeaways:
"...the whole deal with recurring revenue: If your marketing sucks, one, people aren't going to sign up. Two, if you're not delivering value over and over and over and over and over again, people are going to churn." - Amanda Northcutt
"If you truly actually care about someone and you want to help match them with a solution that is actually going to help them not only reach their foundational desires, but the real business needs that they have, that's where the most sales are going to be made." - Amanda Northcutt
"Desperation is the enemy of all sales, ever." - Amanda Northcutt
"Another element of closing the deal in an automated sales funnel is that guarantee is very, very, very important. It's right up there with social proof." - Amanda Northcutt
People/Resources Mentioned:
- Texas A&M University: https://www.tamu.edu/
- TexAgs.com: https://texags.com
- Marc Benioff: https://en.wikipedia.org/wiki/Marc_Benioff
- Salesforce: https://www.salesforce.com/ap/
- Alan Weiss: https://alanweiss.com/about-alan-weiss/
- Convertkit: https://convertkit.com
- Active Campaign: https://www.activecampaign.com/
- Amazon Prime Video: https://www.primevideo.com/
Connect with Amanda Northcutt:
- LinkedIn: https://www.linkedin.com/in/northcuttamanda/
- Email: amanda@welevelupcreators.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 4, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/discover-our-custom-pricing-gpt/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Sundar Ramanathan is a Banking Product and Pricing Executive with experience in exceeding/meeting growth, capital, liquidity, and profitability objectives through product and pricing levers.
In this episode, Sundar emphasizes the importance of moving beyond product commoditization, instead, focusing on creating value through customer experiences, and pricing as the outcome of value creation.
Why you have to check out today’s podcast:
- Discover the fascinating concept of the indifference curve in the context of pricing banking products
- Learn the art of developing a customer-centric approach to pricing banking products, taking into account essential factors for success
- Find out how you can implement value pricing strategies, even with commoditized banking products
"On the retail banking side, we hear commoditization a lot. But I think there is an opportunity to go beyond that. I think products disappear and experiences emerge, and experience is what creates value. And value can be priced."
- Sundar Ramanathan
Topics Covered:
01:36 - How he found himself in pricing
02:47 - Talking about examples of banking products
04:39 - Is bank's pricing based on value or cost
09:15 - The importance of balancing cost and value and highlighting the indifference curve in pricing
11:55 - Determining the area of indifference in banking pricing
16:06 - How to let borrowers decide in your favor over your competitors
19:37 - Where you create value pricing in banking products
22:06 - Sundar's best pricing advice
Key Takeaways:
"The product structure and pricing might be commoditized, but where you create the value and enhance your pricing margin is the experience." - Sundar Ramanathan
"You will never know the right pricing unless you are bold enough to make those decisions to test that elasticity and have a plan B." - Sundar Ramanathan
"You can only create value by removing the friction as much as possible compared to competition.” - Sundar Ramanathan
"You can never win by pricing." - Sundar Ramanathan
Connect with Sundar Ramanathan:
- LinkedIn: https://www.linkedin.com/in/sundar
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 28, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/show-me-the-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Vivek Anand leads a team of data scientists, statisticians and operations research professionals that apply Data Science and Operations Research techniques to build production ready solutions for problems related to Price Optimization, Inventory Management, and Fulfillment Optimization for a Fortune Fashion retailer.
In this episode, Vivek delves into the strength of combining science and machine learning to make informed pricing decisions. He emphasizes the importance of starting small and continuously enhancing strategies through data-driven approaches. It also explores the differences in B2C and B2B pricing, the impact of AI on supporting salespeople, and the challenges of misaligned incentives in achieving business success.
Why you have to check out today’s podcast:
- Understand the need for compensation structures and incentives to align with business objectives that support desired outcomes
- Discover how AI is impacting the way salespeople handle pricing and negotiation
- Learn how to leverage both science and machine learning to make more informed pricing decisions
"If you're new to the journey, start small. You don't have to go and build a transformer network on day one. Even a simple EDA, Exploratory Data Analysis, can give you a ton of insights than just a guesswork."
- Vivek Anand
Topics Covered:
01:19 - What paved his way into pricing
03:26 - How credit risk and interest risk influence pricing derivatives
04:37 - Thoughts on quantifying risks
05:36 - Data science in relation to AI advancement
07:39 - AI capabilities in capturing contextual and temporal information and other pricing techniques using AI
11:30 - Talking about AI and extrapolation
12:47 - B2C pricing versus B2B pricing and the significant difference in data availability between the two
18:38 - How AI can be utilized in the B2B world to assist salespeople in pricing and negotiation
23:57 - Vivek's one best pricing advice
Key Takeaways:
"B2C is mostly, pricing is a lever to generate demand. Whereas in B2B, it's more of a lever to gauge the willingness to pay from the customer's standpoint.” - Vivek Anand
"I think data science is a big tent, and AI is a part of it." - Vivek Anand
“The way I think about AI is like, instead of making it heuristics, it learns from the data or it just comes up with a mechanism that just translates input to the output, more systemic, faster learning and can be deployed at scale.” - Vivek Anand
Connect with Vivek Anand:
- LinkedIn: https://www.linkedin.com/in/va2260/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 21, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-value-perception-gap/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business.
In this episode, Steven delves into the dynamic world of pricing strategies as revealed through the lens of the Professional Pricing Society event. He talks about the latest developments, innovative practices, and thought-provoking discussions emerging from these events of pricing professionals. From uncovering cutting-edge pricing technologies to dissecting evolving pricing trends that offer valuable insights to help you in navigating the ever-changing landscape of pricing strategies especially where AI is concerned.
Why you have to check out today’s podcast:
- Discover what's in store for this year's Professional Pricing Society conferences
- Find out the significant and engaging topics discussed in the PPS event
- Look forward to Steven's valuable insights and key points on pricing trends and innovations, particularly in relation to AI
"The other problem or challenge, I think, that one can have with AI-based approaches to pricing is the sort of black box nature. And generative AI, gives something of a path forward for that."
- Steven Forth
Topics Covered:
01:46 - Steven highlighting how the Professional Pricing Society [PPS] listens to Impact Pricing podcast
03:29 - Professional Pricing Society's calendar of events this year
04:39 - What's coming up for this year's event: Return of the book store
06:25 - Featured and notable books available at the event
09:54 - Other interesting things coming up for PPS' event
11:28 - Steven's important thoughts on pricing sustainability and some examples on point
15:41 - What differentiates a value model from a sustainability model as far as Ibbaka's concerned
17:26 - What he thinks of these big pricing vendors approach to AI
18:46 - Talking about pricing industry frustration and the black box nature of AI and the shift to generative AI
21:19 - Discussing the application of generative AI in a dynamically configuring software and its implications on the pricing strategies
24:56 - Sharing about the scale and complexity of traditional value model as well as the potential of generative AI to quickly adapt to different pricing and value configurations
28:39 - Watch out for an upcoming webinar on May 23rd
29:08 - What he thinks of people's reception to his presentation at the Professional Pricing Society's conference
Key Takeaways:
"Feel good metrics or social responsibility, none of those things are really going to get people to buy and pay for sustainable solutions. It has to be tied to value, and you have to be able to show that your green solution provides more value than the competing solutions." - Steven Forth
"I think the secret here, at least from a pricing and modeling approach, is to find those variables that get used across the different models. And by having the same variable used in different models you can pull sustainability together with value together with pricing." - Steven Forth
People/Resources Mentioned:
- Arnab Sinha Impact Pricing Episode 564: https://impactpricing.com/podcast/564-exploring-game-changing-pricing-dynamics-for-different-industries-with-arnab-sinha/
- Game Changer: How Strategic Pricing Shapes Businesses, Markets, and Society by Jean-Manuel Izaret and Arnab Sinha: https://www.amazon.com/Game-Changer-Strategic-Pricing-Business/dp/1394190581
- Stephan Liozu Impact Pricing Episode 582: https://impactpricing.com/?s=stephan+liozu
- Nick Nalepa: https://www.linkedin.com/in/nick-nalepa/
- Stop Racing In A Blindfold!: Big Data + Pricing Science Drive Bigger Profits by Jim Vaughn: https://www.amazon.com/Stop-Racing-Blindfold-Pricing-Science/dp/099068380X
- Michelin: https://www.michelinman.com
- Hydropoint: https://www.hydropoint.com
- Vendavo: https://www.vendavo.com
- Pros: https://pros.com
- PriceFX: https://www.pricefx.com
- Totogi: https://www.totogi.com/
- Resilience: https://www.bcg.com/publications/2023/resilient-pricing-for-uncertain-world
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 14, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/using-value-to-break-down-silos/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Rishi Bhatia is an experienced analytics consultant, data expert and market research professional with domain expertise in retail, technology, telecom, apparel, manufacturing, and insurance domain.
In this episode, Rishi shares about Walmart's lower pricing strategy. He emphasizes the importance of prioritizing the customer when determining pricing strategies. He also highlights the significance of leveraging data and analytics to inform pricing decisions. And also the importance of adopting AI-driven models to streamline operations and remain competitive in the market.
Why you have to check out today’s podcast:
- Learn how Walmart maximizes profitability while maintaining its everyday low prices
- Discover how AI revolutionizes the retail industry by enabling retailers to make informed pricing decisions, rather than just providing pricing insights
- Explore the impact of retail pricing on customer loyalty and retention
"Put your customer first. Rather than going for the traditional route, learn from the data as much as you can. And then, improve your models constantly based on how can you get the prices right."
- Rishi Bhatia
Topics Covered:
01:01 - How he found himself in pricing
02:46 - Why everyday low price policy for Walmart and how do they maximize revenue with this strategy
03:46 - Pricing and how it affects loyalty and retention
05:18 - What makes Walmart's margins high other than lower prices
06:48 - How AI in pricing optimization has evolved from basic insights generation to sophisticated model-driven recommendations
08:41 - Is AI a blackbox and how the process works in achieving pricing decision
11:31 - Walmart's primary focus regarding pricing decisions and how AI ensures timely transitions between product cycles and maintaining profitability
13:47 - How algorithms and recommendations ensures consistency and optimization across the retail chain
14:44 - Discussion around Wendy's dynamic pricing
19:49 - Rishi's response to Mark's advice for retailers and also talking about Walmart Plus
21:15 - Rishi's best pricing advice
23:12 - How do you measure value in retail products
Key Takeaways:
"Value pricing, what does your customer want, at what price your customer will be more loyal to you and what will they... because pricing is one component that everyone wants low price." - Rishi Bhatia
"When you're putting the product, rather than going for the traditional route, learn from the data as much as you can and improve your models constantly based on that, how can you get the prices right." - Rishi Bhatia
"If you're able to improve on that and the customer, your overall complaints are also going down. And that is one value you can measure from that perspective as well. It's not always in the monetary term, it's always on the customer satisfaction side as well." - Rishi Bhatia
People/ Resources Mentioned:
- Walmart: https://www.walmart.com
- Uber: https://www.uber.com
Connect with Rishi Bhatia:
- LinkedIn: https://www.linkedin.com/in/rishi-bhatia-5480577/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 7, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/to-fee-or-not-to-fee-that-is-the-question/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Stephan Liozu has studied, researched, and practiced value-based pricing for over 15 years now. That includes training, speaking, consulting, managing pilot projects, and coaching large scale pricing transformations.
In this episode, Stephan highlighted the utmost importance of understanding the value delivered to customers before setting prices, emphasizing a value-first approach to pricing strategies.
Why you have to check out today’s podcast:
- Learn the significance of focusing on a specific market segment to avoid distractions, streamline operations and increase chances of success
- Find out why you don't need to excessively customize your products
- Discover why prioritizing value over price can develop to more effective pricing strategies and maximize profitability
"Do the value work first and then worry about pricing. So, value-based pricing is 90% value, 10% price. So, if you want to do that very well, value first, then price."
- Stephan Liozu
Topics Covered:
02:25 - How Stephan started in pricing
04:13 - Customer segmentation as it relates to value pricing
05:25 - Effective ways of maximizing segmentation
07:17 - Defining customer segmentation and how the SaaS scenario Mark described relate to that
10:16 - Integrating value pricing into customer segmentation
13:03 - What value means to the price buyer
14:11 - How is market segmentation different from customer segmentation?
16:52 - Discussing about product segmentation and taking software for an example
21:28 - The challenge of operationalizing customer segmentation
24:57 - Why focus on one market segment
26:41 - The need to not excessively customize your product
27:42 - Stephan's best pricing advice
Key Takeaways:
"Pick one market, focus on it, find your ICP, and then get a few logos; see what happens." - Stephan Liozu
"Do the value work first and then worry about pricing." - Stephan Liozu
"If you want to do that [value-based pricing] very well, value first, then price." - Stephan Liozu
People/Resources Mentioned:
- Owens Corning: https://investor.owenscorning.com/
- Thales: https://www.thalesgroup.com/en
Connect with Stephan Liozu:
- LinkedIn: https://www.linkedin.com/in/stephanliozu/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 29, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/your-inward-focus-causes-horrible-decisions/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mike Bosworth is a Co-Founder of WeConcile considered as the world's first Relationship Rescue and Restoration application.
In this episode, Mike shares effective pricing strategies and sales techniques to hold prices.
Why you have to check out today’s podcast:
- Learn about the concept of "buying vision" and help your customers recognize the value of your product or service
- Learn how to stand firm against pricing pressure and maintain your desired price
- Discover how to effectively use "polite No's" to firmly establish pricing boundaries
"Understand the value, i.e. how your buyer would use a particular piece of your product to solve their problem. And if you have that knowledge, it's really easy to defend the value of your price."
- Mike Bosworth
Topics Covered:
02:13 - Mike's pricing approach
03:16 - Understanding why salespeople are losing the conversation when it comes to price
06:40 - What is a 'buying vision' and how helpful it is for buyers
07:26 - The need for salespeople to know well their customer's business
10:20 - How 'premature elaboration' gets you at a disadvantage
13:58 - Explaining 'cost justify' and 'price justify' from the buyers point of view
20:49 - The importance of patience in negotiation and use of "polite No's" to stand your ground on pricing
24:36 - Book resource of major negotiation stories you can check out
25:42 - Mike’s pricing advice
Key Takeaways:
"The only salespeople who can go out and negotiate their own prices are those ahead of quota." - Mike Bosworth
"I say to the managers, if your salesperson is under quotas, you have to go out there and provide the backbone and coach the call ahead of time.” - Mike Bosworth
“We want to teach them how to survive that call, but on their own, they're not going to have the ability to do it." - Mike Bosworth
People/Resources Mentioned:
- Xerox: https://www.xerox.com/en-us
- Sales Force: https://www.salesforce.com
- David Crabtree: https://www.barnesandnoble.com/w/hold-out-david-n-crabtree/1119321227
Connect with Mike Bosworth:
- Linkedin:https://www.linkedin.com/in/mikebosworth/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 22, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/fear-stymies-your-growth/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Joe Woodard's vision is to "transform small businesses through small business advisors." And in the service of that vision he and his team educate, coach, provide resources and build communities for small business advisors, with the overarching goal of empowering them to play a powerful, high-impact advisory role with their clients.
In this episode Joe shares strategies for Infusing feelings and solutions into your pricing models that drive people's buying decisions.
Why you have to check out today’s podcast:
- Find out effective strategies for your sales approach
- Discover effective hiring strategies to find the perfect team and talent that align with your needs
- Understand two foundational pillars of value to be effective in selling your product or service
"Infuse everything we've talked about [sales approach] with feelings and solutions into something the client can consume, easily understand, comprehend, and buy easily."
- Joe Woodard
Topics Covered:
02:51 - From a Quickbooks advisor to hiring and teaching coaches how to coach businesses
05:40 - How this great quote from John Maxwell became a huge inspiration for his upcoming conference
07:28 - Understanding the two foundational pillars of value
09:31 - Methodologies used to maximize product's value proposition
12:06 - Gaining a competitive by catering to both emotional and solution-oriented needs
13:48 - Incorporating emotional intelligence into your sales approach
18:44 - How mimicking good behaviors is effective in selling
19:33 - Understanding the DISC method for hiring people
24:26 - Delegating outcomes, holding individuals accountable using methodologies like OKRs (Objectives and Key Results)
25:58 - Infusing pricing strategies with a combination of emotional resonance
28:47 - Interplay between emotions and problem-solving in both B2B and B2C contexts
30:06 - Joe's best pricing advice
31:51 - What this conference, 'Boldly Go!' is about
Key Takeaways:
"If you're waiting for all risk to go away, you're waiting for all fear to go away, you'll never act. And if you're waiting for perfection, you'll never act. So don't wait on those things. Enter the danger, proceed afraid, fail forward, and then read a lot. That's how I did it." - Joe Woodard
"People will only exchange their hard earned dollars for one of two things, how you make me feel, or how you solve my problem." - Joe Woodard
"It's not about price, it's about nature." - Joe Woodard
People/Resources Mentioned:
- John Maxwell: https://www.maxwellleadership.com
- Michio Kaku: https://en.wikipedia.org/wiki/Michio_Kaku
- Neil deGrasse Tyson: https://neildegrassetyson.com
- Malcolm Gladwell: https://www.gladwellbooks.com/
- Outliers: https://www.amazon.com/Outliers-Story-Success-Malcolm-Gladwell/dp/0316017930
- Positive Intelligence: https://www.amazon.com/s?k=positive+intelligence&language
- Measure What Matters: How Google, Bono, and the Gates Foundation Rock the World with OKRs by John Doerr :https://www.amazon.com/Measure-What-Matters-Google-Foundation/dp/0525536221
- Axe: https://www.axe.com/us/en/home.html
- Red Bull: https://www.redbull.com/ph-en/
Connect with Joe Woodard:
- Website: https://www.woodard.com/
- LinkedIn: https://www.linkedin.com/in/quickbooksadvisor/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on February 15, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/stopping-one-of-your-biggest-revenue-leaks-discounts/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steve Laborda is a CEO of Valuebizbooster, Consultant, Coach, Author and Speaker. He is a practitioner in B2B sales and marketing, focusing on improving profitability, how to capture value, and developing the competencies of the commercial people through customer orientation and commercial excellence.
In this episode, Steve delves into the intricate blend of art and science involved in the sales process. He emphasizes the importance of incorporating intangibles alongside hard facts, highlighting that both are essential for success and reaching a deal. Furthermore, he underscores the collaborative efforts of individuals within the company, working cohesively as a team to uphold a value-based approach throughout the entire sales process.
Why you have to check out today’s podcast:
- Find out the three essential components to value selling in which without each one no decision is reached
- Discover how value-based selling works in the whole sales process within the company
- Uncover the effective use of the ROI calculator as a value driver
"Don't forget to work with sales when you do your pricing."
- Steve Laborda
Topics Covered:
01:00 - How he got into pricing
01:30 - The many roles he played
02:41 - Pointing out the 'art' in value, pricing, and selling
04:16 - The intangible benefit other than the emotional, and cognitive aspect of value selling
06:24 - How was his experience different from any other salesperson who's good at building relationships
9:47 - Examples illustrating the three components of the sales process of relationship building, the science part, and the intangibles
11:38 Defining cross-functional value selling
15:04 - Why companies often fail at value-based pricing
17:55 - Calling it a value calculator and not the ROI calculator
20:10 - Why a collaborative way of using the value calculator instead of leaving it to the customer alone
23:36 - Reasons customers likely buy from you
25:35 - Pricing a highly volatile product in the chemical industry
29:23 - Steve's best pricing advice
Key Takeaways:
"Yes, you need to do value quantifications, but you need to be able also to be emotional and to read body language and to read the skills that people have in front of you." - Steve Laborda
"You need to have sales, marketing, pricing, the technical people, if it's a technical context, to have all those people together to develop that value-based approach so that everybody is behind it..." - Steve Laborda
"The value calculator is there for me to give confidence to the salesperson about the price that you can defend to the customer." - Steve Laborda
Connect with Steve Laborda:
- LinkedIn:https://www.linkedin.com/in/stevelaborda/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 8, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/proven-value-can-be-a-game-changer/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Clubs from the Impact Pricing card deck.
Ban the word markup. First, can we all agree that cost-plus pricing is not optimal? We really want to do value-based pricing, charge what a customer is willing to pay. Got it, so we're all in agreement.
Now, let's talk about the word markup. Markup is defined as, tell me what my costs are, how much do I need to mark that up in order to get the margins that I want?
So a markup is by definition cost-plus. Well, it's cost-times, but it's cost-plus. So when we use the word markup, as a company, we're saying we use cost-plus pricing. Now, it is okay, let's say you're running a distribution organization. You're running a grocery store. You've got hundreds of thousands of products to price.
You can't do specific value-based pricing on each one of those products. And so, you have to do something. But don't do just cost-plus. When you say we use a 50 point markup or a 20 point markup, we're implying that goes across the board. What we should be saying is, how much margin do we think we can get from this product category?
Because margin starts at, what's the price? And then, how much did we have to pay to acquire the product that we sold? So margin is a great term to use when we're thinking about value-based pricing. Markup almost forces us to use cost-plus pricing.
So my advice, stop using that word. Don't let anybody else use that word. Switch your mental thought process to margin, not markup.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Geraldine Carter helps single-owner CPAs go down to 40 hours without giving up revenue.
In this episode, Geraldine reveals effective strategies for tailoring your accounting service business to suit your lifestyle, enabling you to increase revenue without feeling overwhelmed by excessive work.
Why you have to check out today’s podcast:
- Discover how accountants can increase their earnings while reducing their workload
- Learn to craft your message to highlight the value you offer, rather than focusing solely on the cost of your services
- Uncover the transformation within the services you offer
"Your clients have an expectation to pay and if your prices are too low, they might not buy from you."
- Geraldine Carter
Topics Covered:
01:56 - Working less but earning more
03:41 - Flexibility, autonomy and working less hours
05:38 - Mindset shift to less hours work
08:48 - Pricing strategies so accountants work less and increase income
11:10 - How message is structured to a CPA's client in terms of raising his price
14:44 - The idea of selling services but delivering transformations
16:42 - Understanding the services accountants perform and how they earn recurring income
17:20 - What transformation does accountants deliver to companies
22:36 - The beauty of having people see the value in your own business
Key Takeaways:
“The revenue that you create in your business has nothing to do with the time that you put in. I mean, you have to grind out the beginning to get it all set up and going. But you can get to the place where you do not have to work 40 or 25 or 15 hours a week. You just have to stay at it until you figure out how to get your hours down.” - Geraldine Carter
“Thinking that revenue comes from work for clients is like thinking that time comes from your watch, it's not how that works.” - Geraldine Carter
“Your buyer decides what price they want to pay. So, we do tiered pricing, we offer it to the clients.” - Geraldine Carter
“Most accountants are selling services, but they're creating and delivering transformations.” - Geraldine Carter
"For business owners listening, do not underestimate the power of pricing wisely." - Geraldine Carter
Connect with Geraldine Carter:
- Website: https://geraldinecarter.com/
- LinkedIn: https://www.linkedin.com/in/geraldine-carter/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 1, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/to-discount-or-not-to-discount/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Diamonds from the Impact Pricing card deck.
Customer perceptions always matter. And what's fascinating is every time we touch a customer, we touch a buyer, they form perceptions of our company. They could be positive perceptions. They could be negative perceptions.
And when I say every time, it's not only salespeople making sales calls. It's when they read our marketing messages. It's when they receive our invoices. It's when they call our customer support or customer service line.
Every single touch point we have with a customer either creates value in their mind, or it destroys value in their mind. The question becomes, which are we going to do?
My recommendation is obviously to create more value with every customer touch point. But how do we do that?
We do that by creating a culture of value Inside our company. A customer centric perspective that says, how is it that this decision, how is it that this action, impacts our customers? And can I do it in a way that impacts our customers in a more positive manner instead of just thinking about how do I get them off the phone? Or how do I take care of them quickly so that they go away and stop bothering me while I do my day job?
So value, a culture of value, is all about doing what's best for our customers and making sure every customer touchpoint increases value, not decreases it.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Robert Ribciuc is the Managing Partner at EBITDA Catalyst. He helped establish, grew, and managed a successful advisory/consulting firm focusing on pricing strategy and analytics, go-to-market optimization, and revenue management for middle-market corporate and private equity portfolio (PE) clients in diverse industry verticals.
In this episode, Robert shares the key to succeeding as a pricing practitioner: nurturing curiosity. By continually seeking new experiences and knowledge, you'll not only advance in your current role but also pave the way for future promotions, ultimately leading to a successful career as a consultant.
Why you have to check out today’s podcast:
- Explore effective strategies for boosting personal and professional development as a pricing professional
- Discover the endless possibilities that come with nurturing your curiosity in the field of pricing
- Find out significant insights about specialization at the same time taking a broad approach in the pricing profession
"Without curiosity, you wouldn't have tried and you wouldn't know how much room for improvement to have."
- Robert Ribciuc
Topics Covered:
01:51 - The breadth of the pricing field extending beyond one's job
03:57 - Specializing in a particular industry versus embracing a multifaceted approach to pricing
08:37 - The importance of constantly learning and adapting in pricing
12:02 - How pricing professionals can be better at what they do
14:40 - How curiosity gets your job done easily and gets you promoted
20:46 - The challenge of teaching for students in university versus teaching for companies
26:08 - Summarizing what the whole topic is about
28:18 - Robert's motivational message
Key Takeaways:
"Go read a book about a different industry, something that's not pricing. Also, get out of your chair and go walk to our product people, go walk to our marketing people and make some friends. Get them to tell you what their job is like and what they're thinking about." - Robert Ribciuc
"Curiosity is kind of the opposite of, ‘I can do it easy.’" - Robert Ribciuc
"In many companies the curiosity gets subdued by, ‘Oh, I find that if I just do this repeated cycle my boss is happy enough,’ right? And that can be an illusion." - Robert Ribciuc
People/ Resources Mentioned:
- Ronald Baker: https://impactpricing.com/podcast/497-classic-trash-the-timesheet-exploring-opportunities-in-subscription-businesses-with-ronald-j-baker/
- Susan David: https://www.susandavid.com
- Vendavo: https://www.vendavo.com
- Pros: https://pros.com
- Zoom: https://zoom.us
- Honeywell: https://www.honeywell.com/us/en
Connect with Robert Ribciuc:
- LinkedIn: https://www.linkedin.com/in/ribciuc/
- Email: robert@ebitdacatalyst.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 25, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/who-should-own-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Hearts from the Impact Pricing card deck.
Business acumen is a skill that salespeople really need, and product people really should have, to say, "Why is it that a customer would want to buy our product?" In B2B, value is measured in incremental profit. Your customer isn't going to buy anything from you, assuming it's a business customer, unless you are making them more money.
Here's the question, how are you making them more money? Somehow, when you can communicate that, when your sales team can communicate that, you have a much better chance at winning the business. And by the way, when you understand it, you have a much better chance at delivering great marketing messages, and building the right products.
We really need the skill of business acumen so we can say what is the business of our customers and how is it that we make them more money, because that is where the value is.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business. In this episode Steven shares the shifting landscape for pricing professionals, emphasizing the rising importance of pricing strategists over analysts in leveraging AI for value-centric decision-making. Additionally, he highlights the possibilities beyond automation to include real-time recalibration of value models, enabling companies to better adapt to changing customer needs and market dynamics.
Why you have to check out today’s podcast:
- Discover the importance of custom packaging solutions designed to meet the unique needs of diverse users, adding significant value to their experience and allowing for optimized pricing strategies
- Find out how AI is impacting pricing strategies
- Understand the evolving role of pricing people: pricing analysts and pricing strategists
"What pricing people should be doing today is learning how to have productive conversations with AI agents."
- Steven Forth
Topics Covered:
02:44 - Discussing about platform pricing and solution pricing in the context of AI
05:40 - The challenge that pricing platforms presents when it comes to quantifying value for all users
07:06 - Generative AI versus computational knowledge AI in the case of Wolfram Alpha
10:20 - Highlighting the value of packaging solutions tailored to specific needs which can be more valuable to users
12:06 - What goes in the pricing world with AI around
18:38 - Pricing strategists becoming increasingly important, need for better systems to facilitate meaningful conversations and decision-making
20:11 - Would it be possible for AI to make people inside the company understand what value is to customers
24:08 - Six types of value drivers according to Ed Arnold
27:03 - The challenge of building large amount of value models
30:20 - Steven's best advice to pricing people
31:12 - Building a value model through client interviews
Key Takeaways:
"Why don't people focus more on value? I think part of this is because many of us find it easier to look inside our own company than outside to our customers." - Steven Forth
"In an uncertain world, having options and being able to generate options gives you a much more adaptive and resilient business." - Steven Forth
"They [pricing people] need to be learning how to ask the AI questions. They need to be learning how to train the AI so that it can better answer those questions." - Steven Forth
"They [pricing people] need to be understanding the strengths and weaknesses of the answers they're going to get. Because like it or not, you are going to be using an AI, you are using an AI, in your work today, even if you're not aware of it." - Steven Forth
People/ Resources Mentioned:
- Wolfram Alpha: https://www.wolframalpha.com
- Stephen Wolfram: https://www.stephenwolfram.com
- Mathematica: https://www.wolfram.com/mathematica/
- Pros: https://pros.com
- Zilliant: https://zilliant.com
- Ed Arnold: https://www.linkedin.com/pulse/how-quantify-value-service-ed-arnold/
- McKinsey: https://www.mckinsey.com
- Microsoft Co-Pilot: https://copilot.microsoft.com
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 18, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/listen-to-your-market-then-think/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Spades from the Impact Pricing card deck.
You've probably heard me use the words 'will I' and 'which one' in the past. 'Will I' are situations where our buyers are choosing to buy our product or not, but they're not choosing whether they buy our product or a competitor's product. When we can find ourselves in a 'will I' situation, we know that our customers are not price sensitive.
So, the key here is to know the difference. Are they comparing us to competitors or not? My recommendation is assume they're not. Because if we assume they are, we start talking about who our competitors are and they say, "Oh, you have competitors, let me go look at them." Instead, we talk to them about the value of solving the problem and why our product is going to help them solve that problem and get a huge return.
And we never even mentioned that a competitive alternative exists. When the customer says to us, "Oh, we're looking at X, Y, Z company." Then we know that we can shift to talking about how we're better than our competition. What are those features or capabilities that we do that our competition can't match?
But up to that point, let's make the assumption there is no competition. In fact, my favorite way to find out the answer, is there competition, is to ask the following question, "If you don't buy this, what will you do?" Notice that that question implies there is no competition. It doesn't say that go look at the competition.
So my recommendation, always assume there is no competition. Talk about the value of solving the problems, and then you can shift your sales technique after you realize competition is in the deal.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Arnab Sinha is a Managing Director and Senior Partner in the Philadelphia office of Boston Consulting Group (BCG) and the North American Lead for Pricing Topic, as well as Global Lead for Revenue Management.
In this episode, Arnab shares what's behind writing the book 'Game Changer' and discusses how the pricing strategy frameworks discussed inside the book works for the different industries like software, consumer packaged goods, pharmaceuticals, among others.
Why you have to check out today’s podcast:
- Discover how to create value across diverse industries and implement innovative pricing strategies that can revolutionize your approach
- Uncover the innovative pricing strategies used by pharmaceutical companies to market their products
- Find out the crucial role of creating value to effect strategic pricing
"Figure out how much value you want to share, and how you communicate that, because that's what drives long-term value creation."
- Arnab Sinha
Topics Covered:
01:14 - How he got into pricing and why he never regretted choosing it over mechanical engineering
03:48 - What's behind writing the book 'Game Changer'
06:21 - Pivotal role of value creation in pricing strategy as gleaned from the book
08:03 - How his pricing strategy framework be used in software companies
11:40 - Significance of understanding customer needs and tailoring offerings accordingly for both acquisition and retention, with competition in mind
14:25 - The strategic pricing approach for consumer packaged goods companies
17:34 - Understanding the 'uniform game' in the consumer packaged goods and how it is influenced by factors such as brand strength and price gap elasticity in relation to competitors
20:08 - From a static view of pricing strategy in the CPG towards a dynamic approach utilizing AI and machine learning to model the best pricing strategy
22:00 - Innovative pricing strategy in pharmaceuticals
26:42 - Pricing based on where value is created
29:22 - Arnab's best pricing advice
30:03 - Discussing on how much value should one keep
Key Takeaways:
"I think the competitor's price is a critical input. And this is where we weave it in through something like your brand strength and your brand equity." - Arnab Sinha
"And this is where I think our belief is, it is not just about the one-time value of one transaction, but you need to think about the lifetime value of all of the consumers you will be serving." - Arnab Sinha
"...at the intersection of the cost and competitive game, you need to understand if you are creating value and make a choice of how much value you want to share regardless of what game you're playing. Because in the absence of value creation, there is no transaction." - Arnab Sinha
People/Resources Mentioned:
- Jean-Manuel Izaret: https://impactpricing.com/podcast/563-game-changing-pricing-strategies-for-long-term-success-with-jean-manuel-izaret/
- Game Changer: How Strategic Pricing Shapes Businesses, Markets, and Society by Jean-Manuel Izaret and Arnab Sinha: https://www.amazon.com/Game-Changer-Strategic-Pricing-Business/dp/1394190581
- SAP: https://www.sap.com
- Oracle: https://www.oracle.com/ph/
- Quickbooks: https://quickbooks.intuit.com
- Microsoft: https://www.microsoft.com
- Coke: https://www.coca-cola.com/ph/en
- Pepsi: https://www.pepsi.com
- Walmart: https://www.walmart.com
- Kroger: https://www.kroger.com/
- Publix: https://www.publix.com
- Target: https://www.target.com
- Pfizer: https://www.pfizer.com
Connect with Arnab Sinha:
- LinkedIn: https://www.linkedin.com/in/arnab-sinha
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
Jean-Manuel Izaret leads BCG’s Marketing, Sales & Pricing practice globally. They partner with leading companies across industries to transform their commercial functions leveraging cutting edge digital and analytics capabilities to help them grow.
In this episode, Jean-Manuel reveals the impact of your pricing models on maximizing your pricing strategy.
Why you have to check out today’s podcast:
- Explore the factors behind the fluctuating gasoline prices, where price rises easily when the market is up, and takes time lowering when the market is down
- Get an exclusive preview of the subjects discussed in the Game Changer book
- Discover what a ‘choice game’ is all about
"Think about how to share the value with the market and with others, you'll bring long-term customers and loyalty, and you'll build a fantastic business for yourself."
- Jean-Manuel Izaret
Topics Covered:
01:36 - How he got into pricing
02:54 - Why gas price tends to go higher fast than it goes down
05:46 - Are gas price and other commodities coming back down
07:27 - What made him write the book and a sneak peak into the topics
12:29 - Important thoughts on value-based and cost pricing and identifying brands for illustration
20:29 - Relevance of elasticity in pricing
24:23 - His game of choice and why
26:45 - Industries that have huge advantage with value pricing
27:20 - Jean-Manuel's best pricing advice
Key Takeaways:
"It is helpful for anybody in any market to think about the value that they create for customers. And never thinking about it is usually a mistake." - Jean-Manuel Izaret
"Everywhere you are, think about what people on the other side are doing, and is it relevant for you? How can you learn from that?" - Jean-Manuel Izaret
"When people think about pricing, they tend to think about prices. They tend to think about the number. If you want to reframe the conversations about how you can gain more traction in the market, think about your pricing model." - Jean-Manuel Izaret
People/Resources Mentioned:
- Game Changer: https://www.amazon.com/Game-Changer-Strategic-Pricing-Business/dp/1394190581
- Shell: https://www.shell.comNetflix:https://www.netflix.com/ph-en/
- Apple: https://www.apple.com
- Napster: https://www.napster.com/availability
- Sony: https://www.sony.com/en/
Connect with Jean-Manuel Izaret:
- LinkedIn: https://www.linkedin.com/in/izaret/
- Email: jmi@bcg.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This one is the 9 of Clubs from the Impact Pricing card deck.
We often hear the word 'strategic' as in, "Hey, I'm making a decision today so that it grows my business someday in the future." Well, that's exactly what we want to do when we think about the lifetime value of a customer. I'm not so worried about, "Can I get the three year contract signed today?" Many companies do. But when you try to get the three year contract signed right away, you make it harder to win the customer.
But what if you took a one year contract? Or what if you took a one month contract? Or even had a free trial period. And you let people get into your product, and you deliver so much value that they never leave. What we just did was get them into our ecosystem. And then over time we can get them to buy more from us, to stay with us. And that's because we know we're delivering a ton of value.
This is what it means to focus on lifetime value. I'm okay taking a smaller number today because I know that over time this customer is going to grow with me and give me a whole lot more money that I'm trying to capture today. Whereas if we focus on the value of the three year contract, it's oftentimes hard to win that customer today.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 9 of Diamonds from the Impact Pricing card deck.
When we think about subscriptions, and I've talked to several companies who are trying to move from more of a transactional business to a subscription business, they think it's 'just pricing'. "Oh, we want to set our price this way." But it turns out it changes so much in your business, not just the way you set pricing.
One of my favorite things about the subscription business model is that buyers pay us for a continuous stream of benefits, meaning we're delivering benefits month after month after month. The question in your business is, are you truly delivering benefits month after month after month? In which case, maybe you have a good business for starting a subscription business model.
Then we want to think about, not only how are we delivering it, but then, how much value do they get each month? How do we start to capture that? And so, we can certainly price it, but we really need to structure our company around winning these customers.
And then we have to figure out, how do we keep them? How do we minimize churn? And over time, we figure out how to grow these customers. How to get them to upgrade or buy more from us? So, subscription isn't as simple as, 'let's change the way we do pricing'. It really is an entire business model.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dan Zatta is a leading management advisor in topline growth. He specialized in profit improvement on the revenue side, with extensive experience in pricing.
He is the author of the books ‘The 10 Rules of Highly Effective Pricing’ and ‘The Pricing Model Revolution’, translated into 10+ languages.
In this episode, Dan shares how these pricing models he mentions in his book can greatly impact a company's growth and profitability when used in a comprehensive approach.
Why you have to check out today’s podcast:
- Explore the various pricing models that can significantly influence your bottom line
- Discover a pricing model that helps you identify an additional unique selling point, ultimately boosting profitability
- Learn why it's crucial to have a holistic perspective of the company's overall impact before embracing innovative revenue models
"Make sure to be quick in increasing prices, ideally combine this with additional value to meet your profitability targets."
- Dan Zatta
Topics Covered:
01:13 - What finally got him into pricing after being a generalist
02:05 - A trick he does to gain sales peoples' support when increasing prices
02:32 - What inspired him to write his book 'The Pricing Model Revolution'
04:16 - Pricing as not an exact science
05:29 - An interesting fact about another reason for writing his book 'Revenue Management in Manufacturing'
07:34 - From an academic writing style to using language understood by non-pricing experts in writing his books
08:48 - What AI-based Pricing can do for your bottom line even when you are already an advanced organization
11:19 - Many more AI-based pricing opportunities available even with companies already using AI
12:34 - Explaining what Neuro Pricing is and the tool used for this
14:34 - Creating another source of competitive advantage in pricing with outcome-based pricing
17:18 - The need for comprehensive view into the company before adopting pricing models
19:31 - Defining Sympathetic Pricing
21:52 - Important thoughts on the idea of price fairness
25:21 - What is Psychological Pricing
27:28 - Dan's best pricing advice
Key Takeaways:
"Let's think about value also when we price and looking into outcomes could be one of those." - Dan Zatta
"If you are not changing your processes the way you're approaching how salespeople are compensated, then you risk having an issue with the model that maybe is great, but it's not pushed internally. And the same can be the case with incentives for clients." - Dan Zatta
"The impact of volatility of raw materials, there is still inflation in a number of countries. So rather than waiting, make sure that you're not losing time because the more time passes when costs are increasing, the more time you will need to recover profitability." - Dan Zatta
People/Resources Mentioned:
- The Pricing Model Revolution by Danilo Zatta: https://www.amazon.de/dp/1119900573/ref=tsm_1_fb_lk
- Revenue Management in Manufacturing: State of the Art, Application and Profit Impact in the Process Industry by Danilo Zatta: https://www.amazon.com/Revenue-Management-Manufacturing-Application-Industry/dp/3319302396
- Uber: https://www.uber.com
- Lyft: https://www.lyft.com
- Peter Drucker: https://en.wikipedia.org/wiki/Peter_Drucker
Connect with Dan Zatta:
- LinkedIn: https://www.linkedin.com/in/danilo-zatta/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 11, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/brilliant-price-move-by-amazon-prime/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 9 of Hearts from the Impact Pricing card deck.
I found it fascinating when I studied subscriptions coming from a more traditional or transactional type of business where people would buy something from you, and then you have to get them to buy again. In a subscription, people buy something from you and then they pay you month after month, or year after year.
And in that business model, there are several things that are unique. But one of them is that you suddenly have to focus on how do we keep a customer? We always have to win customers, but how do we keep that customer? And we've heard the word churn, and we know the churn is bad, and companies focus on how do I minimize churn.
And there's also a third revenue bucket and that's called grow. Once I have a customer who's paying me and getting value for my product, how do I get them to pay me more money next year than they paid me this year? And we can typically do that with things like raising prices, or getting them to upgrade, or using more of our product. There are several of these techniques.
What's interesting though is that the tactics that we use inside our company to win customers is different than what we need to keep customers. And different again than what we need to grow customers. We suddenly have complicated our business model because we really and truly do need to manage all three of those revenue buckets separately.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jon Jennings is the founder and managing partner of Jennings Executive Search. Established in 2014. His vision was to shape a firm anchored in transparency and value creation.
In this episode, Jon discusses the strategies for hiring pricing professionals and building a dedicated pricing team that significantly contributes to a company's strategic success.
Why you have to check out today’s podcast:
- Discover how to effectively structure your pricing team and determine the optimal number of pricing professionals to hire based on your company's size
- Explore crucial steps to assess pricing role offers, ensuring a thorough understanding and avoiding impulsive decisions
- Learn important factors to consider when hiring pricing professionals for high, mid, and entry-level pricing positions
"Once you can build those relationships with sales and the customers and understand what really makes them tick, it's a lot easier to price to it, to add value."
- Jon Jennings
Topics Covered:
01:38 - How he paved a path into pricing
04:04 - What great impact a little tweak in pricing can do
05:12 - At what point are they able to start helping clients fix their pricing
06:18 - When do private equity firms decide to hire pricing consultants and pricing professionals
09:21 - Designing a pricing structure for a $50M manufacturing company
12:49 - How many pricing professionals you should hire given the size of your company
15:41 - Opportunities for pricing roles these days
17:39 - The best thing to do when looking for pricing jobs
19:06 - Insights on writing your resume and putting it on LinkedIn
21:23 - Vetting pricing jobs before jumping in
24:22 - A chance to talk and vet for a thousand individuals for pricing roles
25:14 - What does Jon look for when vetting people for pricing roles
27:54 - The need to think outside of the box when you're a pricing professional
28:40 - Jon's best pricing advice
Key Takeaways:
When looking for job opportunities:
"Look through your network. Just like anything, take your time, take a breath, it's going to be alright." - Jon Jennings
“You don't need to jump at the first thing; evaluate it based on the merit of the opportunity." - Jon Jennings
When vetting a job offer or a candidate for a job:
"When it feels like they're covering something up or not, just not telling me the whole truth, that's when I get a little nervous." - Jon Jennings
"They understand things connect, so that skillset tend, if they have some business acumen and a little bit of personality to go with it, they translate well to pricing." - Jon Jennings
"I want to find people that like to break the wheel or build it, that's our approach to the more mid level. And the lower level is people that are just high achievers and with a quantitative math brain." - Jon Jennings
People/Resources Mentioned:
- Portco: https://www.portco.com
- GitHub: https://github.com
Connect with Jon Jennings:
- Website: https://jenningsexec.com/pricing-strategy/
- LinkedIn: https://www.linkedin.com/in/jonjennings/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 4, 2024, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-platforms-and-solutions/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 9 of Spades from the Impact Pricing card deck.
There are two major rules in pricing that are hugely valuable to your organization. The first one is value-based pricing, which simply means charge what your customers are willing to pay. The second one is to adopt price segmentation.
Think about this for just a second. No two buyers actually are willing to pay the same price. Which means every buyer has a different willingness to pay. If we really want to adopt value-based pricing, at its best, then what we're doing is trying to figure out, how do we get individual people to pay us what they're willing to pay?
Of course, this is impossible to do perfectly, but it's not impossible to say, hey, this type of person, this type of customer, gets more value from our product. They're willing to pay more because they get more value. We see this all the time.
For example, it could be that when we sell to Asia, they're more price sensitive so they end up with a better price. And when we sell in the US or Europe, we end up charging higher prices. This is price segmentation and that's where the value is.
There are several ways to do price segmentation. Those include understanding the characteristics of your customer. What information can you collect at the time of the transaction? And then, are there behaviors or hurdles you could put in their way so that those who are price sensitive are willing to jump that hurdle in order to get a better price?
So, my advice, think very hard about, how do you do price segmentation? How can you charge different customers different amounts based on their willingness to pay?
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Alex Costa is a Specialist in Strategic Pricing, statistical analysis, market intelligence, sales finance (P&L) statistical analysis, acting as a Sales Business Partner to guide the best pricing strategies, which increases revenues and margins (EBITDA).
In this episode, Alex discusses the importance of both hard and soft skills in achieving success. He also highlights three of the eleven essential skills for pricing professionals and shares his insights on value-based pricing, emphasizing its comprehensive impact on the value process.
Why you have to check out today’s podcast:
- Find the optimal skills to prioritize as a pricing professional
- Discover effective techniques for engaging with salespeople in a manner that fosters collaboration instead of resistance
- Learn how to share information and knowledge within the company to foster a collaborative effort towards achieving shared objectives
"Hard skills and soft skills play a huge impact for you to be effective in your career in pricing."
- Alex Costa
Topics Covered:
01:04 - How Alex pursued pricing
01:54 - Pricing is more than margin
02:47 - What he thinks is the best skill pricing professionals should have
04:16 - Why one has to think logically as a pricing professional
05:05 - Consultative versus reactive when engaging with sales
07:02 - How to invite collaboration rather than resistance from salespeople
08:55 - Discussing on the idea of sharing knowledge and information inside the organization
11:16 - Why emotional control matters
16:22 - What he thinks of value-based pricing
18:16 - Who should take the role of training sales teams for them to understand your product's value
19:26 - Looking at value not just of the product's attribute but the whole chain of it
21:53 - How you can get a hold of Alex's paper with this 11 skills
22:29 - Alex's best pricing advice
Key Takeaways:
"I think the most important thing to us as pricing professionals is to engage with sales objectives, to understand what the goals of sales teams are. But of course, align with the goals of the organization." - Alex Costa
"If you don't control your emotions, your emotions will control your career and your project." - Alex Costa
"When you look for the satisfaction from the customer, what their perspective of the value that they will take from your product or services, you can position your pricing better." - Alex Costa
"Sometimes they think, value comes just from the aspects of the product, the attributes of the product. But for me, the value in the mind of the consumer and the customers comes from the entire chain of value of the company." - Alex Costa
Connect with Alex Costa:
- LinkedIn: https://www.linkedin.com/in/alexandrecostaoliveira/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 28, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/three-types-of-b2b-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 10 of Clubs from the Impact Pricing card deck.
Face it, when you talk to a customer, what you really want to ask them is, "how much would you pay for them?" The problem is they won't answer that question.
First, they probably don't know the answer to that question. But more importantly, in the back of their mind, they're thinking, Hey, I can't tell them the truth because if I tell them it's really valuable to me, they'll end up charging me a higher price. So, I'm going to come up with a number much lower. I'm going to game the system, or play a negotiation game without them even knowing I'm playing.
Of course, that hurts us because we're trying to gather real information, how much would they pay?
One question I found that works relatively well, I wouldn't call it scientific, but it's a great way to get just a perception of people's pricing. And that is, "how much do you think other people like you would pay for this?"
It takes enough indirection in the question that they tend not to think about gaming the system. And instead they think, "Oh, well, that person over there is probably like me, so therefore they would probably pay this much." When you ask that question, what the buyer's thinking in their mind is, how much would I really pay, and that's how much I think other people would really pay.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value.
In this episode, Steven discusses the growing significance of showcasing economic value to customers and the challenges that companies encounter in accomplishing this, particularly with regard to AI monetization. There is a strong emphasis on the necessity for better understanding and communication of the value delivered by SaaS products to enable more effective value-based SaaS pricing strategies.
Why you have to check out today’s podcast:
- Look into the latest AI monetization report for 2024 and gain insights into the strategies for monetizing AI
- Find out the key trends in SaaS pricing related to AI for the year 2024
- Discover the compelling reasons why AI is truly revolutionary and why it's crucial to embrace this transformative technology
"Don't panic and cut prices."
- Steven Forth
Topics Covered:
01:37 - How is AI going to significantly influence SaaS and pricing this 2024
03:38 - The impact AI is going to have on most businesses in the interface, functionality, and internal workflow levels
06:59 - What this AI monetization report is all about
09:46 - Looking on the value of the solution more than just the AI tool
11:05 - Why B2B SaaS companies are under increased pressure to justify their prices based on the value delivered to their customers
13:12 - Quantifying and truly delivering value to customers and product management's critical function in understanding value
16:05 - Significant insights on customer success department's role in value quantification
17:02 - Discussion about using SaaS versus obtaining perpetual license
22:38 - Summarizing the three major trends this 2024
24:47 - Expressing optimism that companies adopt better tool sets to assess, track, document, and communicate economic value
25:38 - Steven's impactful advice
Key Takeaways:
"Vast new areas of applications are going to be opened by AI and things that we couldn't do, or were too expensive to do in the past become easy to do and very affordable to do, already are today." - Steven Forth
"If you can demonstrate value, then you have a lot of weapons that you can use against these [larger competitors]." - Steven Forth
"AI is going to be moving rapidly towards monetization, which means it has to be able to demonstrate value." - Steven Forth
"There's an overall pressure to better manage SaaS spending, which is going to lead to pressure on SaaS companies to be able to demonstrate that they are actually delivering value, not just happy users." - Steven Forth
"Cutting prices is not going to solve your problem. That could just increase your churn. There's no guarantee that cutting your prices will reduce your churn." - Steven Forth
"You can't compensate for a lack of value by lowering your price." - Steven Forth
People/Resources Mentioned:
- Open View:https://openviewpartners.com/blog/tagged/research-and-analytics/
- Amazon: https://www.amazon.com
- Google: https://www.google.com/
- IBM: https://www.ibm.com/us-en
- Salesforce: https://www.salesforce.com/ap/?ir=1
- Oracle: https://www.oracle.com/ph/
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 21, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-your-salespeople-dont-sell-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 10 of Diamonds from the Impact Pricing card deck.
Different buyers value our products differently, hence, what that should mean to us is we get to do price segmentation, we could be charging different prices. But from a sales perspective, once we've got a price set and we need to go out and do prospecting and find which customers we want to go sell to, guess which ones are the easiest ones to win? The ones where they perceive the most value from our product.
If somebody is going to use our product and make a million dollars, they care a lot more than someone who's going to use our product and make $10. Can we articulate where's the value of our product, who's going to get the value, and then find those people who really get a ton of value and focus on them. That's where we should be doing our prospecting. That's where we should be doing our marketing. And if we have a list of prospects to go deal with, those are the ones we should be spending our sales effort and energy on.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Todd Snelgrove is the Senior Director; Value Advisory at SAP. He is a value advisor who helps companies get paid for the value they create.
In this episode, Todd discusses the fundamental importance of value quantification in pricing and emphasizes the need for a structured process to carry it out effectively.
Why you have to check out today’s podcast:
- Discover the importance of prioritizing value over solely relying on the behavioral economics of pricing when it comes to pricing strategies
- Find out the effectiveness of quantifying value over simply offering discounts
- Learn about what constitutes a value conversation
"Have a structured process to quantify customer value. It’s not as hard as people think. Even if you're not perfect at it, it's better than nothing."
- Todd Snelgrove
Topics Covered:
01:05 - How Todd got into pricing
02:19 - Quantifying value in B2C
04:13 - The subconscious way of quantifying value
05:38 - Why behavioral economics matter less in B2B
08:05 - The decoy effect in pricing and how some tricks used in B2C doesn't work in B2B
12:16 - Evolving power dynamics in procurement and how salespeople should navigate dealings with procurement in different scenarios
17:31 - Performance guarantee over discount
20:26 - What transpires in a value conversation
22:20 - The telling versus the asking in a value conversation
25:20 - Tod's one piece of best pricing advice
26:18 - Why not many companies quantify value
27:08 - Todd’s book: Value First Then Price
29:09 - Tying cost and benefits to a value conversation
Key Takeaways:
"When you talk about value, talk about real dollars. It's okay to list benefits and all these other things. But when you say value, show how that's going to be more profitable." - Todd Snelgrove
"I spend a lot of my time getting procurement to realize that 10% value per year is better than a 10% price cut." - Todd Snelgrove
"Price becomes an issue but only after you've discussed value." - Todd Snelgrove
Resources/People Mentioned:
- Value First then Price by Todd Snelgrove: https://expertsinvalue.com/books
- AstraZeneca: https://www.astrazeneca.com/
Connect with Todd Snelgrove:
- LinkedIn: https://www.linkedin.com/in/toddsnelgrove/
- Email: todd@expertsinvalue.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 14, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/growth-comes-from-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 10 of Hearts from the Impact Pricing card deck.
Besides the alliteration of that meme, the two concepts are crucial. Pricing is possibly the most powerful marketing mix variable you have access to. You must have seen the reports that say, hey, if you could increase price by 1%, that likely increases your profitability by 10% for most companies or an average company.
Well, the only reason somebody is ever going to buy something from you is because they perceive that there's more value to them than it costs them in your price. And so, that means we need to be focused on what's the value to the customer. We need to know, how are they perceiving that value? What is the value that they're willing to exchange or they're thinking about as they exchange their hard earned money to buy your product?
When we think about these two concepts, then pricing and value, they go really hand in hand, very closely related. I know many companies ignore pricing, that you set it and forget it, and they need to think about that more. But even more companies are clueless about value. How is it that your customers perceive value?
You really should be spending more time, more energy, thinking about both of those concepts, pricing and value. And they go really, really well together.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script, obviously.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Maciej Wilczyński is a pricing expert and Partner at Valueships, a consultancy boutique specializing in software, cloud, subscription, and digital businesses. He is also a lecturer and faculty at the Wroclaw University of Economics, where he has finished his PhD title in strategic management, writing a thesis about software-as-a-service companies and their pricing capabilities.
He gained consulting experience at McKinsey & Company, where he led the EMEA part of Agile Insights solutions focused on digital marketing and customer insights.
In this episode, Maciej discusses the potential positive impact on your SaaS pricing when considering the removal of grandfathering for customers.
Why you have to check out today’s podcast:
- Discover significant insights to expanding your business and boosting your income with SaaS pricing strategies
- Understand the ins and outs of SaaS pricing and gain insights into how companies can effectively gauge the value of their offerings, empowering them to make confident decisions in pricing
- Unlock valuable insights about grandfathering customers and potentially double your income
"Value-based pricing has an ability to at least double your current business."
- Maciej Wilczynski
Topics Covered:
01:33 - Just wasn't cut out for a metal band fame
02:22 - How he got into pricing
04:19 - What Valueships is all about
05:31 - B2B SaaS pricing and what makes it interesting
08:12 - Buying growth with pricing
10:31 - Four major reasons companies don't raise prices
14:20 - Important thoughts on companies grandfathering customers [effect on short-term and long-term]
19:18 - No such thing as lifetime pricing
22:29 - Why pricing is hard and where should you get the motivation to increase price
24:57 - What you should bear in mind when increasing prices: listen to the majority and not to the few complaining minority
29:03 - Connecting your price increase to a customer-centric narrative
30:51 - Maciej's best pricing advice
Key Takeaways:
"You should forget the word forever or lifetime in pricing." - Maciej Wilczyński
"Where should companies look for the courage and energy to do it [pricing] is purely from value exercise." - Maciej Wilczyński
"To really understand the value, run as many case studies as you can, quantified case studies, try calculating the ROI of your service initially internally as an exercise, as a workshop in exercise, and then move and try to do it with your customers to see the power of the product." - Maciej Wilczyński
"Pricing starts from value, but if you're afraid of raising prices, simply look at your churn rates. If they're below four or 3%, you're good to go." - Maciej Wilczyński
People/Resources Mentioned:
- Patrick Campbell: https://www.linkedin.com/in/patrickccampbell
- Zappos: https://www.zappos.com
- Stephan Liozu: https://impactpricing.com/podcast/classic-value-based-pricing-how-to-get-started-and-how-to-succeed-with-stephan-liozu/
- Appsumo: https://appsumo.com
- Netflix: https://www.netflix.com/ph-en/
- Utpal M. Dholakia: https://hbr.org/2021/06/if-youre-going-to-raise-prices-tell-customers-why
Connect with Maciej Wilczyński:
- LinkedIn: https://www.linkedin.com/in/wilczynskim/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 7, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/dont-do-what-sirius-xm-did/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 10 of Spades from the Impact Pricing card deck.
When we think about what a buyer's decision process is, think about the two decisions they have to make, 'will I' and 'which one'. And it's really important for us to understand which of those decisions were pricing for.
The 'will I' decision simply asks, the buyers asking the question, should I buy something in this product category? That's a budgetary decision. They're really saying, is this problem valuable enough for me to spend money to go solve? When we're thinking about pricing and someone's only making that 'will I' decision, we need to be thinking about, what's the value of solving the problem?
The other decision the buyer might be making is the 'which one' decision. 'Which one' is, okay, I've decided I want to solve this problem. Now, am I going to buy your product or a competitor's product? How am I going to go solve this problem? They're deciding which one. And here, the pricing decision you have to make is what's the price of your product relative to the price of the competitive products. Relative to the price of the alternatives. And of course you must take into account the value of your advantages compared to your competitors.
So, as you're thinking about your pricing decisions, think really hard what's the decision our buyers are making. Are they deciding 'will I'? Will I buy something in this product category? Or are they deciding 'which one'? Which product will I buy?
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jeet Mukherjee is the Chief Strategy Officer at Holden Advisors. He is responsible for designing and executing the strategic vision for the company. His role includes developing intellectual property, new product offerings, and key partnerships for scalable growth and innovation across the business.
In this episode, Jeet delves into the nuanced strategies behind pricing power, featuring real-world examples, including iPhone and Intel's successful utilization of pricing power.
Why you have to check out today’s podcast:
- Discover the transformative power of value-based pricing gaining a profound understanding of its essence and significance
- Find out why many fail in selling from a value-based perspective and how you can break free from the conventional approaches that limit your pricing potential
- Uncover the nuances of driving pricing power, recognizing the pivotal role of context and the imperative need for precise segmentation
"As pricers, we need to have more confidence in our calculation of differential value in what we do to come up with our prices. And we should not be afraid to test and experiment, and change, and see, and track the difference in volumes we get and make adjustments. It's okay."
- Jeet Mukherjee
Topics Covered:
01:33 - Blessed to have worked with two pricing gurus and all praises to Tom Nagle
02:36 - Defining value-based pricing
03:30 - Describing his journey into pricing and what made him love it
06:38 - Why most don't sell from a value-based perspective
08:48 - Pricing as a much bigger topic many struggle with
11:59 - Understanding pricing power
19:38 - What you can use to drive pricing power, having the right context to understand who's got proper pricing power, and the need for precise segmentation
23:20 - Intel doing a great job in a push-pull marketing and building more brand equity
26:16 - Zappos nailing it in customer service
27:47 - Discussing price sensitivity in relation to pricing power [iPhone versus Samsung]
30:13 - Jeet's best pricing advice
Key Takeaways:
"I think we're changing the aperture and we're going through this process of pricing power to define it and understand it, because we're looking at it from more of a continuum." - Jeet Mukherjee
"Pricing has to be looked at as dynamic value drivers over time." - Jeet Mukherjee
"...you have to have that context to understand better who's got the pricing power by being more precise on the segmentation, as well as being very precise on the region that you're going to have a little bit of an anomaly." - Jeet Mukherjee
People/Resources Mentioned:
- Tom Nagle: https://www.linkedin.com/in/thomas-tom-nagle-2bb2288/
- Reed Holden: https://www.linkedin.com/in/reed-holden-913ab69/
- Ingram Micro: https://www.ingrammicro.com/
- HP: https://www.hp.com/ph-en/home.html
- Dell: https://www.dell.com/en-us
- Microsoft: https://www.microsoft.com/
- Intel: https://www.intel.com/content/www/us/en/homepage.html
- Zappos: https://www.zappos.com
- Amazon: https://www.amazon.com/
Connect with Jeet Mukherjee:
- LinkedIn: https://www.linkedin.com/in/jeet-mukherjee-58462a1/
- Email: jeetmukherjee@holdenadvisors.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 30, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/classic-the-art-of-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on November 23, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/do-you-need-a-new-pricing-metric/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Gleb Romanyuk is a Principal Economist at Wayfair. He leverages his Ph.D. in Economics and his extensive experience in the tech industry to develop cutting-edge solutions for competitive pricing and economic analysis.
In this episode, Gleb emphasizes the underutilization of data by most companies. He recommends harnessing its power to gain insights into business performance and develop optimized pricing strategies.
Why you have to check out today’s podcast:
- Understand an economist's role in analyzing data and optimizing pricing
- Learn to note the distinction between forecasting and prediction versus the causal inference
- Test price elasticity with causality
“I would encourage people to take advantage of their sales data when looking into setting prices. If you don’t have it then start recording it.”
- Gleb Romanyuk
Topics Covered:
01:56 - How he got introduced into pricing
03:46 - What is an economist's role in a company
06:04 - Distinguishing forecasting versus prediction
09:23 - Proving causality even with just observational data
15:06 - Case in point: does faster shipping improves revenue and profitability [how to go about the test and the variables used]
18:31 - What he thinks of the fact that most companies don't know how to use the data they gather
19:41 - Talking about more job opportunities for economists
20:49 - Highlighting a fascinating finding on using value pricing
23:16 - Sharing his insights on Mark's comment of not favoring taking into account price elasticity for pricing
24:46 - Gleb's impactful pricing advice
Key Takeaways:
"You can learn a lot about the performance of your business [by taking advantage of your sales data] and do better than just pricing by the market or pricing by the cost." - Gleb Romanyuk
"Can we measure the long-term elasticity that takes into account the competitor's response? Usually we can't really get at it because it involves strategic interactions. I think what we do about it is we take market price into account. But also it's important to understand to which extent your products are differentiated from the competitors and how fierce the competition is." - Gleb Romanyuk
People / Resources Mentioned:
- Wayfair: https://www.wayfair.com/
- Amazon: https://www.amazon.com/
Connect with Gleb Romanyuk:
- LinkedIn: https://www.linkedin.com/in/glebromanyuk/
- Email: gleb.romanyuk@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 16, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/what-comes-after-product-market-fit/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Clubs from the Impact Pricing card deck.
There's almost never a good reason to lower prices. We've seen that a 1% price increase can lead to a 10% improvement in profitability. Well, the opposite is true too. A 1% price decrease could lead to a 10% decrease in profitability. And that's painful.
As a general rule, I would never ever lead a price decrease. I'm not lowering my prices. And the only thing that would ever prompt me to, is if my competitors lowered their price first and I had to keep up with them. I had to match whatever price decrease they put out because they were taking too much of my share. But even if my competitors lowered their price, I wouldn't do an across the board price decrease.
Instead, I would look at where is it that my competitors are taking my business. And can I do a price decrease just on that piece of business? Let's start thinking about price segmentation and market segmentation, understanding where that competitor is powerful, is available, and only lower prices in those places where we have to in order to keep our market share.
But a great rule is just never lower your prices, unless you have to.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, talk for one to two minutes about what that card says. You'll become a better speaker and expert. Oh, and you can play games with these cards.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
There is something about pricing that really gets me excited. Maybe it was my humble beginnings. I'm sure I grew up with more than many people. But from my perspective, we didn't have enough. We needed to make every dollar go as far as it could.
At Christmas time, I would get out the Sears catalog and quickly turn to the toy section. I studied every item, in the boy section of course. I would circle, and circle, and circle. I wanted so much.
Christmas morning, Santa brought me a few of those toys. My parents made us three kids take turns. I hated having to wait for my brother and sister to take their turns. It was so fun ripping into a package, screaming with excitement. It was the kind of joy we rarely experience as adults.
After we kids had opened the Santa packages, it was time for the adults and all of the other gifts. One by one, we would open gifts. It was slow, and tedious, and boring. This is where I got socks and underwear.
Completely underappreciated at the time, but several times during this tradition, someone would get a nicer gift from Mom and Dad. Like a sweater, or a jacket. And inevitably, Mom would have a story, "Oh, I found that one at Macy's, and it was just like a more expensive one, but half the price." Or, "Oh, I saved 33% on that using green stamps." Or, "Oh, I shopped at four different stores and finally found a great deal on that one."
My mom loved saving money, and she loved telling us about it even more. I didn't know it at the time, but I was learning how important price was to her. Of course, this wasn't just at Christmas. But around the tree on Christmas morning, she had an audience. She had pent up stories she couldn't share until the gift was opened. She was in her element.
Maybe my love of pricing started because I wanted to understand my mom better. Who knows? But there are few things I like better than figuring out how people think about price. I am extremely grateful for what mom and dad did for us. They provided so many great memories. I loved Christmas as a child. I loved my mom who left us several years ago. And I still love pricing.
This Christmas, I hope you find great deals on all of the gifts. And especially the memories that you give. Merry Christmas and Happy Holidays.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on November 9, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/software-shrinkflation/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Diamonds from the Impact Pricing card deck.
It's true. If you're winning them all, you're not charging enough. First, you have to believe that every buyer is different. Every buyer has a different willingness to pay. If every time you go bid on someone and you know that they have a different willingness to pay, and yet you always win, that means that most of your buyers, if not all of your buyers, were willing to pay you more.
In fact, it's probably a fair assumption that every time you win a deal, you left money on the table. The buyer was probably willing to pay you a little bit more, or a lot more, than what the price was you finally settled on. What that says to me is that if we never ever lose, we're nowhere near that price point that says, Hey, we're losing the right number.
So, once again, if you were to raise your price by 1% that has a 10% impact on profitability, potentially, and probably zero impact on sales because you're winning everything already. And even if you lost a couple deals, you're not going to lose 10% of your deals. And so, that's a really smart thing for you to be doing if you're after more profit, which I hope you are.
And so, look at your win ratios. Are you winning every deal you go after? And if you are, raise prices.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert. And, you can play games.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value.
In this episode, Steven advocates for proactive scenario planning, encouraging businesses to identify critical uncertainties and fortify their pricing strategies for the uncertainties of the future.
Why you have to check out today’s podcast:
- Understand the significance of pricing as a strategic element often overlooked in planning, and recognize its pivotal role in post-COVID economic landscapes
- Acknowledge the shift to a sounder economic period, where capital has a tangible cost, emphasizing the importance of net present value as a cornerstone of planning assumptions
- Prioritize fixing issues strategically, considering both short-term and long-term plays, and embrace scenario planning for effective pricing strategies in a dynamic environment
"I think we are settling into a sounder economic period where capital has a cost, net present value matters, and we need to have that as a planning assumption."
- Steven Forth
Topics Covered:
01:38 - An observation about pricing being overlooked in strategic planning for 2024 and pricing being just an afterthought
04:20 - The need to strategically approach pricing in the context of the next three years post-COVID and thoughts on the monetization of generative AI
07:24 - Important thoughts on what kind of impact will AI have in businesses in the years ahead in comparison to what blockchain years ago
09:32 - From low interest rates to normal range, the importance of capital costs and net present value as part of planning assumptions.
13:05 - The need to take realistic steps to investments in AI, impact of non-zero interest rates on capital costs, the stabilization of buying behaviors into 2024 and how all these are considered in pricing planning in 2024
18:47 - Prioritizing what needs to be fixed first rather than fixing all at once and risk messing up everything
19:52 - How often should one conduct a pricing strategy
22:25 -Two key things in mind when planning for 2024: first establish baselines and trends, then aligning pricing with the overall strategic goals of the company
27:13 - What it means to have a portfolio point of view when making pricing planning and how to implement a faster cadence to reach your pricing goals
30:09 - Attributing business results to pricing changes and introducing the concept of causal analysis
Key Takeaways:
"I think we are settling into a sounder economic period where capital has a cost, net present value matters and we need to have that as a planning assumption." - Steven Forth
"You can't really do strategic planning if you don't understand where you are and how you got there." - Steven Forth
"I would encourage people to at least consider looking at scenario planning where you plan for more than one scenario. You identify critical uncertainties and you plan for each of the critical uncertainties. That approach would make a lot of sense for pricing." - Steven Forth
People / Resources Mentioned:
- Judea Pearl: https://en.wikipedia.org/wiki/Judea_Pearl
- The Book of Why: The New Science of Cause and Effect: https://www.amazon.com/Book-Why-Science-Cause-Effect/dp/046509760X
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 2, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/system-1-and-system-2-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Hearts from the Impact Pricing card deck.
If you have the ability to raise your prices and you can still sell the same or just slightly fewer products, you are almost guaranteed to make much more profit. There are many studies out there that show a 1% increase in pricing can yield a 10% improvement in profitability. Now, how does that make sense?
It makes sense because if you assume for a second that you have 10% gross margin on your product. So, I'm going to throw some numbers at you here. Assume that it costs, you're going to sell something for $100. It costs you $90 to make it. So, you have 10% gross margin and you're making $10 in profit on that product, or on that sale.
If you can raise your price 1%, so we go from a 100 to 101, we just raised our profit from 10 to 11. And that's because raising price has zero impact on our costs. Every dollar we make from the price increase goes directly to the bottom line. So, if we went from 100 to 101, we increased price by 1%. We took our profit from 10 to 11. We increased our profit by 10%.
Obviously, that 10% number has everything to do with what's the gross margin of your product at the moment, and that's how you could determine. But price increases go straight to the bottom line without impacting or being affected by our costs. And so, therefore, it's often the single most profitable, most powerful, marketing mix variable any company has.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert. And, you can play games.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Finn Helmo Hansen is the CEO and Co-founder of Price Beam and Stratinis, helping businesses use pricing and revenue growth to win.
In this episode, Finn discusses the two companies he founded - Stratinis and Price Beam - and their significant contributions to the field of market research in pricing. He also sheds light on effective pricing optimization strategies.
Why you have to check out today’s podcast:
- Find out how Price Beam does market research for optimizing pricing using a cloud-based technology
- Discover what advantages and capabilities conjoint analysis have over other market research techniques
- Learn insights into the pricing optimization frontiers that are on the rise
"It's not about communicating once you've launched the price increase or even the day before, it's a continuous communication. And if you as a pricing team think that you're communicating enough, then double it."
- Finn Hansen
Topics Covered:
01:13 - What paved his route to pricing
02:29 - Is there truth to wine quality equals higher price?
03:24 - What prevent wineries from raising wine price
05:02 - How do these companies he created, Price Beam and Stratinis differ from each other and why he created these two
07:17 - What specifically does each of these companies do?
09:25 - More in-depth discussion of the business structure of each company
11:09 - How does Price Beam and Stratinis relates to or differs from Conjointly [the process of gathering data up to analysis]
13:59 - The way AI [called Tool Plus] works in the whole process of data research and analysis
15:30 - What more can conjoint research method unpack that historical can't?
21:43 - Distilling the concept of shrinkflation
24:56 - Finn's comments on companies increasing prices by way of package machinations
27:37 - The next frontier in price optimization
29:41 - Testing different promotional alternatives
30:47 - Finn's best pricing advice
Key Takeaways:
"The next frontier in price optimization is going to be around promotion optimization, especially in CPG, because there's a lot of money there." - Finn Hansen
"You need to communicate as much as possible, talk about the value." - Finn Hansen
"Communicate about prices all over the year and sell internally." - Finn Hansen
"Pricing communication is key." - Finn Hansen
People/Resources Mentioned:
- Survey Monkey: https://www.surveymonkey.com
- Momentum Now: https://www.themomentum.com/momentum-now
- Conjointly: https://conjointly.com
- Carrefour: https://www.carrefour.com/en/group/stores
Connect with Finn Hansen:
- Email: finn@pricebeam.com / finn.hansen@pricebeam.com
- LinkedIn: https://www.linkedin.com/in/finnhelmohansen
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 26, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-5-hows/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Spades from the Impact Pricing card deck.
Many companies use cost-plus pricing and that's understandable because it's easy. It guarantees they're going to make a profit for every sale they make. I get it.
When we shift to value-based pricing, we start thinking about what's a buyer willing to pay us. And now, think about what a buyer is willing to pay and that value that they place on our product actually has nothing to do with the cost of us manufacturing it.
In fact, if you're used to buying something, whatever it happens to be. Let's say you're buying your favorite shirt and you buy five of these shirts every single year, and you just love it. And one year the cost of materials goes up. And the manufacturer says, okay, we're going to double our price because our costs went up. You don't really care that the costs went up. What you care about is, do I still want to pay that much? Or do I want to pay twice as much to get the shirt that I really like or not? So you're not thinking, what's the cost?
Now, oftentimes companies use costs to justify price increases. And we do that because our customers often think price is related to costs and it makes them feel a little bit better. It makes it feel like we're not just trying to raise prices and gouge them. But in truth, the value they get, the decision they're making, am I going to buy this product or not, has nothing to do with your costs. And everything to do with how they perceive the value of your product.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Julie Scanlon is a D&I Leader 2023 (D&I Leaders: dileaders.com). She enables organizations to enhance diversity and inclusion by providing consultancy, bespoke training solutions and interventions. Supporting individuals and organizations with executive coaching, professional development and career change coaching.
In this episode, Julie highlights the challenges women face when it comes to negotiating higher pay, placing them at a disadvantage compared to men. UK studies reveal the significant disparity in earnings between genders. Julie's primary focus is on addressing cultural and structural inequalities, and she offers insights on empowering women to strive for equal treatment.
Why you have to check out today’s podcast:
- Understanding the gender pay gap that exists between men and women and the necessary approach to bring about change
- Learn techniques to effectively mentor women entrepreneurs and businesses led by women, while avoiding gender bias
- Find ways to promote the recognition of women's worth and empower them to confidently price their value
"Take the risk and ask for it."
- Julie Scanlon
Topics Covered:
01:44 - What makes her drawn to the topic about women and men entrepreneurs and their attitudes towards pricing
02:50 - Julie's thoughts on Mark's statement that women are less confident than men about their pricing and business
05:48 - What could be the reason for gender pay gap in women if it is not about one’s confidence in question here
09:40 - Her thoughts on Mark's comment that the problem is with women not asking for pay in reference to a situation raised by Julie
11:14 - A case of 'who knows and who asks'
12:50 - Understanding why there's a bit of a problem for women getting a no for an answer
14:39 - The best approach to coaching women entrepreneurs and those women running companies
17:07 - Julie's suggested strategies for coaching women and the necessary shift in approach
20:39 - Julie's reply to Mark's question if there is the same study made in the US about the gender pay difference
21:58 - Her reaction to Mark's desire to help women get that 43% raise in pay
23:02 - Julie's best pricing advice
Key Takeaways:
"It is not that we're not asking in the same way that men are, but it might also be that there's different kinds of biases that are going on in the world that mean sometimes we don't get what we ask for." - Julie Scanlon
"It is actually being aware, raising awareness of the potential gender differentials. You are saying here as a kind of person sitting in front of me that you like to treat people equitably. The thing is, the world doesn't do that. So recognizing the world doesn't do that and thinking, okay, what can I do to mitigate against some of that unequal treatment by the world? So that might then help you adapt the way that you coach the individual that's in front of you." - Julie Scanlon
"The ‘being coachable’ question is absolutely vital regardless of gender. Absolutely, you need to be ready for it and you need to be open to it and not defensive." - Julie Scanlon
People/Resources Mentioned:
- Sky News: https://news.sky.com
- IPSE: https://www.ipse.co.uk
Connect with Julie Scanlon:
- LinkedIn: https://www.linkedin.com/in/dr-julie-scanlon/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 19, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/we-have-room-for-negotiation/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Clubs from the Impact Pricing card deck.
Value-based pricing is truly a goal or an attitude, but it's never finished because we can't be perfect. We can't read a customer's mind. I define value-based pricing as charge what a customer is willing to pay, but if you can't read a customer's mind, you don't know what that customer is willing to pay.
And in fact, all customers are different. And so, we constantly tweak and test new techniques. We add new price segmentations. We think about different market segments. We test our pricing and price increases with certain customers. So, we're never done with our value-based pricing.
We always want to be thinking about how is it that our customers are getting value from our products? How might they be using it differently? What was the value of the feature capability we just added to them? Value-based pricing is an ongoing process so I truly think of it as an attitude or a goal.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert. Oh, and you can play card games.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Neil Fitzgerald is an experienced, driven, and accomplished pricing and revenue professional, with a wealth of experience while working for leading, high-profile companies. Proven in exceeding all bottom-line expectations. Experienced in cruise, hotel and vacation rental industries.
In this episode, Neil shares the crucial role of pricing in the travel industry and its impact on the bottom line success. He emphasizes that achieving pricing goals is not solely reliant on AI, highlighting the importance of collaboration and building relationships with other stakeholders in the company.
Why you have to check out today’s podcast:
- Explore effective pricing strategies for one-time opportunities in the travel industry to optimize revenue
- Learn to strike a balance between short-term gains and long-term profitability, ensuring your pricing decisions don't compromise future success
- Discover the importance of guiding customers on a journey, expediting their consideration of revenue and pricing management
"Don't assume that everyone else in your business understands what you're doing. So, take the time to listen to other people, and take the time to communicate and collaborate with the other people in your teams and the other stakeholders in your business, and take them on the journey."
- Neil Fitzgerald
Topics Covered:
01:20 - How Neil get into pricing
03:02 - How does pricing for travel differ from any other pricing?
04:51 - The challenge that comes with pricing the travel industry
07:37 - Pricing strategies in other industries that can work best in the travel industry
09:53 - Neil's thoughts on Mark's suggested limited time pricing offer for a cruise ship basing it from Chipotle's food pricing
11:59 - Discussion about one pricing strategy that Disney implemented and had to be discontinued
13:42 - Pricing insights from crowded airport lounges nowadays gleaned from Mark's experience
16:11 - How does he get people sold to the idea of revenue management
18:35 - Talking about AI and pricing algorithms
20:50 - Neil's best pricing advice
Key Takeaways:
"It is interesting in travel, when you do try and do those one-off opportunities to get a higher price point, you've got to be careful that it really, really is exclusive and it isn't so broad because then you can create too much demand." - Neil Fitzgerald
"It's an interesting business case for pricing managers about how Disney built out this fantastic product for the Star Wars hotel, charged thousands of dollars a night, and then has had to close it in a very short time period because they couldn't get the revenues that they were expecting." - Neil Fitzgerald
"I always think when it comes to pricing, even when you're more on the revenue management side and you are looking at your supply and demand patterns, you do have to have an awareness of the overall cost basis as well, because it can be quite easy if you're not careful to overprice." - Neil Fitzgerald
"It's going to be an interesting case about how airlines effectively raise, find ways of charging guests more so that they're reducing the demand without upsetting the most low guests." - Neil Fitzgerald
"We can't produce demand out of thin air and we can't produce higher margins out of thin air. We have to take people on the journey." - Neil Fitzgerald
People/Resources Mentioned:
- Chipotle: https://www.chipotle.com/home
- Virgin Voyages: https://www.virginvoyages.com
- Green Bay Packers: https://www.packers.com
Connect with Neil Fitzgerald:
- LinkedIn: https://www.linkedin.com/in/neil-fitzgerald-55122591/
- Email: neilf@expeditions.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 12, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/lessons-from-amazons-nessie/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Diamonds from the Impact Pricing card deck.
We often talk about how we want products that are different from our competitors. And if we think about what we want to build, we want to build products that are better, that are somehow differentiated. And when we do that, we've truly built value for our customers because our products are better than our competitor's products.
However, sometimes our customers don't know that our products are better. And if they don't know our products are better and they've never used our product before, then we're not going to get paid more because our products are better. And so, that's a customer's perception. We need to make sure that our customers perceive our products to be better.
In the ideal world, we build products that are better. We communicate that ideal differentiation to our customers. And our customers then choose to buy our product because they've perceived that value.
Now, it's possible that we can communicate value that may not be true, or we could communicate value that may not be differentiated. One of my favorite papers I read when I was a doctoral student was titled something like, Meaningful Differentiation from Irrelevant Attributes.
The example they like to use was Folgers Mountain Grown Coffee. I mean, it turns out all coffee is grown in mountains, so Folgers isn't differentiated with that. But the fact that they tout it, the fact that they talk about it and communicate it, almost makes it feel like they're differentiated. So, you could think of that as perceived value, even if it isn't real value.
So, our job really should be, let's create products that are better than our competitors and let's communicate that to our customers.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert. And, you can play card games.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Chussil is the founder of Advanced Competitive Strategies, Inc. He is an expert in qualitative and quantitative business war games, custom strategy simulators, executive education and management development programs. Highly rated speaker, published books and dozens of articles on business and competitive strategy.
In this episode, Mark shares how simulating pricing strategies before actually implementing them can do away with costly outcomes thereby improving one's bottom line.
Why you have to check out today’s podcast:
- Discover the essence of the Top Pricer Tournament
- Enhance your pricing strategy by utilizing simulation techniques to mitigate potential risks and minimize losses
- Find out fascinating insights and findings from the 'Top Pricer Tournament' and learn what to expect when participating in this exciting event
"If we choose a good strategy that turns out to be bad, what we have actually encountered is a false positive. And what we need to do a whole lot better in business is to be able to distinguish the false positives from the true positives. And that's what these simulations are about."
- Mark Chussil
Topics Covered:
02:59 - Differentiating decision rules versus decisions
05:31 - Mark Chussil agreeing to what Mark Stiving says in reference to Axelrod's 'tit for tat' and 'tit for tat with forgiveness'
07:16 - Drawing inspiration from Axelrod's work, Mark describes his own contribution
09:51 - Mark Chussil's perspective on Mark Stiving's assertion that companies prioritizing profit outperform those aiming for market share
11:15 - Findings about 'tit for tat' on why it doesn't work
12:17 - What is 'Top Pricer Tournament' and how it relates to or differ from 'Prisoner's Dilemma'
16:07 - Surprising findings from his own 'Top Pricer Tournament'
21:37 - Things to expect when you join Top Pricer Tournament
24:58 - Mark's best pricing advice
27:12 - Relating strategy to a decision
Key Takeaways:
"Strategy is a bet." - Mark Chussil
"In the Top Pricer Tournaments, and in life in general, we have situations where we can make great decisions, but somebody else has made a better decision or somebody else has come up with something that we didn't think about." - Mark Chussil
"I have seen people come up with strategies that I know I never would have thought of. And there's also a few that are in the Top Pricer Tournament that no human has selected yet, and that would outperform any of the ones that humans have selected so far." - Mark Chussil
People /Resources Mentioned:
- The Evolution of Cooperation by Robert Axelrod: https://www.amazon.com/Evolution-Cooperation-Revised-Robert-Axelrod/dp/0465005640
Connect with Mark Chussil:
- LinkedIn: https://www.linkedin.com/in/markchussil/
- Email: mchussil@competing.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on October 5, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/rules-of-thumb-for-price-increases/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Hearts from the Impact Pricing card deck.
Value-based pricing has many different meanings. Different people use it differently. Oftentimes, it's used to say, what's the value of each individual feature that's different between your product and your competitors, and add that to your competitors price. And by the way, that's a great way to think about value and value-based pricing.
But the easiest definition I've heard of for value-based pricing is, charge what your customers are willing to pay. And I love this definition because sure, it takes into account the fact that we sometimes have competitors. And we want to know what's the value of our differentiation relative to our competitors' products.
Absolutely, these are crucial things for us to know. But we also get to discover, what happens if they're not considering competition at the time? Or, what happens if it's raining and we want to sell an umbrella? So, these differences in time, differences in use cases, these things all have impact in how our customers value our products. And likewise, how much they would be willing to pay for our solutions to their problems.
So, I love this concept or this idea that says, look, we all want to charge based on how much value our customers are getting. That would be value-based pricing. But the way to think about it is, how much is a customer willing to pay because that's how much they value your product.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert. By the way, you can also play card games.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
John Mansour founded Product Management University to unlock one’s full growth potential by making quantifiable customer outcomes the starting point for everything.
In this episode, John explains the concept of buyers trading money for value. Therefore, it is crucial to consider the quantifiable value aspect, as it forms the basis for developing effective pricing strategies.
Why you have to check out today’s podcast:
- Understand why it is crucial to prioritize providing value to customers when a company's sustainability is on the line
- Learn the difference in measuring quantitative value in B2C and B2B contexts in order to effectively deliver the value and achieve the desired outcomes for your customers, and price your offer accordingly
- Discover how to identify the most straightforward quantifiable value component and use it as a foundation to develop the optimal pricing strategy
"The quantifiable value piece is so important in what we do, which is, if you can quantify a unit of value to the customer for what your products are doing, that is a good starting point to figure out your pricing."
- John Mansour
Topics Covered:
01:31 - Reading a snippet from John's LinkedIn About Section
02:04 - What prompted him to conceive that idea in his LinkedIn About section?
04:56 - Why often customer value comes only secondary to most companies
06:49 - A matter of a discovery journey and digging down the customer's why
09:28 - One key thing to understand when dealing with your customers' key decision makers for your questions to be relevant to them
11:17 - Quantifying value in B2C versus B2B
12:52 - Ways to measure quantitative value
15:03 - Measuring quantitative value other than in dollars
19:26 - A process for identifying quantifiable value [case studies illustrating this]
22:43 - John's best pricing advice
Key Takeaways:
"If you deliver quantifiable value to the customer, it's going to come back to you in spades to your own organization and support whatever your strategic goals are." - John Mansour
"It's a matter of just understanding what their priorities and their agenda is. Because if they're going to trade value for money, we have to understand what's valuable to them and how it can be quantified." - John Mansour
"The dollars aren't always at the forefront. It's the impact that you have on things that are important." - John Mansour
"The more you can quantify those units of value, the easier it is to come up with a price that you can sell because you're selling the value." - John Mansour
Connect with John Mansour:
- LinkedIn: https://www.linkedin.com/in/johnmansourproductmanagementuniversity/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This one is the Queen of Spades from the Impact Pricing card deck.
We really should be competing on value, not on price. We often think we're in a price war with our competition. We think our competitors are competing on price because we watch them give deep discounts to customers when we're in negotiations and we're wondering, why are they competing on price? But if you think about it, we responded with deep discounts on our products, and they look at us and they say, why are they competing on price?
What we really need to do is hold our price, try to maintain that price at a nice high level, and instead explain why our product is worth so much more money than our competitors. If our competitors are going to lower their price, it's probably because their product isn't as valuable as our product. We need to learn what does value truly mean to our customers and help them understand how much value they're going to get.
When we learn to create, communicate, value better, we'll be able to capture more of it in the way we price and the deals we close.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our playing cards, pick a card, read the saying, and talk for one to two minutes about what that card says. You'll become a better speaker and expert. By the way, you can also play card games.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Clubs from the Impact Pricing card deck.
Sadly, too many companies still use cost-plus pricing. We take the cost of manufacturing or creating something, we add a margin, and there's our price. It's easy. We know we're making margin, but are we maximizing our profit? Maybe we're pricing so high that we miss out on some customers, or maybe we're pricing so low that we're missing out on what some customers would be willing to pay us.
Think about it this way. Imagine that it costs you $10 to build something, all in. Whatever costs you want to consider, great. And you have a buyer out there that's willing to pay you $100 for it. What's the profit-maximizing price that you could charge? Well, it's a hundred dollars. If you charge 99, you left a dollar on the table. If you charge a hundred and one, that buyer's not going to buy. And so, a hundred dollars is the best you could possibly do with that buyer.
But what if instead of costing you ten dollars, what if it cost you twenty-five dollars to make it? Same buyer. What price would be the profit maximizing price? Well, obviously it's still a hundred dollars. Mind you, we make less money because our costs are higher. But the best we can do price-wise is the $100 because that's what our customer is willing to pay.
When we think about pricing this way, we're not saying costs don't matter to business. What we are saying is costs don't really matter to us setting our price. Yes, we want to make sure our prices are above our costs. We want to make sure we're making money. So, think of it as a limit. But it isn't the thing that drives our price levels.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Nikhil Kalla is a Global Pricing Manager at Ingersoll Rand who collaborates closely with regional pricing and global cross functional teams to drive projects that build pricing governance, create value propositions, align pricing with the market by applying segmentation, harmonization, rationalization and market research.
In this episode, Nikhil shares the significance of customer segmentation in developing a product that caters to different pricing tiers - top, middle, and low. This approach ensures that the product aligns with customers' willingness to pay based on the value they receive.
"If we had known our customer more or the most, you would have been able to segment your market and gain maximum on your profitability."
- Nikhil Kalla
Why you have to check out today’s podcast:
- Learn how customer segmentation drives different pricing points while still attracting customers from various segments
- Gain insights into the significance of customer segmentation in shaping product design and establishing pricing strategies that cater to customers' varying levels of willingness to pay
- Find out how proper communication of your product's value can help you gain the most advantage in pricing
Topics Covered:
01:46 - What's all this obsession of Nikhil over mastering Rubik's cube
02:52 - How he found himself in pricing
04:31 - Defining customer segmentation
07:09 - Customer segmentation by way of price segmentation
08:59 - What goes into approving different price points for different customers and even for the same ones
11:20 - What drives different pricing mix
17:18 - Market segmentation as a way to sell your products more intelligently
19:40 - How this works: Two different products targets two different market segments with two different price points
26:42 - Explaining what real-life scenario versus assumptions when talking about value to price ratio[how packaging works as part of customer segmentation]
30:23 - Nikhil's best pricing advice
Key Takeaways:
"Customer segmentation is all about deriving value, the maximum value from your customer base." - Nikhil Kalla
"Other than just being value and pricing, I feel there's more about communication of that value and then convincing part to be able to fetch maximum price so that the ratio of value by price is least as a win for me if I'm the supplier. And it has to be maximum so that the buyer gets to gain the most out of that transaction." - Nikhil Kalla
"When it comes to having the ability to sell to a slightly non elastic market where the demand is going to be expected to stay the same, you would always want to rely on pricing as a lever. Because everything that comes through pricing just goes to your pocket." - Nikhil Kalla
Connect with Nikhil Kalla:
- LinkedIn: https://www.linkedin.com/in/nikhil-kalla
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 28, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-your-nrr-isnt-better/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Diamonds from the Impact Pricing card deck.
We know that customers trade money for value. They're buying value, but what kind of value? There's lots of ways to break value up, but in this meme we want to talk about the difference between perceived value and real value.
Let's imagine there is this true measurable amount of value. For example, maybe I'm selling a gold coin and that gold coin actually has a value that I could look up online and say, what's the value of this coin? Got it.
But when I'm selling a service or I'm selling a product, I can't just go look up online and say, what's the value of this? Especially to me, because I don't know how I'm going to use it. I don't know how it's going to create more profits. And so, what I'm willing to pay is based completely around how much value do I think I might be getting from that product.
Now here's a great example. Imagine that you're selling a coffee cup. So what's the value of a coffee cup to somebody, right? Maybe it depends upon what the design is on the front, or who really wants it, or what the lid looks like. I mean, there's lots of different factors that might define what someone's willing to pay. And so, they say, yeah, I'd pay 10$ for that coffee mug.
But what if there was a gold coin at the bottom of the coffee mug when they bought it, and that gold coin is worth 1, 000$. They just bought 1, 000$ gold coin for 10$ because their perception was, hey, it's a coffee mug. They didn't perceive the value of the gold coin at the bottom. They're not buying the true value, they're only buying the value they know about.
How do we use this information? Well, it means to us that we have to be marketing and selling the true value of our product. Because if we're not communicating our value well to our buyers, they're not using it as they make decisions on should they buy our product or not, and how much would they be willing to pay for it.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
As a consultant, author, advisor, and speaker, Scott K. Edinger creates positive change for clients and is recognized as an expert in the intersection of leadership, strategy, and sales. He is the author of The Growth Leader: Strategies to Drive the Top and Bottom Lines.
In this episode, Scott delves into the powerful link between good selling and good leadership. He highlights the significance of persuading others to embrace your vision and strategies as a leader, much like enabling people to invest in the desired outcomes that your product can potentially offer them.
Why you have to check out today’s podcast:
- Deep dive into how selling and leadership closely interrelate with each other
- Find out why sales experience is the underrated differentiator
- Learn how expanded solutions make way for higher margins
“If you really want to think about pricing, then it's not a spreadsheet exercise. It's an exercise in thinking about how do we create value in the sales process. And that will determine how much you can charge.”
- Scott K. Edinger
Topics Covered:
01:24 - How Scott found himself in pricing
02:48 - A backstory of how he started in HR and landed in pricing
03:09 - A deep dive into why selling and leadership are closely related
08:06 - How to sell at a higher margin without too much discounting
10:15 - Questions to ask your team to uncover if they're bringing value to people's sales experience
12:11 - Making customers find aha moments in your offer/service
13:49 - How you make people choose you over competing options
15:16 - Building trust and what it takes to build it at this point in time
17:26 - Discussing about a faulty assumption on the idea of 'land and expand'
19:47 - Sales experience in relation to customer experience in the concept of 'land and expand'
22:08 - What drives expansion
23:51 - The 3 Cs of inspiring and communicating
25:31 - Scott's response to Mark's comment: Here's what I love about those three C's. They ought to be in chapter one
26:04 - Scott giving his best pricing advice
Key Takeaways:
"The sales experience is the first mile of the customer experience highway. And if it's not good, people get off at exit one and have a customer experience someplace else." - Scott K. Edinger
"If you want to sell at a higher margin, sell at greater margins or sell expanded solutions, then your ability to help customers to think differently, to help them to see problems that they hadn't anticipated or solutions that they hadn't considered, that part of the sales experience has to be a priority. That can become a differentiator." - Scott K. Edinger
"One of the things that I think really drives it [expansion] is if you recognize the sales execution in your business; sales becomes the execution of your strategy." - Scott K. Edinger
People/Resources Mentioned:
- The Growth Leader: Strategies to Drive the Top and Bottom Lines by Scott K. Edinger: https://www.amazon.com/Growth-Leader-Strategies-Drive-Bottom/dp/1799746208
- Sell Is Human: The Surprising Truth About Moving Others by Daniel H. Pink: https://www.amazon.com/Sell-Human-Surprising-Moving-Others/dp/1594631905
- Rethinking the Sales Force: Redefining Selling to Create and Capture Customer Value by Neil Rackham: https://www.amazon.com/Rethinking-Sales-Force-Redefining-Customer/dp/0071342532
- McKinsey: https://www.mckinsey.com
- Gartner Research: https://www.gartner.com/en/products
Connect with Scott K. Edinger:
- Website: https://www.scottedinger.com/
- LinkedIn: https://www.linkedin.com/in/scott-edinger/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 21, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/learning-from-iphone-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Hearts from the Impact Pricing card deck.
We often think about, what is value? And we think of value-based pricing, it's what's a customer or buyer willing to pay. And so, their willingness to pay has everything to do with how they perceive the value of our product. So, what is that value?
Well, it turns out nobody actually wants to buy your product. What they really want to buy are solutions to their problems. And so, how do we think about that? If we want to think about value, let's start by thinking about what's the problem, or problems, our buyers are really facing.
When we deeply understand that and we can articulate that back to the buyer, oftentimes, they can't articulate it, we build great relationships. We resonate with them. And then we can start talking, hey, if you solve this problem, what kind of results might you expect?
And when they can articulate those results and we put them in numerical format, some kind of quantity, then we can usually use business acumen in a B2B space to say, great, here's how much additional profit that would generate for you. Or even better than that, ask them, how much additional profit do we think that would generate for you? And maybe we hold their hand while they do the math.
But regardless, the point of this whole meme is that value always comes back to, my buyer has a problem, they want to solve the problem, and what's the result they're trying to achieve when they solve this problem.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value.
In this episode, Steven delves into a report that includes research analysis on the Net Revenue Retention growth of various industries. The report explores the impact of factors such as organizational design, package architecture, pricing metrics, among others. Additionally, it highlights the role of churn, customer success, and a dedicated team in driving this growth.
Why you have to check out today’s podcast:
- Gain important insights when it comes to Net Revenue Retention [NRR] performance growth for different industries based from a research report
- Understand how a company's organizational design contributes to a low or high Net Revenue Retention [NRR]
- Learn how churn, customer success, and dedicated team greatly affects your Net Revenue Retention
"You need to have two pricing metrics so that you can grow in package. So, some form of usage-based pricing is going to be absolutely critical to a successful NRR growth."
- Steven Forth
Topics Covered:
01:55 - What drives Ibbaka and PeakSpan to work together and come out with a report that gives insights to the pricing industry
06:01 - Why not include price increase when considering net revenue retention [NRR]
09:25 - Differentiating upsell from cross-sell
10:58 - Two reasons why NRR by API is high
15:07 - An explanation on what those chart and numbers mean on page 29 of the report
18:10 - Explanation to Mark's observation on the package architecture with one data showing huge NRR
20:48 - The meaning behind having independent modules but low NRR [in reference to the two sections in the report]
23:04 - Steven's response to Mark's suggestion of redoing the chart [good, better, best version]
26:17 - Touching on the different pricing metrics for AI [ what he says about pricing based on input/output tokens]
28:50 - Pricing a solution and a platform [case in point: Zoom]
33:23 - Explanation to Mark's question in reference to page 39 of the report about Pricing Metrics for API Integrators: Are APIs supposed to be a pricing metric?
35:10 - Two important points that these data report generates [also touching on churn, customer success, and dedicated team and how it affects NRR]
40:36 - Steven's best pricing advice
Key Takeaways:
"If you've designed your packaging and pricing so that you don't have growth in package, don't have upsell, and don't have cross sell, then you know in advance that the net revenue retention is going to be less than a hundred percent because there is always going to be some churn." - Steven Forth
"API as a pricing metric is associated with high NRR performance. Why is that? And I think the answer is because of the verticals where it's used." - Steven Forth
"There's lots of companies that are not very good at cross-sell. So the fact that, if you're using independent modules and you have low NRR, that suggests that you're not doing a very good job with cross-sell." - Steven Forth
"When you really get into this data, even in the verticals that are generally having low net revenue retention, there are a few companies that have high net revenue retention. So you can't just blame it on your vertical because there are probably some of your competitors in your vertical that do have maybe not 130, but 110 to 120% net revenue retention." - Steven Forth
"The companies that have the best NRR performance are the companies that have dedicated NRR teams." - Steven Forth
Resources/People Mentioned:
- PeakSpan: https://www.peakspancapital.com
- Webex: https://www.webex.com
- Zoom: https://zoom.us
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 14, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/four-ways-to-grow-a-customer/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Spades from the Impact Pricing card deck.
Of course there's no such thing as a commodity. Well, many salespeople, many business people think they're selling a commodity. And what that really means is that they just have to charge the same price that everybody else charges.
But is that really true? In my view of the world, if you're charging the exact same price, that means you're not adding any value. Why would I buy from you versus somebody else? And in truth, there are ways that you can add value to almost anything.
For example, if you were to go to two different vendors of gold coins online today, you'll find they're not identical prices. But isn't gold a commodity? Well, maybe it's approximately the same price, but there's a difference in price based on the service level of the vendor. Based on something that they're giving above and beyond. Maybe it's free shipping. Maybe it's storage. Maybe it's the niceness of the salespeople.
Regardless of what it is, there's something there that says, Hey, I get to charge a little bit more than my competition because my product, my service, something is better. And what we need to do, even if we're selling a true commodity, something that is physically identical to somebody else's, we can differentiate it through other means. So, we should always be focused on the fact that we are not selling a commodity.
In fact, my view of the world is, if you're claiming that you sell a commodity, then we don't need you as a salesperson. And we don't need you as a product manager. Because pretty much everybody has the same thing, why would we need you to help us?
So, accept that fact and drive hard, what's different? Where's your differentiation? What can you do that's better so that you can charge a higher price?
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Brooks Hamilton is a principal at Hamilton AI Strategy Advisors, specializing in strategy consulting, product management, program management, cross-functional team leadership, and go-to-market strategy.
In this episode, Brooks discusses AI Pricing capabilities and upcoming opportunities that benefit pricing optimization, revenue and data management, and AI's ability to enhance productivity in various areas of your business.
Why you have to check out today’s podcast:
- Learn the basics of getting started with AI, especially if you are new to using it
- Find out how AI can help pricing people in price optimization, management revenue, and data management
- Learn about AI advancements in email response features, the challenges of using it, and the implications of not implementing it
"I would really look at the opportunity in front of them to delight their customers and delight their employees by simplifying the Excel file management problem that we all wrestle with."
- Brooks Hamilton
Topics Covered:
01:30 - What you can expect from this conversation
02:15 - How is AI pricing helping businesses with no big data sets?
05:32 - The ease of consolidation of customers' names with AI Pricing
07:46 - How much is there to learn with AI pricing?
09:31 - Getting started with AI and navigating it
12:13 - Addressing the issue of AI failing to generate your unique voice [ in the case of writing pricing blogs]
15:06 - Could AI potentially offer a precise solution for the problem presented? [in reference to Mark’s case]
16:53 - Going deeper into the analogy that Mark provided regarding the AI’s capability to provide a solution
18:55 - AI’s capability advancement in terms of pricing
20:43 - Email responses advancement where AI is concerned
22:17 - Two ways to find out your customers’ size in terms of revenue even with limited data
24:16 - Challenges and questions with regards to AI pricing
25:46 - What does Brooks' company, Hamilton AI Strategy Advisors do?
27:07 - Some more challenges in addition to what Mark already mentioned and what could be the implications
27:37 - Brook's advice on how organizations should look at and think about AI
38:33 - Brook's best pricing advice
Key Takeaways:
"In the realm of pricing, certainly things like price optimization, and then more broadly revenue management, especially in a B2B realm, where do I go find these opportunities, have really been the domain of sophisticated analytical and optimization packages." - Brooks Hamilton
"Right now I think that the main opportunities are going to be in data management, data cleanup, and then just trying to make your life as a corporate citizen or somebody who interacts with corporate citizens easier in terms of getting faster and more complete on your email responses. It can be that simple to try to just get more productive." - Brooks Hamilton
"It's one that I would advise them [companies] to not take off looking at it and saying, hey, this is just going to be crypto crap all over again. Because there are some real differences. And as McKinsey has pointed out, if you do not begin this journey, it is going to be very challenging later to catch up because unlike other tech revolutions, the pace of change of this one is rapid." - Brooks Hamilton
People/Resources Mentioned:
- OpenAI: https://openai.com
- Outlook: https://www.microsoft.com/en/microsoft-365/outlook/email-and-calendar-software-microsoft-outlook
- McKinsey: https://www.mckinsey.com/
Connect with Brooks Hamilton:
- Email: brooks.hamilton@strategyadvisors.ai
- LinkedIn: https://www.linkedin.com/in/brooks-hamilton-austin/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on September 7, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/two-ways-to-grow-revenue/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on September 1, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-first-principle-of-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Karan Sood had the privilege of overseeing revenue management for over $6 billion in revenue across a diverse range of industries during the past decade. Throughout this experience, he gained a deep understanding of the critical role that pricing plays in business success.
In this episode, Karan explains how to effectively map out touch points within organizations to help individuals understand the significant impact pricing can have on business success.
Why you have to check out today’s podcast:
- Understand the challenges that come with the pricing role and learn how to strike a balance when interacting with other roles in the company for them to understand pricing's role in business success
- Gain insights on how sales flow through pricing
- Learn how pricing intersects with strategy and marketing
"Map out your pricing touchpoints in marketing, supply chain, finance…everyone! And then figure out how your pricing should operate in the organization."
- Karan Sood
Topics Covered:
01:29 - What led him to pricing and how that internship led him to one job after another
05:46 - Pricing as strategy and marketing
07:40 - Important thoughts on pricing underrepresentation
10:34 - Why there aren't VP of Pricing titles in most organizations
11:34 - The friction role that go with pricing
13:44 - How does pricing relate with sales enablement?
21:53 - What happens when you're mainly pricing and not enabling sales teams
24:56 - Likely reason for sales prevention team existing in the sales enablement team
25:43 - Causes of over-discounting and how not to fall into the trap
28:17 - Karan's best pricing advice
Key Takeaways:
“Pricing sits at the heart of the organization.” - Karan Sood
“It's [pricing] not guesswork, but it's guesswork with a framework in a way that there's no one perfect price.” - Karan Sood
“I don't worry about that price per se anymore because I know with the right leverage with the customer and internally in the organization, I can move that needle.” - Karan Sood
People/Resources Mentioned:
- Philip Kotler: https://www.pkotler.org
- Robert Dolan:https://www.hbs.edu/faculty/Pages/profile.aspx?facId=6449
- Thomas Nagle: https://www.linkedin.com/in/thomas-tom-nagle-2bb2288/
- Yellow Pages: https://www.yellowpages.com
Connect with Karan Sood:
- LinkedIn: https://www.linkedin.com/in/soodkaran/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 25, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/defining-value-based-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Ace of Clubs from the Impact Pricing card deck.
Nobody cares about your product. Let's use an example. Let's pretend that you're in the marketplace for a new car, and you're thinking to yourself, Hey, I could go buy a Tesla or some other electric car, or I could buy a more traditional gas powered car.
And so, are you really focused on what are the features of the electricity, of the batteries? Are you really focused on, Hey, if I buy electric then I have electric. You actually don't care.
Here's what you might care about. You might care about the fact that electric cars, especially Teslas, have amazing acceleration. They come off the line super quickly. You may care about the fact that you're not burning fossil fuels and you're not polluting your city. These are things that you value.
But you know what you don't care about? You don't care about the fact that it's electricity or if it's gas. You care about the things it does for you. How it impacts your life, how it impacts your world, how it impacts your self perception. These are all things you value.
And so, when we're selling a car, are we going to sell, Hey, this is an electric car. Or are we going to sell, Hey, this is really fast. Or, Hey, this really helps the environment, and don't you want to be environmentally conscious.
In the end, buyers buy value. They really don't care about your product.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our Impact Pricing playing cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Robert Ribciuc is the Managing Partner at EBITDA Catalyst. He helped establish, grew, and managed a successful advisory/consulting firm focusing on pricing strategy and analytics, go-to-market optimization, and revenue management for middle-market corporate and private equity portfolio (PE) clients in diverse industry verticals.
In this episode, Robert shares the need to understand the veterinary business as a whole, from the service to the non-service products to come up with the best pricing strategy.
Why you have to check today's podcast:
- Understand how veterinary practice is different from other industries
- Consider the use of good, better, best pricing strategies when dealing with veterinary services and products
- Learn to holistically understand the veterinary business from the two sides -- the service and the non-service aspect to create best pricing strategies
"The hypothetical practice where the veterinarian also acts as the practice manager which the more you go up in size you have multiple practices, and then you get to these corporate entities, they try to avoid that like the plague."
- Robert Ribciuc
Topics Covered:
02:31 - Robert's thoughts on what is said as unreasonable expenses in taking care of pets
07:07 - Understanding the dynamics of the veterinary practice as totally different from other industries
11:49 - How are the bigger veterinary companies leading when it comes to price increase?
14:22 - Payment schemes to consider for veterinary expenses
15:22 - How should veterinarians deal with pricing
17:19 - Staying in the veterinary business for long-term
18:17 - The concept of having a practice manager responsible for pricing, instead of the practice owner [implementing the good, better, best pricing]
22:01 - How to effectively manage pricing for the diverse range of services and products offered by a veterinary practice
27:49 - His definition of business success
Key Takeaways:
"One of the trends we should talk about is adoption or non-adoption of insurance in this space and other types of concepts from pricing like subscription or wellness plans, where instead of having that one time pain that is potentially dramatic and brings you to tears, you have a tiny bit of pain every month, but hopefully short of tears." - Robert Ribciuc
“If you are one of these practices and you're selling a product, you take the case of medication that's being sold. And some of these practices sell some of the medication physically in the practice. And then there are providers like vet source, which is a way to have your online pharmacy that's like your practices ordering portal for your practice customers, that's a pretty significant part of revenue for a practice. And so there are questions over there. How do you get sophisticated with pricing in that space?” - Robert Ribciuc
People/Resources Mentioned:
- Blue Pearl Emergency: https://bluepearlvet.com
- Banfield Pet Hospital: https://www.banfield.com
- Mars: https://www.marsveterinary.com
- General Mills: https://en.wikipedia.org/wiki/General_Mills
- Blue Buffalo: https://bluebuffalo.com
- VHMA: https://www.vhma.org/home
Connect with Robert Ribciuc:
- LinkedIn: https://www.linkedin.com/in/ribciuc/
- Email: robert@ebitdacatalyst.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This one is the Ace of Diamonds from the Impact Pricing card deck.
Value-based pricing truly is a never ending journey. Think about what it means. It means we're going to charge what a customer is willing to pay. But you can't read your customer's mind. You have no idea exactly how much someone's willing to pay you. And so we can make decisions inside our company to get us closer and closer to that number.
We can do experiments. We can do interviews. We can, by the way, sell more value, communicate value better, increase that willingness to pay. And so everything we do should be focused on how much is that customer willing to pay. But because we can't read their mind, we can't be perfect. And if we can't be perfect, that means we can always get better.
My recommendation is don't pretend that we have value-based pricing done. Consider value-based pricing as an attitude, it's the goal. It's the journey that we're on to get better and better at capturing more of the value we deliver to our customers.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our Impact Pricing cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Ace of Hearts from the Impact Pricing card deck.
It is true, the single most profitable pricing decision any company can make is to adopt value-based pricing. Now value-based pricing is hard to do, but it has a really simple meaning. It means charge what your customers are willing to pay.
If you had the ability to read your customer's mind and you knew exactly the most that they would pay for your product, then you could charge that and you'd win the deal. And you couldn't have won it at a higher price. And if you charged a lower price, then you left money on the table. So that's absolutely the optimal approach.
Of course, if our salespeople do a better job at communicating value, then we could increase how much our customers are willing to pay. So this isn't the whole deal, but understand the concept is, we want to be able to charge what our customers are willing to pay. And to do that, it's really an attitude inside our company.
We should be thinking instead of, hey, we charge based on our costs and we charge based on our time. We charge based on the fact that prices or costs went up. All of these things can impact how much a customer is willing to pay, but the single thing that should be driving our pricing decisions is thinking really hard about the willingness to pay of our buyers.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ronald J. Baker is the founder of VeraSage Institute, a reformed CPA and cost accountant who has changed his mind on the value of timesheets and cost accounting. His quest is to bury the billable hour and timesheets.
He is also a radio talk-show Host, The Soul of Enterprise: Business in the Knowledge Economy heard on www.voiceamerica.com.
In this episode, Ron let us know why he changed his mind when it comes to the use of timesheets when setting up pricing. Hear his reasoning about why you should also get rid of timesheets. He offers profound insights, as well as examples and explanations, into how certain pricing value and cost models are appropriate for particular industries.
Why you have to check out today’s podcast:
- Learn why many companies in accounting and the automobile industry are switching to subscription pricing
- Discover how timesheets cause leaders to focus on the wrong metrics, especially in pricing and value setting
- No timesheets? Is it possible?
“Even if you’re a solo entrepreneur, have somebody else help you with pricing because it will put a spine in you and you won’t give yourself away.”
– Ronald J. Baker
Topics Covered:
02:44 – Talking about four defenses for timesheets in relation to Pricing
04:41 – Taking into consideration the Cost of Goods Sold in setting the price
07:22 – Difference between a metric and measurement type of cost allocations
09:09 – Opportunity Cost and Sunk Cost
10:39 – Is time really considered in setting up pricing?
14:31 – Project management as a way of making better decisions in the future
15:47 – The best advantage of niching your expertise on
18:31 – The start of subscription pricing in the accounting world
21:30 – Insurance classified as subscription pricing
24:08 – What’s the best thing about hiring an accounting firm rather than accounting staff for your business
27:48 – His thoughts on cars leaning towards a subscription model
29:50 – Ron’s pricing advice
Key Takeaways:
“Keep in mind that I don’t need to see timesheets to know your firm’s costs. I need to know, I need to see your GL, your income statement and I need to know what your labor and all of that is. I’d much rather track revenue per person or labor cost per person, profit per person in a professional firm because that’s a true measurement.” – Ron Baker
“Even if they’re just starting out as a sole solo. Don’t have any employees. I still think they can put a price on things consistent with their opportunity cost and what they want, willingness to accept and function fine, and this is an integral part of this, as long as they step back after the job is completed and do an after-action review and learn from it.” – Ron Baker
“If you’re niched, if you specialize, it’s much easier to know what something’s going to take once you build up some experience.” – Ron Baker
“A subscription model is a way to lock customers in for life. So in value pricing to Oh you’re pricing, not the customer. And this is the subtle difference, but bear with me, you’re pricing the relationship and you're pricing the portfolio because you’re looking at it as a portfolio rather than a project or just a customer. You’re actually looking at the entire portfolio.” – Ron Baker
“We’re too busy. I think we confuse being busy with being effective and being profitable. And I’ll see a correlation there.” – Ron Baker
People/Resources Mentioned:
- Bain & Company: https://www.bain.com/
- McKinsey and Company: https://www.mckinsey.com/
- Porsche: https://en.wikipedia.org/wiki/Porsche
- Canvas + Fair: https://drivecanvas.com/
- Ed Kless: https://www.linkedin.com/in/edkless
- TSOE Episode #200: Interview with Reginald Lee: https://www.thesoulofenterprise.com/tsoe/lee2
- Lies, Damned Lies, and Cost Accounting: https://www.amazon.com/Lies-Damned-Cost-Accounting-Management/dp/163157065X
Connect With Ron Baker:
- VeraSage Institute: https://verasage.com/
- LinkedIn: https://www.linkedin.com/in/ronbaker1
- Twitter: https://twitter.com/RonaldBaker
- Email: ron@verasage.com
- The Soul of Enterprise: https://www.thesoulofenterprise.com/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Ace of Spades from the Impact Pricing card deck.
First, companies really do exist to create value for customers.
Think about what you do as a business. Everything you do is to get a customer to pay you money. And the only reason a customer would ever pay you money is if you are delivering more value to them than they're receiving. And so, our entire company needs to be focused on how do we create more value for customers? How do we deliver more value? How do we communicate the value?
But we spend all this time creating, communicating value, pricing is the one thing that we do that captures the value that we're able to create and communicate. So, when a buyer chooses to buy our product, they pay the price that we're asking, and that happens to be the transaction value.
That's how we capture the value of what we deliver to our customers.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on August 17, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pros-and-cons-of-price-variance/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
With a decade of experience as an author, speaker, coach, and trainer, Carole Mahoney helps entrepreneurs, founders, and salespeople grow their businesses with a collaborative and science-based sales formula.
In this episode, Carole shares how to make an engaging and collaborative sales conversation that makes your potential buyers feel valued and heard. In doing so, you transform your sales conversations into positive and fruitful interactions.
What you will learn from this episode:
- Learn about this exercise called 'Questions and Periods Game', how to go about it and how it works with your clients
- Discover the step-by-step process of doing the 'Questions and Periods Game' through a role play demonstration of Carole and Mark
- Find out the essential principles you need to know about the art of selling
"Selling isn't something we do to other people. It's something we do with them. And I think that's a fundamental shift that we need to start making in sales."
- Carole Mahoney
Topics Covered:
01:17 - Synopsis of her book 'Buyer First'
03:34 - The best way to look at sales
06:03 - Carole coaching Mark on sales
11:57 - A sales conversation role play between Mark and Carole
16:05 -What is the 'Question and Periods Game' that she used to throw phenomenal questions at Mark?
20:30 - How to do the sales call without having to 'sell you' but to 'help you'
22:55 - Carole's valuable thoughts on Mark's sales technique
26:18 - How to handle a reply to a client's question at the end of the sales call, 'What do you think the next step should be'?
27:15 - What you should not fail to ask towards the end of the sales conversation
Key Takeaways:
"Selling isn't something we do to other people. It's something we do with them. And I think that's a fundamental shift that we need to start making in sales." - Carole Mahoney
"The more you drill down into a specific answer, the more you make them think and the more they start to wonder, maybe I don't know the answer to that. And then you find the opportunity to be able to offer an insight to them when you find out what insight matters most to them." - Carole Mahoney
"When we talk about what we think, dopamine gets released in our brain. And so dopamine is that pleasure center. Like, we want more of that. That's why so many of us tend to get into talking about what we know instead of asking more questions. If we can get our buyers to talk more than we do, they're getting the dopamine released in their brains and they feel good about the conversation." - Carole Mahoney
"Knowing who else can say no or who else can say yes and who else is going to be impacted by this [decision] is a critical question to ask towards the end of a call for your next step." - Carole Mahoney
People/Resources Mentioned:
- Buyer First: Grow Your Business with Collaborative Selling by Carole Mahoney: https://carolemahoney.com/books/buyerfirstbook/
Connect with Carole Mahoney:
- LinkedIn: https://www.linkedin.com/in/carolemahoney/
- Website: https://www.unboundgrowth.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 10, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/defining-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on August 3, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/which-business-do-you-want/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
David Falzani is a CEO at Polaris Associates and a Professor at Nottingham University.
In this episode, David discusses the strategy for driving higher pricing by understanding the value delivered to customers. He also dispels the myths surrounding the notion that high pricing lowers sales, sharing the results of experiments conducted with various companies that prove otherwise.
What you will learn from this episode:
- Learn how to achieve profitability without constantly chasing pricing
- Find out the underlying reasons for underpricing and dispel common misconceptions about the negative impact of higher prices on sales
- Discover experiments where doubling your price yields significantly higher profitability compared to low pricing strategies
"Think dynamically about price and do it often."
- David Falzani
Topics Covered:
01:42 - Expounding on 'sustainable wealth creation'
02:54 - What caught his interest in pricing
04:36 - Three reasons why underpricing exist
06:48 - Emotional baggage and fear that comes with underpricing
08:13 - Frequency of price changes and increase
09:37 - 12 exercise the book suggests you can do to revisit your pricing strategies
12:13 - What makes companies lose confidence in pricing higher
14:37 - How to be profitable without chasing price all the time
17:01 - A case of a perfect example of understanding the relationship of pricing and customer value: Apple versus Android
18:21 - Why double your price? [And experiment you can do]
22:59 - Light double your price [an experiment for the more risk -averse]
24:29 - Looking at the numbers in terms of feasibility of price increase
26:57 - Busting myths about pricing higher
29:24 - David's best pricing advice
Key Takeaways:
"The frequency of revisiting your pricing decisions. Every time you revisit it, do something different, use a different piece of analysis." - David Falzani
"Don't just go and revisit the same comparison to competitors or if you are using cost- plus, which I hope you're not. Think about the frequency at which you are reviewing those pricing decisions." - David Falzani
"The more you look at pricing, the more questions that are raised, the more you start to educate yourself about your own customers, your clients, the market, competitors, and all those dynamics." - David Falzani
People/Resources Mentioned:
- Thinking, Fast and Slow by Daniel Kahneman: https://www.amazon/Thinking-Fast-Slow-Daniel-Kahneman/dp/0374533555
Connect with David Falzani:
- LinkedIn: https://uk.linkedin.com/in/davidfalzani
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 27, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-usage-and-value-metrics/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Joker 2 from the Selling Value card deck.
Almost always when we're dealing with B2B customers, B2B business, value can be measured in additional profit. And that's one of the things I love about B2B business and pricing, is because we know our price has to be related to how much additional profit will they make when they use our product, or when they use our product relative to a competitor's product.
But it turns out, sometimes, buyers inside our customers don't really care about profit. Imagine that you're selling a piece of medical equipment and you're talking to a doctor in a big hospital. Now the doctor actually doesn't care how much additional profit you're going to make the hospital. There's an administrator someplace who cares a lot about how much additional profit you're going to make the hospital. And so, we still need to understand the profit side of this conversation.
But from that doctor's perspective, they couldn't care less about profit. What do they care about? They care about the quality of the care for the patient. They care about efficacy rates. They care about how long the procedure might take. Things that really affect their world and things that matter to them. What we want to be able to do then, is as we go through our value conversations with a doctor, put value in the perspective of what that doctor cares about.
So, it's not always profit, a lot of times it is, but we need to understand what each buyer truly cares about and talk about value from that perspective.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Sebastian Baier is the founder of Buynomics, an AI for ultimate customer-centric RGM decisions- in one SaaS solution.
In this episode, Sebastian discusses how Buynomics' AI utilizes vast amounts of consumer behavior data to generate virtual customers, enabling the implementation of optimal pricing strategies.
What you will learn from this episode:
- Learn how to create a customer simulation to identify the key factors that drive the value of a product and develop effective pricing strategies for optimal results
- Discover how to create a customer model for B2B, even when limited data is available
- Learn how to effectively analyze and interpret customer data in terms of distribution rather than segment
"Collect data however ugly it might look."
- Sebastian Baier
Topics Covered:
01:12 - What got him into pricing
02:47 - Buynomics and what it does
04:41 - Understanding customer simulation and segmentation in the way Buynomics work
08:03 - Talking about segments and distribution densities
12:24 - How Buynomics helps provide what-if analyses for pricing strategies
13:29 - Creating customer models for B2B when there are not enough data available
17:28 - Sebastian's thoughts on Mark's suggested solution for B2C clients
19:11 - Salesperson as a value driver for B2B customer simulation
19:48 - Sebastian's best pricing advice
Key Takeaways:
"Even if you don't have great data [with B2B], you'll use the data because you have to have a model of the world." - Sebastian Baier
“To make statistics work, you have to have a certain number of customers.” - Sebastian Baier
"It's really very valuable just to start collecting the data, and look at them as you would as a consultant.” - Sebastian Baier
People/Resources Mentioned:
- Slack: https://slack.com/
- Zoom: https://zoom.us/
- Vodafone: https://www.vodafone.com/
Connect with Sebastian Baier:
- LinkedIn: https://www.linkedin.com/in/sebastian-baier
- Email: sebastianbaier@buynomics.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 20, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-do-they-buy/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Joker 1 from the Selling Value card deck.
You heard earlier that there are really three types of buyer's value journeys. Those happen to be analytical, relationship, and trust.
In the analytical relationship, there's typically a lower level person who's doing a lot of side by side comparison between your product and a competitor's product, and our buyers are by far the most price sensitive in that situation.
Or we could go all the way to the trust journey, and that is where they come to us. They ask us, "Hey, what do you do? How do you help us solve our problems?" They never even look at a competitive alternative. And in that situation, they're the least price sensitive.
The relationship journey is the one in the middle, where people would come to us and say, "Hey, how do you help us solve our problem?" We guide them. They build a great relationship. They really like us. And then they say, "Yeah, but we have to go look at competitive alternatives." We've built up enough goodwill and probably tweaked their thinking that we have the competitive advantage. And so, they're not going to be as price sensitive as they would be if they were in a relationship journey. But they're still more price sensitive than it was just a trust journey.
So, you could think of these three different journeys (the analytical, relationship, and trust) is how our customers go learn about the value of our products. But at the same time, it's how price sensitive are they going to be when it's time to negotiate the price. It's really important that we understand which journey each buyer is on.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ian Campbell is the author of Wall Street Journal Best Seller "The Value Sale". As Chief Executive Officer of Nucleus Research he is responsible for the company’s investigative research approach, product set, and overall corporate direction. He is a recognized expert on the return on investment (ROI) and total cost of ownership (TCO) analysis of technology and has written and presented extensively on a range of organizational topics and the importance of matching technology to business organizational objectives.
In this episode, Ian shares how you can create optimal pricing by understanding how customers use your product and find value in them.
What you will learn from this episode:
- Learn how to quantify a product's value in measurable terms
- Find out the three value propositions you can derive from when helping people find and understand their product's value
- Discover how to restructure your conversations to help people recognize the value you offer and you get empowered to price that value
“Look at the customer value, how is the customer achieving value from your product and price according to that.”
- Ian Campbell
Topics Covered:
01:42 - How he got into pricing
02:23 - What Nucleus Research is all about
03:26 - Understanding value with how customers use the product rather than vendor claims
05:20 - Defining Value
06:48 - The challenge with quantifying ROI with non-monetary value [customers' happiness]
09:00 - Thoughts on Mark's statement about B2B being more cognizant of value they want to receive
10:05 - Translating 'happier employees' into quantifiable terms
11:19 - Selling risk and who bears the most burden in dealing with security threats
15:32 - What's it like selling for emotional reasons
19:14 - How emotional decisions relate to Danny Kahneman's decision-making theories
20:29 - Why he uses the three-year horizon [but what if a client insist on using a 5-year time frame]
24:00 - Why there are only three value propositions you can derive from
26:15 - Helping people [existing and new customers] find value in your product
28:22 - How to structure your conversation that people understands and find value in your product
29:50 - Ian’s pricing advice
Key Takeaways:
"Technology is around delivering value, not necessarily what's the best, but what's the best for you and understanding that." - Ian Campbell
"When you talk about value, we look at value in four different categories, and there are value categories that are for instance happier employees. And that's not something I can necessarily quantify, but for a customer and for a company, that could be something very, very valuable for them and that could be their objective." - Ian Campbell
"Today, more than ever, it's important to draw a link between what you sell and how you deliver bottom line benefits. Otherwise, you're going to have a tougher time beating out not just your competitors, but all of the other projects they could be doing." - Ian Campbell
"If you're selling with value, realize that value is a tool to help you sell. Value is not a consulting project, don't turn it into a consulting project. Turn it into a tool that helps you close the deal." - Ian Campbell
People/Resources Mentioned:
- Daniel Kahneman: https://en.wikipedia.org/wiki/Daniel_Kahnemanhttps://en.wikipedia.org/wiki/Daniel_Kahneman
- Salesforce: https://www.salesforce.com
- Gartner: https://www.gartner.com/enhttps://www.gartner.com/e
- Forrester: https://www.forrester.com/boldhttps://www.forrester.com/bold
Connect with Ian Campbell:
- LinkedIn: https://www.linkedin.com/in/iancampbellnucleusresearch/
- Email: ian@nucleusresearch.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 13, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/its-too-expensive/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 2 of Diamonds from the Selling Value card deck.
I'm often asked who should own pricing, and one of the departments that often comes up is finance. And of course, I'm not a huge fan of finance owning pricing. And the biggest reason is finance doesn't truly understand the value of our products. Usually that's going to be someone in product management, product marketing, or even sales, which I'm not a fan of them owning pricing either.
However, finance so much wants to be involved with pricing. It's so crucial to their projections. It's so crucial to company growth, which they care a lot about. They really want to be involved with pricing, even though they don't understand value. So, how do we get them involved in pricing?
That's pretty simple. Finance has a bunch of quant people. They have access to every piece of data inside the entire company, and they have the desire to make us or help us do better in our pricing. And so, let's figure out what are the KPIs, the key performance indicators, that we really want to track inside our company. And let's ask finance to help track those, keep us on track, make sure that we don't see any anomalies. We know what the trends are.
Finance is a fantastic department to help us manage our KPIs.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 2 of Clubs from the Selling Value card deck.
Salespeople are going to use every single tool they have available to them. Absolutely, they're going to use value selling if we've taught them how, and they understand, and they're doing a great job. But even if they're using value selling, it's very easy for them to offer discounts. And there's this attitude or belief that offering discounts helps close a deal faster.
And maybe it does. Maybe when a customer or a buyer asks you for a discount, it takes longer to say no and explain why. And we could have just said yes and close the deal and we're done.
Wouldn't that be great if it worked that way? But here's the key. Every dollar that we discount comes straight off of our profit.
We still have to cover all of our costs, and so our margin just got shrunk by more than our revenue did on a percentage basis. So, if we want our salespeople to not rely on price, we have to make it painful for salespeople to offer discounts.
How do you do that? Create a compensation plan that as they give bigger discounts, the percentage or the size of their deal goes down faster than the revenue goes down because salespeople are incentivized to close deals as fast as possible. And we want to make sure they're incentivized to close deals quickly at the highest possible price.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 2 of Hearts from the Selling Value card deck.
When you get an RFP, you have to decide, are you going to bid or not. Believe it or not, that's actually a decision you get to make. You do not have to respond to every RFP that comes through. And my advice, if you are not involved in the creation of the RFP, or at the very least, if you cannot have conversations with the decision makers or executives of the group who created that RFP, you have a very low chance of winning.
And so, the time and energy that you spend replying to the RFP makes you feel like you're doing work, but odds are really good you're not going to win that deal. There's somebody else that has already built a relationship with the client, understands exactly what the client wants, is able to create a response to that RFP that fits them almost perfectly. They've built the rapport so the client's going to give them the benefit of the doubt no matter what.
If you're going in blind to an RFP, you're probably not going to win.
Let's test that. From here on out, every time you respond to an RFP, just keep track. Did I help write this? Do I know the leaders? Do I get conversations with the executives? And if the answers are no, and you go ahead and bid, see how many of those you actually win. And I will bet you the percentage of those is so low you realize it just isn't worth your time to bid RFPs where you're not already involved.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value.
In this episode, Steven discusses the challenges of pricing AI, primarily due to the limited availability of data. He emphasizes the importance of shortening the time required to build value models in order to easily establish pricing.
What you will learn from this episode:
- Discover the complaints and challenges associated with pricing AI
- Enhance transparency in establishing the price point with creating value models
- Find out the most recent advancements in AI pricing concerning language models and software, which greatly enhance productivity
"Once you have a good value model, coming up with pricing is maybe not trivial but it's certainly much easier."
- Steven Forth
Topics Covered:
01:15 - Discussing complaints about AI through the Value Models
07:57 - Steven's added thoughts to Mark's suggested solution to achieve pricing transparency [limitations in creating value models]
11:43 - The need for more trainings for language models used in pricing
14:25 - What is Copilot by Microsoft and what it is capable of doing that can help salespeople
17:04 - How is Copilot might disrupt the market especially Google Workspace user
17:50 - Survey of people's willingness to pay $30 a user for Copilot [and whose group is more willing to pay more]
22:20 - How were the users segmented, are they all Copilot users, and finding out people's reaction to AI
23:37 - The amazing capabilities of these two AIs
24:57 - What could happen if Mark Stiving will use AI to write his fourth book [The need for great prompt engineering]
28:12 - How are AIs going to be priced
29:59 - Microsoft Copilot as a 'Will I' question
Key Takeaways:
"If you can build a value model and validate a value model, then you can fairly easily, I believe, derive pricing from the value model." - Steven Forth
"We should be able to customize a language model based on our training and integrate mathematical AI from a place such as Wolfram/Alpha to greatly scale up our ability to build value models so that we could legitimately do a thousand a year or so." - Steven Forth
Resources/People Mentioned:
- Craig Zawada: https://impactpricing.com/podcast/ep95-defining-no-touch-and-self-serve-pricing-with-craig-zawada/
- PROS: https://pros.com/
- Vendavo: https://www.vendavo.com/
- Zilliant: https://www.zilliant.com/
- McKinsey: https://www.mckinsey.com/
- Wolfram/Alpha: https://www.wolframalpha.com/
- iGenius: https://www.igenius.ai/
- Hugging Face: https://huggingface.co/
- OpenAI: https://openai.com/
- Figma: https://www.figma.com/
- Notion: https://www.notion.so/product
Connect with Steven Forth:
- Email: steven@ibbaka.com
- LinkedIn: https://www.linkedin.com/in/stevenforth/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 6, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/next-book-title/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 2 of Spades from the Selling Value card deck.
You've heard me talk about value conversations before, where value conversations are really the conversation we have with a customer or potential buyer, so they can determine how much additional profit they're going to make when they use your product. And that's awesome when they're only making a 'Will I' decision. Am I going to buy your product or not? Am I going to buy a product in your category or not?
But what happens when they say, "Am I going to buy your product or somebody else's product?" Now what we want to do is understand our differentiation because value in that case comes from the price of our competitor's product plus the value of our differentiation. We need to determine the value of our differentiation. Or said better, we need our customers or buyers to determine the value of our differentiation.
And that's what a relative value conversation is. We want to see what's our differentiation relative to our competitors, and then go through the exact same steps we would with a normal value conversation to help the buyer determine if you have this problem that this differentiator solves, what's the result you might expect? How much additional value do you think you would get? And now we're putting a dollar value on the differentiation.
This is powerful when you're competing.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Sebastian Wrobel is an energetic and passionate professional leader, helping companies achieve value and pricing excellence. Pushing digital transformation into lasting integration. Experienced in working closely with the C-suite and senior stakeholders to elaborate and drive major profit & growth optimisation plans. Building high performing teams by leveraging a collaborative and data driven leadership approach.
In this episode, Sebastian provides valuable insights on how to create the perfect title for a pricing book. The goal of which is to capture the attention of individuals driving pricing within a company.
What you will learn from this episode:
- Understand the discovery process of value generation to come up with best pricing strategies
- Gain a deep understanding about value and pricing as Mark and Sebastian carefully examine various book titles on the subject
- Understand the discovery process around value and pricing
"Start your [pricing] journey wherever you are, and accelerate on your journey wherever you are. The investment is paying off, always."
- Sebastian Wrobel
Topics Covered:
01:17 - A quick fun story on how he got lost for two days in the mountains
01:55 - What got him into pricing?
03:02 - Valugram as a company -- what it does
07:30 - What most companies are missing out on in regard to value and pricing
08:04 - Understanding the 'discovery process'
11:06 - Thoughts on value and pricing as understood by experts in their own fields
13:31 - Gaining business confidence
15:59 - Challenging the idea behind this title for a book: The Secret to Skyrocketing Profit
18:45 - Feedback on this title - Leveraging Value: CEO's Blueprint for Driving Profits
22:40 - Will addressing CEOs in the book title encapsulates all other people who are driving pricing other than the CEOs?
24:53 - An analysis of the title - The Power of Value: The CEO's Secret Weapon to Driving Profits
30:57 - Sebastian's pricing advice
31:25 - How to connect with Sebastian
Key Takeaways:
“Value selling is not applicable to all products. Neither all client segments. Where it is applicable, you should do it properly.” - Sebastian Wrobel
"Gartner study shared that this is the critical aspect about winning deals, enabling buyers to make a decision in the right one." - Sebastian Wrobel
"As pricing people, we tend to think in profits. But for me, leveraging value is more. Not only profit, but it's about driving revenue, top line growth, and also customer loyalty." - Sebastian Wrobel
Connect with Sebastian Wrobel:
- LinkedIn: https://www.linkedin.com/in/sebastian-w/
- Website: https://pricingworks.io/
- Website: https://www.valugram.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 29, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/right-or-effective/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 3 of Diamonds from the Selling Value card deck.
The question now, as we're doing our prospecting, is to say which prospects will get the most value. We've talked in the last few weeks about finding prospects who realize they have a problem, finding prospects who we know have the problem, finding prospects who prioritize solving the problem. Now what we're saying is, let's find the prospects who get the most value out of solving that problem.
When we think about it, if a customer gets a ton of value from solving the problem, they're much more likely to say yes and move forward than somebody who gets a small amount of value from solving the problem.
So, one way to think about that, as a pricing expert, I'll give you a quick hint. I work with software companies, I work with hardware companies. And sure, I love working with all of them. And I could work with software companies because there's great flexibility in the way they create their products or stick features into product options, and I love that.
But when you think about a hardware company, the margins for hardware companies are so small and they have real hard costs. So, if we could improve their pricing by just a little bit, the percent profitability goes up dramatically. And so I would say, from my perspective, helping hardware companies, they have higher value in solving a pricing problem than a software company does.
How does it work in your business? Which of your customers get the most value out of solving the problem that you solve.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Kiran Gange founded RapidPricer and is currently working on automated pricing and promotions for retailers using image processing, spectral images, IOT data and artificial Intelligence.
In this episode, Kiran shares a dynamic pricing strategy for retailers that increases profits while providing greater value to customers.
What you will learn from this episode:
- Develop a dynamic pricing strategy that prioritizes maintaining long-term customer trust rather than solely focusing on profit
- Discover opportunities for retailers to implement dynamic pricing strategies
- Learn about a pricing strategy that reduces food wastage in the retail industry
"Take a look at your data to understand how customers are reacting to price changes."
- Kiran Gange
Topics Covered:
01:16 - What inspired him to write the book 'The Expert Guide to Retail Pricing'
02:55 - The reason for suboptimal pricing in most retail companies he works with
06:13 - Pricing in B2B versus B2C as it relates to value associated with the product or service
07:51 - Explaining about the lagged reaction between the value and the price of the product
09:22 - Illustrating the work they do at RapidPricer when it comes to dynamic pricing
13:16 - What helps customers in their decision when choosing stores to buy from
15:05 - Frameworks used and discussed in Kiran's book
16:16 - Identifying products that are profit drivers or traffic drivers
17:45 - Determining individual product elasticity even without changing prices [plus a discussion on category and product elasticity]
20:30 - Seeing opportunities for retailers to do dynamic pricing [Costco having a brilliant customer level analysis]
22:30 - What is the ‘minimum margin rule’
23:26 - How does pricing improve value
24:58 - Kiran’s best pricing advice
Key Takeaways:
"There's so much more value to be achieved in actually selling the product at a lower price than to take this incremental profit and to lose the trust of the customer, which is much more important than your profit in the long run." - Kiran Gange
"It was Jeff Bezos who once said that our elasticity numbers always show that people are inelastic, but that's not true in the long run. You don't want to take prices up and lose the customer's trust. You might as well use a system to build trust while reducing the wastage and increasing the customer satisfaction." - Kiran Gange
"It's not about what the customer is going to see while he is already inside the store, but giving them a fair value where it matters." - Kiran Gange
People/Resources Mentioned:
- The Expert Guide to Retail Pricing by Kiran Grange: https://www.linkedin.com/posts/kirangange_retailpricing-booklaunch
Connect with Kiran Gange:
- Website: https://www.rapidpricer.com/
- LinkedIn: https://www.linkedin.com/in/kirangange/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 22, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/help-whats-bigger-than-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 3 of Clubs from the Selling Value card deck.
It really is easier to sell to someone who's already trying to solve a problem or realizes they have a problem and wants to go solve it.
As I've mentioned previously, as a pricing expert, I believe that almost every company can use my services. Almost every company will benefit dramatically. And yet for me to go knock on a door of a company and say, "Hey, I'm a pricing expert. Would you like some help with your pricing," probably isn't going to be that fruitful because not many companies say, "Hey, I've got a pricing problem."
But as soon as someone says, "Hey, I have a pricing problem." Now, what do they do? They start to look for someone who could possibly solve that problem. Maybe they go to professional pricing society meetings. Maybe they do Google searches on how to find pricing experts. Maybe they look up content and see who the experts are that are writing about it. And then they reach out to me, or to one of my competitors. But the point is, when someone reaches out to me, they've already said to themselves, "Hey, I have a pricing problem. Maybe someone can help me fix it."
So, what about your business? If you know you can solve someone's problem, but they don't either know they have the problem or maybe they just know they have it but they haven't prioritized it. It isn't a big enough deal for them to go say, "Hey, I'm going to go fix that problem now."
It's probably better if we can find a way to find customers who've already prioritized solving your problem.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Robert Edwards specializes in delivering consulting and training for company executives to understand how to optimally price their products and services, monetize their products, maximize value generation and extraction from their product portfolio, and develop their promotions and competitive strategy to increase profit. He holds a PhD in Pricing and Competitive Strategy.
In this episode, Robert shares how to simplify your pricing and effectively communicate its benefits and what value it generates.
What you will learn from this episode:
- Understand how to use price to generate value for your product or services
- Learn to use pricing to attract the customers you want
- Find out about the connection between behavioral economics and pricing
"Creating value for your pricing could be an extra dimension to what we talk about regularly when we're thinking about designing our products and pricing those products."
- Robert Edwards
Topics Covered:
01:25 - How he found his route into pricing
03:15 - Discussing the idea about complicated and simple pricing
04:55 - How Ryanair creates a perception of simple pricing
05:55 - Why make your pricing simple
07:04 - Robert's important thoughts on creating value for your pricing
08:48 - How to add value through pricing
10:42 - LinkedIn as an example in the way of creating value and not just extracting value
14:34 - Thinking in terms of the buyer composition and not just the number of units bought
16:35 - Examples that uses price to attract the customers you want
19:50 - An example that uses pricing as an attention grabber to make all else reasonable
21:09 - A case of sellers focusing on different dimensions in attracting customers and not just pricing
22:57 - How pricing and behavioral economics tie into each other
25:36 - Considering behavioral economics at the beginning rather than at the end of the pricing process
26:18 - Understanding the pricing strategy around rebates
27:01 - Using value-based pricing and having the clarity of message why you're pricing in such a way
Key Takeaways:
"I would definitely recommend in a lot of cases simplifying your prices adds value to the products and service that you're offering because consumers have a really strong preference for this as well." - Robert Edwards
"Behavioral economics is increasingly at the heart of real pricing strategies because you can design a pricing strategy with rational consumers in mind, and it completely does not work the way you intended because consumers have these biases and they're susceptible to framing effects." - Robert Edwards
"A lot of the companies that I speak to, there's an opportunity to add value to their product by using a different pricing metric. And the only reason that pricing metric is really valuable is because of the behavioral biases of the consumers." - Robert Edwards
People / Resources Mentioned:
- Ryanair: https://www.ryanair.com/gb/en
- LinkedIn: https://www.linkedin.com/
- Subway:https://www.subway.com/en-us
Connect with Robert Edwards:
- LinkedIn: https://www.linkedin.com/in/edwardsra/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 15, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-ikea-effect-and-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 3 of Hearts from the Selling Value card deck.
As you're doing your prospecting, you have to decide who you're going to reach out to for the prospecting. And since we know that buyers only buy products to solve problems that they have, what we should be thinking about is, well, where's the community or the marketplace of people that actually have this problem.
So, if I were a moving company and I were trying to find companies that were trying to move, then there may be a way to say, "Hey, I want to go to commercial Realtors because I know commercial Realtors are aware of companies who are moving." And so now I can get commercial Realtors to give me potential names or customer possibilities and that's where I might go prospect.
So, when you think about what your product is, you want to think about, where are the people who actually have the problem that I solve? As I mentioned last week, I'm lucky in that I think all companies have pricing problems. But notice I only talk to companies. I don't talk to consumers because consumers don't have pricing problems. Why would I ever prospect in a pool of consumers?
So, prospect in that pool of buyers who you know have the problem that you can solve.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Karen Chiang is a co-founder and managing partner of Ibbaka, a company that provides software and expertise to enable business growth by optimizing revenue performance through customer value management and talent optimization.
In this episode, Karen discusses the importance of linking your pricing to value and creating pricing packages that accurately reflect the value provided to consumers.
What you will learn from this episode:
- Understand the concept of net dollar retention in relation to your customer base and as a means of measuring your revenue from operations
- Learn how to effectively package your offers by linking value to pricing
- Explore these net dollar retention levers to better understand the value your customers are seeking
"Getting to a value-based mindset is extremely important in order to improve your pricing power."
- Karen Chiang
Topics Covered:
01:19 - How she got her into pricing
02:33 - Defining 'net dollar retention'
04:48 - Pricing as it relates to net dollar retention
09:18 - Linking pricing to value [where churns are concerned]
11:25 - Strategy to keep half a customer rather than losing completely
13:56 - What you must think about in the design of your offer
15:03 - What is product packaging and how it differs from cross-sell or upsell
18:23 - Pricing models and various packaging designs
19:32 - What a cross-sell and upsell are in terms of using the good, better, best
25:12 - Karen's best pricing advice that can impact one's business
26:29 - Net Dollar Retention levers by level of importance
29:04 - Usage based pricing as part of net dollar retention levers
Key Takeaways:
"Pricing has to be linked to value. When you think about it, we want to come up with a pricing method or approach that really tracks the value that is being generated." - Karen Chiang
"There always has to be an understanding of what you are negotiating. What will you give up in your package to make it more feasible for that discount? That's why it's actually a shrinkage in the package itself." - Karen Chiang
"From the get-go and from the design, when we think about the design of our offers, we really have to be more cognizant of, what are the different components that go into that entire offer?" - Karen Chiang
"A good, better, best strategy is one where you try to get people into a certain level, starting with good and you're trying to increase their growth and package by getting them to a better package then a best package." - Karen Chiang
People / Resources Mentioned:
- Steven Forth: https://www.linkedin.com/in/stevenforth
Connect with Karen Chiang:
- LinkedIn: https://www.linkedin.com/in/karen-chiang-2623241/
- Email: karen@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 8, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-based-pricing-is-an-attitude/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 3 of Spades from the Selling Value card deck.
Of course, salespeople, marketing people, we have to do prospecting. The question becomes, who do we look for as prospects to move into our sales funnel?
Well, now that we know that people really have to solve problems, that's the reason they buy our products. The question now is, do we think it's easier to sell to people who already know they have a problem, or to people that we have to convince they have a problem?
You often see advertising like this where people will say, "Hey, come solve this problem." And now what's happening is people are self-selecting and, "Oh, yeah, I've got that problem," so they're trying to find those people. On the other hand, sometimes we have to convince somebody they have a problem.
I find it interesting, I used to run a company a long, long time ago, and my cell phone number still is the phone number that I had when I had that company. And I'll get calls from moving companies that the opening line is, "Hey, I heard that Home Director is moving." Well, it turns out I don't run Home Director. Home Director doesn't exist anymore. Home Director's not moving. But that was a way for them to quickly prospect and find out, "Hey, do I have a company and is the company moving?" Because if the answer that's yes, I've got a problem. And if the answer that's no, then they don't have a problem. So they're trying to figure out relatively quickly, am I somebody that they might be able to sell to or not?
So think about, when you're prospecting, are you prospecting to people who already know they have a problem? Or are you looking for people and then trying to convince them they have a problem?
As a pricing person, I have to tell you, I think every single company has a problem. But it's insane for me to try to go to a company and convince them they have a problem. And it is so much easier for me to work with companies who come to me because they know they have a problem.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jonathan Stark is a former software developer who is on a mission to rid the world of hourly billing. He is the author of Hourly Billing Is Nuts, the host of Ditching Hourly, and writes a daily newsletter on pricing for independent professionals.
In this episode, Jonathan highlights the drawbacks of billing hourly which can reduce your value to just a commodity. Instead, he suggests pricing your services based on the outcome you deliver, thereby providing maximum value to your clients.
What you will learn from this episode:
- Discover the top reasons behind the shift away from hourly billing
- Find out the advantages of choosing outcome-based pricing over hourly billing
- Uncover why positioning your service effectively can have a significant impact on your pricing strategy
"Positioning is critically important for any kind of upward lift on your fees."
- Jonathan Stark
Topics Covered:
01:04 - What got him into pricing
03:35 - The problem with having an hourly rate
06:11 - Pricing uncertainty in the case of a car diagnostic
08:45 - What makes it better charging fixed price upfront
10:33 - Why positioning your service is crucial in pricing
12:59 - What hourly rate appears to be on the label
16:15 - Touching on the 'Experience Economy' [pricing transformation]
19:06 - Formula for value or the maximum price
21:36 - The best reason to not use hourly prices
24:22 - Solving the scope problem with knowing the desired goal
29:21 - Jonathan’s pricing advice
30:38 - How to connect with Jonathan
Key Takeaways:
"If you sell somebody an hour, you cannot make it more efficient. It takes an hour to deliver it. It artificially limits your income." - Jonathan Stark
“The way I do it [on the scope problem], I don’t scope first, I scope last.” - Jonathan Stark
People / Resources Mentioned:
- Alan Weiss: https://alanweiss.com/about-alan-weiss/
- Joseph Pines: https://strategichorizons.com/pine-and-gilmore/joe-pine/
- How to Measure Anything: Finding the Value of Intangibles in Business by Douglas Hubbard: https://www.amazon.com/How-Measure-Anything-Intangibles-Business/dp/1118539273
Connect with Jonathan Stark:
- Website: https://jonathanstark.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 1, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/commit-to-expand/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 4 of Diamonds from the Selling Value card deck.
Wow, walk away from a negotiation, ouch! We're essentially saying, "No, we're not going to negotiate anymore. Take the deal that we've given you or not. Totally up to you." And what happens when we do this?
First off, we're at risk of losing the deal, and that's painful. Especially, if you're in sales and you're paid to get revenue. You've got to meet a quota, your commission comes from that. But it turns out, from a company perspective, oftentimes that's a really smart thing to do.
First off, maybe it's the wrong customer for you. Maybe they need a deep, deep discount because they really don't get the value from your product that they should be getting. Or maybe that they're just negotiating and if you walk away, they come back and say, "Okay, we'll take it." And so, now you've made the sale.
Or, what if you even lose the deal? But because you lost that deal, word gets out, especially to channel partners, other salespeople, we're not willing to accept a deal below this specific price. And now everybody's working harder to sell value and make sure that we get the prices that we actually deserve.
This is hard. But if you end up losing deals because you walk away, my recommendation is track the profitability of the deals if you would've won them at this lower price and compare that to the profitability of the deals you win because you didn't lower the price. And even if you win more deals with lower prices, you probably make less margin and less profit.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Carole Mahoney is an author, speaker, coach, and trainer taking a cognitive approach to sales success.
In this episode, Carole shares how salespeople should initiate a pricing conversation that should be 'Not Be About Me' and quantify the cost of not doing something. That way, buyers make a decision for fear of negative business impact.
What you will learn from this episode:
- Discover a powerful pricing conversation technique that focuses on addressing potential objections and inspires people to take action by tapping into their fears of negative outcomes
- Find out how salespeople add value and uncover urgency for people to make a decision
- Understand why salespeople need to create a ‘dirty laundry list’ and include them in their conversation
"The biggest piece of advice for finding value in a conversation and talking about pricing is to make it a collaborative conversation."
- Carole Mahoney
Topics Covered:
01:30 - How she found a career in pricing
02:20 - Salespeople find it uncomfortable talking about money and pricing matters
03:46 - Pricing conversation that’s more about contrasting and quantifying the cost of doing nothing
06:36 - Not articulating enough the fear of loss
07:49 - Letting buyers articulate the real problem [and getting them to ask these important questions]
08:36 - The Seinfeld-comedy-series inspired technique of pricing conversation
10:16 - Adding value and uncovering urgency
11:30 - Creating a dirty laundry list
14:17 - What makes it advantageous for salespeople to share their laundry list amongst themselves
15:48 - Providing measurable business value while addressing potential negative outcomes
16:59 - Creating a constant reminder to salespeople with a t-shirt that reads: Not About Me
20:43 - Pricing advice that can have the biggest impact in one's business
Key Takeaways:
"If selling is an exchange of value, then the pricing conversation is the proof of value actually exists." - Carole Mahoney
"Ask questions that address why they might say no, not why they might say yes, you need both. You need to be able to draw the contrast." - Carole Mahoney
"It's not necessarily the salesperson's job to make it painful to the buyer. It's the salesperson's job to ask the questions to uncover if the pain to the buyer is great enough to take action, to make a decision and then to implement a solution." - Carole Mahoney
People / Resources Mentioned:
- Buyer First: Grow Your Business with Collaborative Selling by Carole Mahoney: www.unboundgrowth.com/buyer-first-book
Connect with Carole Mahoney:
- LinkedIn: https://www.unboundgrowth.com/
- Website: https://www.unboundgrowth.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 25, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/quick-and-dirty-pricing-research/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 4 of Clubs from the Selling Value card deck.
It turns out that procurement people often lie to us. And it's their job, not necessarily to lie, but it's their job to get a better price.
And what often happens is they'll say to you, "Hey, you're up against these other two or three competitors. In this situation, you have to lower your price if you expect to win this deal." And it turns out oftentimes that's not true. Oftentimes, you're not up against two or three different competitors.
Back many, many years ago when I was in sales, I recall procurement people actually saying, "You're up against this other competitor." And it turns out the competitive product they were looking at wasn't even similar to the product that I was offering. And so, it was obvious to me that they were just lying.
And in fact, I experienced this extremely clearly when I was on the buying situation. I was part of a committee and we'd chosen a software application that we wanted to purchase. And I was in the meeting when procurement said to the company that we were going to buy from, "You're up against these other two competitors, you better sharpen your pencil." And I knew for a fact that wasn't a true statement.
So, please be careful and the way you know is, go back to the committee. Find out if the committee selected you or selected you as one of several different possible alternatives.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
John Ray is a Pricing and Business Development Coach for Professional Services Firms, and a Podcast Host and Producer.
In this episode, John shares optimal strategies for positioning your value proposition to attract the best fit clients for your business.
What you will learn from this episode:
- Discover how to craft a compelling value proposition by identifying the unique value that your clients perceive in your offerings
- Learn about the importance of continuing value conversation
- Overcome the fear of pricing the value you provide to your clients
"Develop your options around that client and let them choose. And you'll find out your pricing suddenly improves."
- John Ray
Topics Covered:
01:15 - How he got himself into pricing
02:10 - Who is his ideal client?
03:59 - Insights on solopreneurs making their business work even if they don't necessarily plan on being a business owner
05:28 - The feeling of fear and inadequacy in pricing in a lot of solopreneurs
06:11 - It's not all about expertise but the value you deliver
08:13 - Suggested value proposition to this case: Roger [the client] loves the fact that I calm him down when he gets notice in the mail, I'm trying to win some new business
09:01 - The importance of continuing value conversation
11:10 - One way to lead a value conversation and for people to dig deep with you
11:47 - Optimal win rate or rejection rate and the significance of having a value conversation
15:25 - Benefits of accepting all clients when you're just starting out [and advantages of niching]
18:42 - Turning the intangible value you have into a tangible range of values for the client
20:47 - Price effectively or end up costing your business
24:10 - John's thoughts on this: If I'm bidding and there's no competition or there is competition
26:11 - John’s pricing advice
Key Takeaways:
"By definition you'll be getting better clients by that measure [35% win rate]." - John Ray
"The great thing about a value conversation, it's a net that allows the great clients in that fits you well, and keeps out the ones that are not great fits." - John Ray
"You don't lean on what you think you're worth, you lean on what the value that you've been able to uncover in that conversation." - John Ray
People / Resources Mentioned:
- Ron Baker: https://impactpricing.com/?s=Ron+BAker
- Allan Weiss: https://alanweiss.com/shop/books/hardcover/value-based-fees-3rd-edition/
Connect with John Ray:
- LinkedIn: https://www.linkedin.com/in/johnray1/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 18, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/what-if-they-find-out/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 4 of Hearts from the Selling Value card deck.
This concept of asking for something anytime we're going to give a discount, we simply refer to it as gives and gets. We don't give anything without getting something. And so, what should we be getting when we're giving something? Well, surely we could get almost anything. What we really want to do is get the things that protect the profit of the company. And what are those things?
If you think about all of the different items that you might be able to claw back from a customer. For example, it might be who pays for delivery. It might be how long the delivery takes. It might be when we schedule it. There's many, many different things we might be able to claw back. What we want to do is, think about how much does it cost us to deliver that thing to the customer so that if we claw it back, if we take that back from our customer, we're actually saving us costs on our side.
Now, a couple quick thoughts. You know that, first off, I'm a pricing person, but in truth, we're thinking about how do we get the best margin for the company. And secondly, you've heard me say over and over again that costs don't matter to pricing, but costs do matter to profit. And if we're talking about a one-on-one situation and we have to give up some kind of discount, then let's try to get something in exchange that lowers our costs.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Michael Hammersley co-founded and invented a payment system designed to locate the market price of any consumer good. He authored the utility patent that protects the invention.
In this episode, Michael discusses the platform he co-founded, a dual-sided marketplace of buyers and sellers that helps businesses reach a pricing competitive advantage.
Why you've got to check out this podcast:
- Discover what Drop Pilot platform is
- Find out how it can benefit both sellers and buyers in determining the best price possible
- Learn to figure out the best pricing your customers are willing to pay
"Find out what your customer is willing to pay before you sell them the product."
- Michael Hammersley
Topics Covered:
01:34 - How he started his career in pricing
02:21 - What's so interesting about analyzing pricing potential as a distressed fund
02:55 - Getting to know what Drop Pilot is and what dual-sided marketplace mean
04:00 - Is Drop Pilot a marketplace or research area and what benefit does this platform have for the sellers?
05:26 - What kinds of businesses work with them and what it means to have multi-unit transactions?
06:18 - Buyer's benefit in using Drop Pilot and explaining the research aspect of the platform
08:34 - Proprietary payment system's role in the marketplace and where his coaching focuses on in regard to the platform
11:01 - How to get people to bid with B2B businesses
12:56 - What is a Drop Day?
18:17 - Is the platform representing the real market?
19:11 - How the whole idea about Drop Pilot started and dealing with scalping issues
20:36 - Michael’s best pricing advice that impact’s one’s business
Key Takeaways:
"We have a lot of repeat droppers who each time they come up with a new product, they'll come back, release it with us, figure out how to price it, and then sell it on their own website." - Michael Hammersley
"If you want to figure out customer willingness to pay for a pricing tool, you really have to generate those numbers on your own based on estimations." - Michael Hammersley
“If you want to look at the pricing analytics and you want to find out what your customers are willing to pay, it actually makes more sense to operate in a pressurized environment because you get the highest and best price.” - Michael Hammersley
“What you would want to do is take a look at the analytics and find the clusters of where the most bids came in like what the most common bid was, and then use that as a reference point to set your retail price." - Michael Hammersley
"One thing that our algorithm or our platform actually does is it completely prevents the use of scalping bots." - Michael Hammersley
Connect with Michael Hammersley:
- LinkedIn: https://www.linkedin.com/in/michael-r-hammersley-77285225b/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on May 11, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/price-segmentation-in-tioli-markets/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 4 of Spades from the Selling Value card deck.
Every time a salesperson gets in front of a procurement officer, a purchasing agent, however they're called, the purchasing agent will act price sensitive. Their job is to get a better price for their company.
And so, they will always tell you that your price is too high, they need a discount. And you have to decide as a salesperson, do you want to give it to them? And here's the trick, does the purchasing agent actually have any power or authority to influence the decision process?
If you're selling a commodity, and they could go to three, or four, or 10 different sources to get essentially the exact same thing, and those are all approved sources for the manufacturing capability, procurement has a lot of power. You need to do a great job at making sure procurement stays happy and figure out what it really takes to close that deal.
On the other hand, if you're selling a piece of capital equipment and you've had a long sales cycle selling to a relatively large committee of people who've been debating, what's the best solution for us? And then they take that to procurement so the purchasing can go buy it. It turns out, procurement has almost no power.
They'll pretend to have a lot of power, but they really don't. The decision was made by the committee. And so, we don't have to give big discounts to procurement in situations like that. Here's the problem, it takes guts.
So, do you have the guts?
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jens Hentschel's passion is B2B relationship management and is especially interested in the interaction between the two sides at the negotiation table: buyers and sellers, suppliers and customers, sales and procurement professionals.
In this episode, Jens delves into the role of procurement in guiding the internal stakeholder's buying journey on the supply side, while the sales professional assists in facilitating a value-based negotiation.
Why you have to check out today’s podcast:
- Gain a comprehensive understanding of procurement's involvement in the sales process using the direct and indirect spend terminologies
- Recognize the significance of involving procurement at the outset of the negotiation process
- Learn how procurement and sales can create a mutually beneficial scenario in pricing value
"When you get into that situation where you have been put on the spot in that negotiation, don't budge on price." - Jens Hentschel
Topics Covered:
01:16 - How he got into pricing
03:04 - Jens important thoughts about Mark's bad impression of procurement
07:27 - A case where it's all about price [on the procurement side] and not a win-win situation
11:12 - Understanding procurement's role in the sales process using the direct and indirect spent terms
15:00 - Why the need to involve procurement early on in the sales process
17:57 - Identifying the right procurement person and establishing the initial conversation
20:49 - A procurement's participation in the customer's buying journey
22:22 - Discussing the concept of supplies vendors list
25:00 - The role that price play in making it to the vendor's list
27:12 - Jens impactful pricing advice
Key Takeaways:
"What we are trying to preach is, involve them [procurement] right away because 90% of what your customers spend is managed through a procurement process." - Jens Hentschel
"Something that I can only recommend to anybody to do is, interact with them [procurement] early, provide them with value insights that they're not able to gather themselves. That's how you start building that relationship." - Jens Hentschel
"My thinking is, the procurement professional is the enabler of the buying journey of the internal stakeholder. And they can do it best by having a salesperson on the supplies helping them to be that facilitator." - Jens Hentschel
"Where really value is created is where the sales professional on the supply side and the procurement professional on the customer side really work hand in hand to promote a solution." - Jens Hentschel
Resources/ People Mentioned:
- Procter and Gamble: https://en.wikipedia.org/wiki/Procter_%26_Gamble
Connect with Jens Hentschel:
- LinkedIn: https://www.linkedin.com/in/jenshentschel
- Website: https://www.fivis.io/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 4, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/price-segmentation-by-negotiating/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 5 of Diamonds from the Selling Value card deck.
We typically give our salespeople some level of discount authority. And the reason we do that is, let's say they walked in, and they asked the factory, or headquarters, 'Hey, could I have a 5% discount?' And we always say yes to that. Then all we've done is slowed down the sales process.
Instead, we give them some level of discount authority. Knowing that, you know, if you come in for 5% or less, I'm going to give it to you anyway. So, you just have permission to go give 5% or less. The problem, of course, is that salespeople typically give the max that they're allowed to give.
There's all these different levers that they could pull. They could sell value, and they can discount price. And discounting price is one of those levers that they're going to pull because it's easy. See how easy it is for me to discount the 5% and it doesn't hit my commission that much. So, it's okay for me to give that 5% discount.
What we want to do as a company is sit back and say, what are the right levels of discount authority? What should I let my salesperson discount to? What should I let my sales managers discount to, my sales directors discount to? There are different levels, and we want them to be incented to discount as little as possible.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Alessandro Monti is a pricing enthusiast and expert on all topics related to monetization, conversion, upselling, digital pricing, price management, and business and pricing history.
In this episode, Alessandro highlights the importance of adopting a monetization-led growth approach for your business and emphasizes the need to start implementing this strategy early on in your business.
Why you have to check out today’s podcast:
- Learn to redefine growth in the sense of making it profitable and sustainable
- Discover the importance of a monetization-driven growth strategy for the long-term success and sustainability of your business
- Find the ideal pricing metric for your business to attain optimal product-pricing-market fit and achieve success
"Choosing the appropriate price metric seems to be probably one of these game-changing moments for your businesses."
- Alessandro Monti
Topics Covered:
01:32 - What brought him to pricing and what made him choose SKP
02:43 - Why he believes in supply and demand
06:01 - Delving into the concept of "growth at any cost" and shifting our focus away from it
08:31 - Defining digital industry and turning away from this 'growth at any cost' mentality
09:36 - Redefining growth
12:25 - Challenging the tools and techniques to get to this ultimate growth
14:49 - Deciding between freemium and free trial [and starting monetization-led growth early on in the business]
20:25 - Extracting value to monetize a product and what is true business success
23:03 - Alessandro's best pricing advice that impacts anyone's business
24:05 - Finding the best pricing metric to use
Key Takeaways:
"Let's redefine growth in the sense of let's make profitable business." - Alessandro Monti
"We don't need the free, just for the sake of having free because there is value in having free users. But besides that, I think you need to seek the conversion and the monetization as early as possible." - Alessandro Monti
"It's growth understood as profitability using all of our modern monetization techniques and there's room for alternative content." - Alessandro Monti
People / Resources Mentioned:
- Taylor Swift: https://www.taylorswift.com/
Connect with Alessandro Monti:
- LinkedIn: https://www.linkedin.com/in/profmonti/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 27, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/simplify-your-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 5 of Clubs from the Selling Value card deck.
Most salespeople are paid on commission, and typically that commission is a percentage of the revenue. So, 2% of the revenue, 5% of the revenue, somewhere in that ballpark.
The problem is, that incremental revenue, if I want to grow my revenue by 1%, the salesperson is only going to get 2%, or their commission rate, of the 1%. And it's a really, really tiny number.
However, for the company, that 1% could be a really big number especially if your overall margins are relatively small, because that incremental 1% of revenue is a hundred percent profit. But we don't incentivize our salespeople to get that next 1% very much.
Ideally, what we would do is, we would create a sales incentive structure so that covering costs, maybe they don't make anything, but anything from cost to list price, the amount of commission, the amount of incentive payment they get goes up for the higher the price they get.
I, typically, like to have a target price. I also have a list price and a floor price. And I'll set three different commission rates. Anybody who can sell at list gets a really high commission rate. Anybody who sells at Target or above gets a mid-level commission rate. Anybody who sells above the floor and below the target, it's a really low commission rate.
But the key is, we want to give our salespeople incentives to negotiate for that last 1%.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Andrew Bailey is a Value Pricing and Price Negotiation Specialist. He is the founder of Commercial Strategy 4. He helps you unleash your pricing power to sell more, more often, and at a higher price to achieve the profits you deserve.
In this episode, Andrew shares his strategy for value-based pricing negotiations to help you achieve the highest possible pricing for your product or service.
Why you have to check out today's podcast:
- Explore how you can present alternative options during negotiations by combining price and value selling strategies
- Discover one great technique for setting the stage and preparing the buyer's mindset for a pricing value conversation
- Uncover a more effective approach to pricing instead of simply relying on discounts
"Improve your prices and just get really good at customer conversations."
- Andrew Bailey
Topics Covered:
01:14 - How he started in pricing
03:40 - Important consideration for negotiation
04:58 - Defining value for clients and questions to ask to understand the value you're delivering
09:21 - Dealing with procurement people versus the pricing committee as you go through value discovery process
12:32 - Key insights on opposing viewpoints between procurement and committee
14:28 - Practicing real-life price negotiations
16:36 - Pricing and value negotiation strategy that people rarely do but should be considered
24:08 - The biggest mistake in pricing negotiations and what should be done instead
27:53 - Andrew's best pricing advice to impact one's business
Key Takeaways:
"Ultimately, your ability to achieve the results that you want in pricing and negotiating is focused around your negotiating strength." - Andrew Bailey
"What I talk to people about is understanding what's really important to customers, what matters to them." - Andrew Bailey
"Don't try to make a whole long list of things that you can do for your clients and customers. It's probably two or three things that's really important to them. Just focus on that. That's a great place to get to." - Andrew Bailey
"We can give some discount and then we agree to it without really thinking about, could we do this differently? Is there a better way, is there more value here than simply that price and that quantity?" - Andrew Bailey
Connect with Andrew Bailey:
- LinkedIn: https://www.linkedin.com/in/pricingmentor/?originalSubdomain=uk
- Email: andrew@pricewithoutfear.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on April 20, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/nobody-cares-about-your-product/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 5 of Hearts from the Selling Value card deck.
It's true, customers hate price increases. Heck, I get an annual price increase from Intuit for my QuickBooks, and I hate it. But there's nothing I can do about it. I just have to sit around and stew about the fact that I really despise that Intuit raises my price every year.
However, when we blame costs, then people hate us a little bit less.
So, we know as pricing people, as salespeople, we know that our prices really have nothing to do with our costs. But our customers don't really know that, and our customers believe the cost drive pricing. So therefore, if we're going to raise prices, the only real reason customers accept is that our costs went up.
Imagine if Intuit sent me that email every year, and instead of it said, 'Hey, we're raising your price by $8, $10,' whatever it happens to be. Instead they say, 'Hey, our costs have gone up this year. We need to pass that on. We're going to increase your price by $10.' sure, I still dislike it. But I dislike it a little less. It's like they have a reason other than, 'Hey, I want you to pay more so that I can make more money.'
So, think about blaming costs when you increase prices.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Darlene Nordstrom is an accomplished pricing professional with experience in developing and implementing worldwide software pricing and licensing strategies spanning traditional on premise, cloud and software as a service (SaaS) offerings. Broad financial knowledge including revenue recognition, standalone selling price, return on investment, profit and loss statements and various analyses such as profitability, variance, impact, market and competitive analyses.
In this episode, Darlene highlights the crucial role of interdepartmental collaboration in developing a robust pricing strategy. Additionally, she stresses the importance of having a designated pricing specialist to oversee the entire process.
Why you have to check out today’s podcast:
- Find out why interdepartmental cooperation makes a successful pricing strategy
- What added value does a pricing person bring to the table with departmental integration notwithstanding
- Learn why you should be discerning when creating short-term and long-term pricing efforts
"Cross-functional collaboration - to me that is key. What's been successful in my 15 plus years of doing pricing is having that cross-functional collaboration where everyone feels like they have a voice." - Darlene Nordstrom
Topics Covered
01:30 - What prompted her to pursue a career in pricing?
02:15 - Pricing as a team effort and a collaborative endeavor
04:49 - How does a collaborative effort in pricing look like in IBM?
05:29 - Discussing the process in reaching a pricing decision
07:18 - Which pricing decisions need this complicated process of decision making?
08:52 - Why the need for a pricing person when there is already a collaboration with other departments?
11:50 - What added value does a pricing team bring to a corporation?
12:52 - Important considerations to think about in terms of creating short and long-term efforts in pricing
15:17 - Partnering with financial folks to do the analytical part of interpreting data and KPIs
17:14 - IBM as a premium price leader doing the competitor-based pricing
18:57 - Talking about the differential value in a competitor-based pricing
20:57 - How hard was it changing a pricing metric for a product and when do you consider changing it?
22:58 - Darlene's pricing advice that could impact one's business
Key Takeaways:
"You don't set your price once and done, you just keep reiterating it. And the pricing team is responsible for providing those meaningful insights." - Darlene Nordstrom
"What you shouldn't do is make short-term decisions that will impact your long-term goals. Being short-sighted and reacting, you don't want to end up in a price war and react because a competitor did something." - Darlene Nordstrom
"You always have to be thinking in terms of that end goal in mind and work backwards, and maybe there are some iterative steps that you could take to get to that end goal. I'd be careful about making some short-term decisions that impact your long-term goals.” - Darlene Nordstrom
People / Resources Mentioned:
- IBM: https://www.ibm.com/
Connect with Darlene Nordstrom:
- LinkedIn: https://www.linkedin.com/in/darlene-nordstrom-96ab4220/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 13, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/lessons-from-a-cute-story/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 5 of Spades from the Selling Value card deck.
A value table consists of four columns: the solution, the problem, the result, and the value, typically in dollars. And when we do this, we think of creating the information, or the data in each cell for a typical customer.
But we would never walk into a customer and say, 'You should expect to make a million dollars by buying this product.' Or we would never walk into a customer and say, 'We would expect you to have 3% more productivity if you buy our product.'
Instead, when we think through all of the columns in a value table, and where additional profit comes from, and where additional productivity or reduced turnover, or whatever other effects we're going to have for our customers, then all we've done is say, 'This is a possible scenario.'
But if we understand what those are, then when we go in and start having conversations with our buyers, and we say, 'What problems are you trying to solve?' Or, 'What results might you be looking for?' We already know how to take those problems, turn them into results. Those results turn them into profit dollars to the customer.
So, I think of a value table more as a roadmap, as a conversation starter. As a way to say, 'Here's where I think the dialogue may be going.' But it certainly isn't the sales pitch we walk in with.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Michael Tatonetti is the Founder and CEO of Pricing for Associations. He is also a Pricing and Value Speaker and Consultant and a Certified Association Executive as well as a Certified Pricing Professional.
In this episode, Michael discusses the importance of aligning pricing and value with the mission of associations and non-profit organizations. He emphasizes that value should be the central factor in creating a pricing strategy, as it resonates more with members and strengthens their connection to the organization.
Why you have to check out today’s podcast:
- Discover the three factors that distinguish associations from traditional subscriptions and find out their similarities in some aspects
- Find out how to price an association and why these two components of value and price tie in together to create the best pricing
- Learn how associations communicate better value in their pricing and the formula you can use to best convey your pricing
"Focus on the value. Always put the value before the price."
- Michael Tatonetti
Topics Covered:
01:01 - How he started a career in Pricing
02:36 - What differentiates non-profit associations from subscription businesses?
03:59 - How does competition feels different in an association space?
05:37 - Looking at an associations membership bylaws, pricing objectives, their competitive positions in the space
07:16 - Three things that makes an association different from subscription business and what makes them the same with it
10:15 - What to consider when shifting from annual to monthly billing for associations and what he advocates as the biggest thing that differentiates association from subscription
12:32 - Pricing an association and when does he consider competitors when pricing?
15:08 - Questions to ask to come up with the best pricing
17:17 - Using Van Westendorp to help in data analysis for pricing [and the number of samples needed for this tool]
18:17 - Michael letting Mark share his own idea of the right number of responses needed for Van Westendorp data analysis
20:49 - Relying on value and not on cost when communicating pricing
24:38 - Michael's best pricing advice that could impact any business
Key Takeaways:
"Most subscriptions, not all, of course, run on like a monthly basis. Of course you can do annual, but most of them, you think in monthly terms where most associations are billing annually." - Michael Tatonetti
"Most subscriptions for profit are able to just auto-bill where some associations, depending on state, cannot auto-bill, they can opt in, but for some they cannot." - Michael Tatonetti
"Associations are typically divided into one of two categories, either organizational or individual. They're typically called trade or individual, trade is organization. Now, when you have an organization, then yes, typically they're not going to have it on renew." - Michael Tatonetti
"I think of traditional subscriptions as an individual, I sign up and then I cancel when I want. Where with associations, there's typically more thought-power that goes into the decision to continue year over year." - Michael Tatonetti
"I lean in on value a lot. I typically will not do work with an organization on just price. I typically require that we're doing value and price because most organizations don't change their value too often." - Michael Tatonetti
People / Resources Mentioned:
- Robbie Kellman Baxter: https://impactpricing.com/podcast/ep94-powerful-pricing-insights-from-a-subscription-expert-with-robbie-kellman-baxter/
- Van Westendorp: https://en.wikipedia.org/wiki/Van_Westendorp%27s_Price_Sensitivity_Meter
Connect with Michael Tatonetti:
- LinkedIn: https://www.linkedin.com/in/drtatonetti/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on April 6, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/you-have-the-curse-of-knowledge/
[powerpress]
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 6 of Diamonds from the Selling Value card deck.
If you are having value conversations, you're focusing on, what's the problem the client's trying to solve? What's the result they might expect to achieve?
And if that result is quantifiable and we're selling to a company, then almost certainly you can turn that quantifiable results into incremental profit to that company. But in order to do that, we have to understand the business of our customers.
I remember a long, long time ago when I was in sales, we were selling automatic test equipment and we had a device that was more accurate. But in order for the test equipment that was more accurate to have value to the client, we had to show, how does this more accurate tester generate more profit?
Well, the answer was, in order for a semiconductor manufacturer to ensure that a part was of a specific speed, they had to take in the accuracy of the test equipment. And so, if a test equipment was less accurate, they would build a bigger guardrail. And if a test equipment was more accurate, they could have a smaller guardrail, which meant more parts would pass the test. And those more parts passing tests were sold at higher prices, meaning they made more profit.
The point is, if we don't understand the business of our customers and we don't understand how they're going to make additional profit, then it's really hard for us to help our clients say, here's why this capability generates more profit for you. And when we're able to do that, then clients are much more likely and willing to buy from us.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, and read the saying. Then, talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Robbie Kellman Baxter is an Advisor to the world's leading subscription-based companies, a Keynote Speaker and Author of The Membership Economy and The Forever Transaction. She is also the Host of Subscription Stories Podcast.
In this episode, Robbie discusses the significance of upholding ethical standards when implementing a subscription business model, as it greatly affects the company's long-term viability.
Why you have to check out today’s podcast:
- Learn about the unethical practices in subscription pricing and their long-term implications for your business
- Find out effective price segmentation strategies that can be applied to your subscription-based business model
- Know why these companies are the best models when it comes to subscription pricing
“Have a rationale for your pricing structure that you would be comfortable showing to a loved one who is a customer.”
- Robbie Kellman Baxter
Topics Covered:
01:49 - What drove her entry into Pricing
04:28 - Why some companies make it hard for subscribers to cancel and what is it's negative implication in the long run
08:12 - Bad karma as a consequence of hiding a cancellation button
09:20 - Discussion around an advancing legislation on making it easier to cancel subscriptions anytime
11:11 - Understanding price segmentation in a subscription pricing
17:20 - How she negotiates when buying a car, for instance, knowing someone else paid a different price for that
19:20 - Price segmentation discussion around Everyday-Low Price[EDLP] versus High-low Price
21:09 - Discussing pricing segmentation used by Netflix and news organizations
23:25 - Another price segmentation point of discussion [based on where you live and how busy these areas are]
26:06 - Case in point at Macy’s on price differential as the topic of discussion
27:51 - What makes her price sensitive even when she’s non-price sensitive
29:20 - Robbie’s best pricing advice
Key Takeaways:
"I tried to explain to them how [putting some friction into your cancellation process] in the short-term does work, in the long term, it kills your business. It kills your reputation, it ruins the trust." - Robbie Kellman Baxter
“Whatever it took to get you in there, it should take you out. If you can sign up any day of the week, any time of day, you shouldn't be required to cancel Tuesdays between two and four.” - Robbie Kellman Baxter
“Where I come down on differentiated pricing or segmented pricing is if you can explain it to somebody. If your mother would be okay with being on the high end of that pricing and understanding why you're doing it, then I'm okay with it.” - Robbie Kellman Baxter
People / Resources Mentioned:
- SiriusXM: https://www.siriusxm.com/
- Wells Fargo: https://www.wellsfargo.com/
- Suzi Watford: https://www.linkedin.com/in/suzi-watford-18547817/
- Dow Jones Wall Street Journal: https://en.wikipedia.org/wiki/Dow_Jones_%26_Company
- Booz Allen: https://www.boozallen.com/
- Macy’s:https://www.macys.com
- JCPenney: https://www.jcpenney.com/
- Netflix: https://www.netflix.com/
Connect with Robbie Kellman Baxter:
- Website: https://robbiekellmanbaxter.com/
- LinkedIn: https://www.linkedin.com/in/robbiekellmanbaxter/
- Email: rbaxter@peninsulastrategies.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 30, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/ford-patents-feature-with-negative-value/
[powerpress]
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 6 of Clubs from the Selling Value card deck.
First, let's talk about an analytical journey. These are those people who, once they realize they have a problem that they might want to go solve, they spend a bunch of time doing their own research, probably on the internet, figuring out what are the different options, where they might buy it, what are the price points? These are the most price sensitive buyers we can deal with.
And yet, if we get an opportunity to talk to them as a salesperson would talk to a potential client, we could be sitting there saying, Hey, here's why our product is better than our competitor's product. But my recommendation would be to make sure we have the value conversation about the inherent value of solving the problem.
If we have that conversation, it may be that the buyer didn't realize that there were a lot of other opportunities or a lot of other places where there's value if they buy a product like this. The person might begin to trust the salesperson more and say, Hey, this person's really looking out for my best interest. The buyer is more likely to buy because we're showing them more and more value.
So, for a lot of different reasons, it makes sense for us to make sure that we're going back to, let's call it "first principles". We're going back to help our buyers understand what's the value of solving the problem. And in the meantime, we also need to talk about how we are differentiated and possibly better than competitive alternatives.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
JD Dillon is the Chief Marketing Officer, Communications Leader, and Pricing Professional at Tigo Energy.
In this episode, JD shares his 8D problem-solving technique that helps create a solid pricing strategy in place.
Why you have to check out today’s podcast:
Understand what the 8D technique of problem solving is and where you can specifically apply it to. Learn how to figure things out and find solutions logically rather than emotionally. Discover about the 'Five Why' in verifying the root causes of a problem.
"If you are in a situation where there's a price reduction, try to do two or three other things first." - JD Dillon
Topics Covered:
00:49 - How JD’s Pricing journey started 02:00 - Updates about T.J. Rodgers 03:05 - Overview of what the Eight-D problem-solving technique is all about 03:50 - How does a quality program relate to pricing? 05:19 - What goes on in D-Zero? 07:24 - Where do we ideally apply Eight-D to? [Showing a case study] 08:47 - D-One: What happens here? 10:16 - How do you go about D-Two? 12:45 - Action steps you need to do in D-Three 15:10 - Finding the root causes with D-Four and using the 'Five Why' technique 18:03 - How do you verify permanent corrective action in D-Five? 19:56 - Getting everything executed in D-Six 20:38 - Digging deeper into D-Five and [culture and internal processes] 21:35 - Preventing the occurrence in D-Seven 23:29 - D-Eight: Congratulating the team 25:14 - How often do you perform the Eight-D process? 28:01 - JD's best pricing advice that impacts one's business 29:16 - One important key to success in business
Key Takeaways: "Pricing is the quality metric for revenue." - JD Dillon
"If you do it right [Eight-D process], it builds into the DNA of the company. And after a few years you've improved your DNA continuously and quite a bit." - JD Dillon
"What I described is a thought process, that's all. You can do it in a meeting with people that know what they're doing. I can do it with somebody who's worked for me in the past and we can quickly go through the process in 10 minutes about one small little issue and then move on." - JD Dillon
People/Resources Mentioned:
Ted Levitt: https://en.wikipedia.org/wiki/Theodore_Levitt T.J. Rodgers: https://en.wikipedia.org/wiki/T._J._Rodgers
Connect with JD Dillon:
LinkedIn: https://www.linkedin.com/in/jd-dillon/
Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 23, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/discrimination-or-segmentation/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 6 of Hearts from the Selling Value card deck.
I work with clients frequently about creating these value tables. And what we essentially do is we identify, what are the best features in the product? What problem does that feature solve for the client? What's a quantifiable result that client may expect? And then, what's the amount of profit that client may be able to get when they achieve that result?
In a way, you could think of this as an ROI calculator. But the problem is, you can't go in with an ROI calculator and tell a buyer, 'Hey, you're going to go make this much money if you buy my product.' They don't believe you.
In fact, if you use the document and everything that we put on there, it's probably not accurate for every single customer. In fact, it's probably not accurate for any customer.
So, our recommendation is always, when you've created the value table, think of it as a thought process, this is where the value could be. And now we go talk to a buyer. And we understand, do you have this problem? 'Oh, yeah.' What kind of result do you think you might expect? 'Oh, let's see if we can figure out the profit to your company if you achieve that result.'
We use this as a map, as a document to help us understand where we're going, but we don't use the document to say these are the facts for any given client. So, we want to use the information, not the details of the document.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
As the founder and CEO, Joe Woodard empowers small business advisors to transform small businesses. He works toward this vision as the host of the annual Scaling New Heights conference, the host of Woodard Alliance, the head of Woodard Institute and various speaking and writing engagements he performs throughout the accounting and bookkeeping professions.
In this episode, Joe discusses how to design a subscription pricing model that prioritizes building strong relationships with clients, empowering them, and generating a long-term impact on their businesses. This approach also helps increase the lifetime value of clients.
Why you have to check out today’s podcast:
- Get an in-depth discussion on pricing result versus pricing transaction
- Understand how charging relationships works in a subscription pricing model
- Uncover how to price human connections that go beyond financial reasons
"Be bold with pricing. You are worth more than you think you are, and definitely more than your clients think you are." - Joe Woodard
Topics Covered:
01:29 - Talks about getting differentiated from the rest with his degree in classical Greek
03:37 - How his career path ended in Pricing
04:25 - What is so significant about the subscription business model?
06:16 - How do you price a relationship?
10:08 - Going in-depth into pricing for a relationship
13:40 - Measuring the service-provider-client relationship
15:12 - Going beyond financial outcomes when measuring the economics of relationship
16:25 - Discussions around Mark's objections: 'I don't see how you price for it [relationship]
17:02 - Pricing human connection that transcends economics
20:57 - The danger about price segmentation in relation to pricing relationship
22:03 - Pricing segmentation's end-goal in a subscription model
23:38 - Healthy subscription versus toxic subscription
25:48 - Driving customer lifetime value plus creating experiences for engagement
27:43 - Joe’s pricing advice
29:19 - Connect with Joe
Key Takeaways:
“We're intensely focused on the customer's outcome, and our outcomes become a means to that outcome. And therefore, we are pricing the relationship we have with the client because it's about the outcomes we're driving in that relationship.” - Joe Woodard
“I am delivering, within the context of a relationship, value. And part of that is, I’m giving you attention at the individual level. Not a newsletter, not cookie cutter answers. There's something where you're individually being touched.” - Joe Woodard
“Relationship economics is about the business outcomes or the business benefits that are gained by being in a relationship.” - Joe Woodard
“The intensity of the relationships increases based on the value that you've added in the amount of attention that you're able to give.” - Joe Woodard
People / Resources Mentioned:
- Ron Baker: https://impactpricing.com/podcast/ep44-ronald-j-baker-trash-the-timesheet-exploring-opportunities-in-subscription-businesses/
Connect with Joe Woodard:
- LinkedIn: https://www.linkedin.com/in/quickbooksadvisor/
- Website: https://www.woodard.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on March 16, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/interesting-starlink-price-changes/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 6 of Spades from the Selling Value card deck.
Make it simple for buyers to decide. One of my favorite sayings is, “A confused buyer won't buy.”
If you think about it, we're all afraid to make mistakes. We don't want to make mistakes. And the more difficult we make the decision, the more likely somebody thinks, a buyer thinks, they might make a mistake. We want to make the decision really simple, really clear, really obvious, so that our buyers don't think they're making a mistake.
There are two techniques that are really common in simplifying this decision process. One is Good-Better-Best. If you have a complex price list, a complex set of options, buyers get confused. They really don't want to make that decision. They don't want to make a mistake. But if you can simplify the decision into a good-better-best offering, it's so much easier for buyers to make that decision, and they're so much more likely to make it.
Another place we often see the simple decision for buyers is called The Decoy Effect. This is a psychological aspect in pricing. But a decoy effect is essentially good-better-best, but it's where you make the better price and the best price really, really close to each other.
And so, buyers look at that and it's easy to make a decision between best and better because it's a slight, or maybe even no price increase, and they get a lot more. And so, yeah, I can choose best over better. And once they know they can make an easy decision, they feel like they're not going to make a mistake.
So the rule here, make it simple for buyers to decide.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is Ibbaka’s Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value. Steven is what I consider one of the great pricing thinkers in our industry.
In this episode, Steven enlightens us about hybrid pricing models and explains why we should adopt it. He also shares why pricing people need to change the way they see AI along with the work they do in pricing.
Why you have to check out today’s podcast:
- Understand one of the unstated rules of pricing that talks about pricing power along with insights into future risk
- Find out how artificial intelligence (AI) can help address concerns regarding the connection between pricing and predictability, and why pricing people should change how they see AI in line with pricing
- Discover the reason on why most of us need to adopt hybrid pricing models and why the two pricing metrics in that should be independent of each other
“Most of us need to adopt hybrid pricing models, and the two pricing metrics should be independent of each other. If the two pricing metrics track each other closely, why bother having a hybrid pricing model? You need two metrics that are relatively independent of each other, and that will give you the flexibility you need to respond in a difficult economic environment.”
– Steven Forth
Topics Covered:
00:42 – Steven’s insights on what a hybrid pricing model looks like
02:30 – Issues on pricing model that applies credits/tokens to usage
04:44 – Predictability; whoever has the best insight into future risk has the greatest pricing power
09:37 – Pricing people vs. the recent trend: AI and how it sets prices
12:02 – The Achilles heel of value-based pricing, and the hybrid pricing practice in companies
18:09 – What real value-based pricing is about
20:52 – An optimal pricing model if you want to combine two metrics
24:31 – Confused buyers don’t buy and renew
27:18 – Three reasons why calculators don’t expose their logic
28:42 – Steven’s pricing advice
29:42 – Connect with Steven
Key Takeaways:
“If you have enough data, you can actually get pretty good at predicting future usage.” – Steven Forth
“One of the unstated rules of pricing is that whoever has the best insight into future risk has the greatest pricing power. The better we get at prediction, the more accurate we can get at pricing, and the question then becomes, who has the data to make those predictions? And I think in many cases, it's actually the vendor who has better access to data.” – Steven Forth
“This whole question of predictability and pricing is going to be a key question for pricing over the next three to five years, and the artificial intelligences are going to help us to answer that question much better than we've ever been able to answer it before.” – Steven Forth
“If you're optimizing value for the customer, you're optimizing the amount that they're willing to pay you, so if you just do it to optimize revenue, you'll end up shooting yourself in the foot because you'll trigger that negative feedback loop.” – Steven Forth
Connect with Steven Forth:
- Email: steven@ibbaka.com
- LinkedIn: https://www.linkedin.com/in/stevenforth/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 8, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-professionals-have-trained-incapacity/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 7 of Diamonds from the Selling Value card deck.
So, when you talk to your buyers about value, they do shift the way they think from spending on an expense toward investing. Because typically when you or anyone is shopping for something, we're thinking, how much do I have to pay and what are the features that I'm going to get? And we stop thinking about the value of what it is that we're buying.
And if we have the opportunity to help our buyers understand, hey, when you go solve this problem, what's the value of solving that problem? So maybe, yeah, you're going to pay me a lot of money, but think about all the money you're going to make in additional profit because of the fact that you bought an implemented and used my product.
And if we can get them focused on the value, they become a little bit less price sensitive and they trust us and like us even more. So, my recommendation is, talk about value way more than we talk about features and price.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dick Sobel was with Emerson for 21 years where he mostly worked on pricing roles. Currently, he is the managing director of PricePoint Partners, a company that helps clients achieve significant gains in price realization and profitability with salesforce implementation utilizing cloud-based Acuity Margin Management BI software.
In this episode, Dick talks about the work they do at PricePoint Partners as he points out the importance of assessment and consulting in coming up with optimal solutions to clients’ problems. He also touched on the topic of AI interference in the pricing world.
Why you have to check out today’s podcast:
- Learn the work that PricePoint Partners does, the range of clients they serve, and how they could help your company in pricing
- Find out why you can’t rely on AI alone in doing prices and why AI can do better in B2C than in B2B
- Find out why today is the best time to raise your prices
“Inflation's persistence is here to stay for a long time. And if you're not doing something right now, you are really missing out.”
– Dick Sobel
Topics Covered:
01:49 – How Dick got into pricing
04:40 – How Emerson did pricing before, and how they moved to value pricing as time went by
06:50 – The work that PricePoint Partners does, and the range of clients that they support
08:21 – Is PricePoint Partners a software company, or a consulting company?
10:23 – What prompts companies to focus on pricing
13:19 – Does PricePoint Partners charge for assessment?
14:58 – Why assessment is an essential part in consulting, and why you should definitely pay for it
17:25 – Why you should be careful in using AI, and why pricing people and clients are still more comfortable
22:02 – Dick’s pricing advice
23:32 – Connect with Dick Sobel
Key Takeaways:
“Somebody has to be in charge somewhere that can at least gather the crew together and make it [changes in pricing strategy] happen.” – Dick Sobel
“At least for the people that I deal with, I don't feel comfortable having or I don't think they're even comfortable in having black box artificial intelligent price recommendations where “Okay, here's the price you should charge for this product, for this SKU”. And it's given to the salespeople arbitrarily. There's got to be this human interface still. And so, yeah, you can look at it, but be careful.” – Dick Sobel
“This idea of “Well, you know, we're just going to try to hold the line”, you keep doing that, you won't have a business.” – Dick Sobel
People / Resources Mentioned:
- Emerson: https://www.emerson.com/en-us/global
- PricePoint Partners: https://pricepointpartners.com/
- Resilience Capital: https://resiliencecapital.com/
- Salesforce: https://www.salesforce.com/ap/
- Vendavo: https://www.vendavo.com/
Connect with Dick Sobel:
- LinkedIn: https://www.linkedin.com/in/richardsobel/
- Email: rsobel@pricepointpartners.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 1, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/wow-a-price-decrease/
[powerpress]
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 7 of Clubs from the Selling Value card deck.
Anytime you're in a sales situation, we think to ourselves, Hey, we need to be selling against our competition. We need to point out why we're better than our competitors.
Yeah, and maybe we do. I'm not going to say we don't need to do that.
However, if we take the time to help the buyer understand, what's the underlying problem they're truly trying to solve? What's the value of solving that problem? And how it is that we help them solve that problem? It builds trust. They start to know that we understand their situation, we understand their problem. They believe that we'll be better at solving it simply because we've expressed the fact that we understood it.
Oh, and when we help them build the business case, they are grateful because they need this information to help sell up inside their organization anyway. Because no one's going to buy something unless they know that it's going to help them make more money. And so, we need to help our buyers create that business case.
So, it really is imperative that even if you know you're going to have competition, take the time to help your buyers understand the value of solving the problem. Not just focusing on why we're better.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Alex Galkin is the Co-Founder and CEO of Competera, a pricing optimization SaaS company converting technologies into ready-to-use products for enterprise retailers worldwide. Alex has been a mentor at his startups for several years, and he’s a Ukrainian who left four days before the war started.
In this episode, Alex helps us understand the pricing and ML work that they do at Competera as he talks about the three models they always put into use.
Why you have to check out today’s podcast:
- Understand why you should treat pricing as a process
- Find out how Competera helps their clients in making pricing decisions
- Discover three models that Competera puts into use as MLs look for reasonable factors to make a price adjustment
“Pricing is a process, and you need to continuously improve as any other process in your organization.”
– Alex Galkin
Topics Covered:
01:04 – How Alex got into pricing
03:07 – The work that Competera does in relation to pricing, and how they do it
08:28 – Using ML-driven price recommendations: Competera creating a ‘gray box’
12:35 – Talking about the portfolio-wide pricing/portfolio optimization
14:12 – An ML example of the decoy effect
17:20 – Alex explains how their smart product segmentation works; a product bringing more people in the store
23:09 – Alex’s pricing advice
23:49 – Connect with Alex Key Takeaways:
“ML is not a human. He’s not trying to play with the price; he's changing only if he sees the reasonable factor to make this price adjustment.” – Alex Galkin
People / Resources Mentioned:
- Competera: https://competera.net/
Connect with Alex Galkin:
- Email: galkin@competera.net
- LinkedIn: https://www.linkedin.com/in/alexandrgalkin/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This one is the 7 of Hearts from the Selling Value card deck.
It is true, value propositions really are awesome.
Marketing teams, companies, sit around to try to figure out, what's the value proposition of this product? And it turns out that we can often come up with something that's pretty good, pretty general. It essentially is the solution to a problem that most people have, and we think of that as the value proposition.
But the thing is, the value proposition isn't specific enough. Anytime you go to an individual customer, or an individual buyer, they've got different problems. Maybe our value proposition caught their attention, got them to come talk to us.
But in the end, we need to understand, what are the specific problems that that buyer has? What's the result that that buyer's looking to achieve? And then help them figure out, what's the business case for that? How much value, or additional profit, will they make because they're solving those specific problems?
So, I love value propositions. They're just not magic words that are enough to get people to buy.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on February 22, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/lessons-from-the-library/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Casey Brown is the President of Boost Pricing, and she has been since 2011. She started her career as a Chemical Engineer at GE, and she's been in pricing for almost 20 years now. Casey loves whitewater kayaking, and she's a big Buckeye fan.
In this episode, Casey explains how important it is for sellers to connect with the emotional component of the buyer/s as she shares her knowledge on how to substantially increase your ability to earn higher prices.
Why you have to check out today’s podcast:
- Learn how crucial the seller’s mindset and beliefs are to the business’ profitability, especially as to whether they’re operating from a place of confidence or fear
- Find out why you should not put the blame on cost increases when doing a price increase
- Understand the power of taking into consideration the emotional component, like selling value through the language, mind, and heart of your customer
“I have yet to find, even in this current economic climate, a company that doesn't have some pricing opportunity, and I would just ask everyone to keep looking for it. It's there.” – Casey Brown
Topics Covered:
01:33 – How Casey got into pricing 04:54 – Mark to Casey: Why don’t I know you? Why have I never seen you before? 07:00 – The biggest problem in sales being the lack of recognition that there’s a problem 09:33 – Is Casey trying to compete with people who are doing sales training and education? Both yes and no 11:33 – An exchange of Mark’s and Casey’s magic formulas in communicating price increases 15:05 – More about blaming costs and cost-plus pricing 18:02 – Teaching salespeople how to properly sell value 20:40 – Convincing Mark that the emotional component is as important in B2B as it is in B2C 29:17 – Casey’s pricing advice 30:08 – Connect with Casey Brown
Key Takeaways:
“Our entire profession – we are the best kept secret in business. And frankly, if more people understood how impactful pricing is to the profitability and how easy it is to pull that lever, there'd be a lot more of us.” – Casey Brown
“It does not occur to most people that the biggest opportunity to make a huge improvement in your pricing performance very quickly is not necessarily to fix your strategy, but instead to help the team understand the skill set and mindset gaps that your team has.” – Casey Brown
“Connecting with the emotional component of the buyer is not just a consumer phenomenon.” – Casey Brown
People / Resources Mentioned:
- Pricing with Confidence (Reed Holden’s book): https://www.amazon.com/Pricing-Confidence-Leaving-Money-Table/dp/0470197579
Connect with Casey Brown:
- LinkedIn: https://www.linkedin.com/in/caseybrownboost/
- Email: casey@boostpricing.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This one is the 7 of Spades from the Selling Value card deck.
It is true that when a buyer's asking for help justifying a purchase, this is the ultimate opportunity to influence that sale.
Let's take a step back for just a minute and think about what a customer is going through. And if you ever have the opportunity to help a buyer understand their underlying problems, what's the value of solving those problems, you've become a trusted advisor. You've become someone that this company, this person, looks to for real information so they can make smart decisions.
Now, this is a very different decision process than, how is your product better than somebody else's product? Instead, they've brought you in to help create the business case. What a great position.
And if we go to the table that I have in the Selling Value book, you'll find that this is the beginning of the trust or the relationship journey. Where they say to you, would you please help me answer, is this a good place for me to spend my money? Is this a good place for my budget?
And if we can help them with that, not only have we helped them solve a problem they're trying to solve, but we've built that trust and credibility in their eyes that no competitor could ever catch up to. So absolutely, this is the biggest opportunity you have to influence that sale.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on February 15, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/amc-changes-pricing-finally/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Griff Parry is the Founder and CEO of m3ter where he helps make it easy for SaaS companies to intelligently deploy and manage usage-based pricing. He's led AWS’ go-to market strategy for games and gambling in EMEA, and his background includes entertainment at Sky TV and accounting at Ernst & Young. Griff was an extra in the movie “First Night” around 1993.
In this episode, Griff shares the work that they do at m3ter in helping customers deploy and manage usage-based pricing. He also discusses common pricing challenges, especially on doing a price change, emphasizing the importance of agility and transformation.
Why you have to checkout today’s podcast:
- Understand the importance of having the agility to change pricing models quickly and in different situations, especially as to why pricing is not a one-and-done thing
- Discover how m3ter helps SaaS companies make it easy to deploy and manage usage-based pricing
- Find out in which circumstance usage-based pricing works best as you learn about different pricing philosophies
“Particularly in these market conditions, I would suggest that you set yourself up so that you can customize pricing by customer, or do more of that. There is a lot of money you'll be leaving on the table if you have a one-size-fits-all pricing strategy.”
– Griff Parry
Topics Covered:
01:49 – How Griff got into pricing
03:05 – What m3ter aims to solve in relation to usage-based pricing
05:06 – Delivering agility to the customers (why pricing is not a one-and-done thing)
08:57 – How m3ter helps customers find the right pricing model for the right situation
11:30 – Circumstances wherein you’d want to use usage-based pricing
14:45 – Pricing is an exchange of value between you and your customers
16:09 – Bill for overage over cap vs. renegotiate next year (tips on do’s and don’ts)
20:02 – Platform versus solution pricing (pricing philosophy of AWS and m3ter)
30:59 – Griff’s pricing advice
33:05 – Connect with Griff
Key Takeaways:
“Pricing is complicated; it involves lots of people. You need to bring them together so that they can plan and deploy those changes.” – Griff Parry
“Pricing is very definitely not one-and-done.” – Griff Parry
“To work out what you want to price, you have to look at what's going on at the moment. You have to have ready access to data about what people are consuming and how they respond to pricing changes.” – Griff Parry
“Pricing is an exchange of value between you and your customers. If they understand that they should pay more because they're using more or getting more value, that's fantastic; that's great for both parties.” – Griff Parry
People / Resources Mentioned:
- m3ter: https://www.m3ter.com
Connect with Griff Parry:
- Email: griff@m3ter.com
- LinkedIn: https://www.linkedin.com/in/griffinparry/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on February 8, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-price-signaling-example/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Diamonds from the Selling Value card deck.
Let's say that you are in a marketplace where people almost always decide between your product and competitor's products. Gee, could I think of some? How about an automobile, right? You happen to be the Audi dealer and somebody is, somebody just crashed their car and we think they're going to walk into our Audi dealership.
In our mind we're thinking, Hey, they're not only looking at us, but they're also looking at BMW or Mercedes or Lexus or Porsche, right? There's lots of different places where they might be go looking at my competitive alternatives. And so as a salesperson, I might be thinking, Ohh, I've got to sell against all of these other problems, or all of these other competitive alternatives.
On the other hand, it is very possible that somebody walks into our showroom and isn't going to consider a competitive alternative. They walk into our showroom because somebody told them that we are the best product, we're the best dealership, and they should go buy a product from us. And they're not even going to go look at somebody else.
Or maybe they walked into our showroom because they've owned three Audis in the past. They're an Audi loyalist. And they're going to come in and buy another Audi from us because that's what they drive. That's who they identify as.
There are lots of reasons why people might choose to just buy your product. What we want to do is think about, what are those different situations? What are those different mindsets where people might just be looking at our product and not a competitive alternative? And the reason this is so important is because when we can recognize those reasons, we don't have to give big discounts.
People are going to buy from us because we solve their problem, not because we're cheaper than a competitor.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Satish Dharmarajan is the Director of Pricing and Business Intelligence at Orkin, He is an Advisory Board Member at the University of Tennessee at Chattanooga, and has held analytics roles at Home Depot, Walgreens, and Whirlpool. Satish also acts in short films.
In this episode, Satish educates us on differentiating products/services from competitors of similar offerings as he stresses the importance of understanding the buyer’s journey along with the core problem that they want to solve.
Why you have to checkout today’s podcast:
- Learn the importance of knowing what the buyer's journey is and what state they are in as they come in to buy a product
- Find out how brands differentiate themselves from competitors when they all offer the same products/services
- Understand how customer-perceived value helps brands sell well even with competitors
“If you know your customer, you can price it right. If you know what they're looking for, you can have them pay what you want them to pay for your product or service.”
– Satish Dharmarajan
Topics Covered:
01:50 – How Satish got into pricing
04:29 – Talking about getting to that ‘big place’ and the process that it involves in order to reach that
07:08 – The importance of knowing what the customer is specifically looking to solve
11:39 – Mark’s pigeon problem
12:40 – How brands differentiate themselves from competitors when they all offer the same products/services
17:54 – How customers choose where to buy between brands, and how pricing and packaging people should respond
20:59 – Appliance pricing at Home Depot; how customers care about price changes
23:34 – Looking at and analyzing competition; the importance of customer-perceived value
26:26 – Satish’s pricing advice
26:59 – Connect with Satish
Key Takeaways:
“That's basics of customer service, which is not too different if you were in the cellphone business, if you were in the internet business, or if you are doing anything else, selling anything else online. You would want to know what specifically that customer is looking to solve for.” – Satish Dharmarajan
“The way your products are arranged next to each other, could be used as a leverage for selling the same products at a different price point.” – Satish Dharmarajan
“As pricing professionals, you need to figure out what's the bare minimum, such that you can make sure that even the person who is coming in to replace a refrigerator is going to be willing to pay. But at the same time, it's not at a giveaway price where you're not making enough margins from the other consumers.” – Satish Dharmarajan
People / Resources Mentioned:
- Orkin: https://www.orkin.com/
Connect with Satish Dharmarajan:
- LinkedIn: https://www.linkedin.com/in/satishdrajan/
- Email: sdharmar@orkin.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on February 1, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/evaluating-a-pricing-strategy/
[powerpress]
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Clubs from the Selling Value card deck.
Okay. You're wondering to yourself, do buyers ever not consider competitive alternatives? And the answer is, absolutely yes!
Some easy consumer examples. When you buy popcorn at the movie theater, you couldn't buy popcorn anywhere else. Therefore, you didn't consider a competitive alternative. You just said, am I going to buy popcorn here or not? And that's why they get away with charging really high prices for popcorn.
What about last gas for 75 miles, when you're in the middle of nowhere and you only have an eighth of a tank of gas left? Are you going to buy gas at that gas station that's four times the price? Heck, yes you are! And that's because they know you didn't consider a competitive alternative. There wasn't one to consider at the time.
Our job as salespeople should be to try to find different customers and recognize whether they're going to be looking at, or talking to, competitive alternatives.
For example, if someone was referred to you, they're probably not going to go talk to a competitive alternative. They might, but they might not. So let's treat them as though they won't. What if someone's buying an add-on to a current product they have that you've sold to them? They're probably only buying it from you.
What if they're using your subscriptions and are they going to buy the upgraded package or are they even going to pay you this month for the subscription that they bought a few months ago? In each one of those decisions, they're just deciding, am I going to buy from you? But they're not saying, should I switch? Should I look at competitive alternatives?
There are lots of situations, and product types, where buyers don't look at competitive alternatives. We should be focusing on finding those buyers and making sure we're not discounting, or if we have the opportunity, consider raising the price a little bit. I can almost guarantee you they won't make a different decision.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Johnny Cheng is the Senior Director of Pricing and Packaging at ClickUp. He was the Senior Director of Pricing and Packaging at Coupa Software, and has years of experience in Product Marketing through various companies.
In this episode, Johnny shares his knowledge and experience on product marketing and product management as he educates us on the benefits of solution pricing, especially as to how a lens test helps on creating packages.
Why you have to checkout today’s podcast:
- Find out what crucial perspective companies miss when pricing sits in finance
- Learn about the benefits of having solution pricing, as well as to how you can sell value instead of features
- Discover a packaging system that incredibly works, both for the customers and the company
“Go do the lens test. Even if your packaging is already set, I would go back and do that exercise. I feel like if you do it across different teams, you'll be very surprised at what you see.”
– Johnny Cheng
Topics Covered:
01:05 – How Johnny got into pricing
01:50 – Comparing the role of product management with product marketing
05:46 – Does pricing ever exist without packaging or are the two just so tightly connected?
08:33 – Johnny as a strong believer of having solution pricing
12:18 – Johnny vs. Mark on good, better, best
15:16 – The system Johnny uses to decide which features goes in which package
20:58 – Tips and tools that can help you sell value instead of features
26:56 – Salespeople discounting too much because they don’t sell the value of the product
28:47 – Johnny’s pricing advice
30:05 – Connect with Johnny
Key Takeaways:
“I'm seeing more and more in product marketing just exactly to your point. It's more customer driven, it's more go-to market driven, it's more value driven. And so, if you sit in product management, every feature you release is the best feature ever, right? But product marketing really understands the value and how to apply to certain customers, what the use cases are, what the different profiles are and how you monetize that, and I feel like you kind of lose that lens sitting in the product management side.” – Johnny Cheng
“Once you have kind of that product marketing angle, that's where the magic happens, right? Because that feature could be worth $1 to this one segment and $10 to this other segment. You would never know unless you actually go find out what their pain points are, find out what their needs are.” – Johnny Cheng
People / Resources Mentioned:
- ClickUp: https://clickup.com/
- Marketo: https://business.adobe.com/products/marketo/adobe-marketo.html
- Gainsight: https://www.gainsight.com/
- Coupa: https://www.coupa.com/
- Selling Value: https://selling-value.com/
- Zoom: https://zoom.us/
Connect with Johnny Cheng:
- LinkedIn: https://www.linkedin.com/in/jdcheng/
- Email: jcheng@clickup.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on January 25, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/transitioning-to-selling-subscriptions/
[powerpress]
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Hearts from the Selling Value card deck.
Oh, my gosh! If a buyer ever asked me to help them with a business case, I'm inside quietly jumping up and down rejoicing because they're asking me to do what I would like to be doing with them anyway.
So, instead of me walking them through and convincing them that this is an important thing that they really want to know the answer to, they asked me. Oh, my gosh! And so, if they've asked me for help with a business case, what they're really asking for is, how do I convince my executives that we should be spending money on this problem? Or a better way to say that is, how do I document the value of solving these problems? How much additional profit are we going to make because we spend money to solve these problems?
That is such a phenomenal place to be because inherent value, the value of solving the problems, is the piece of the puzzle that we as salespeople so rarely spend a lot of time on, and yet we should. Because not only does it help our buyer when they're trying to sell it internally, it helps them when they're trying to justify the pricing or spending the money on solving this problem. But it also helps us build a relationship with our client because we're demonstrating to them, we understand their problems.
So, absolutely, if someone asks us to help them with the business case, don't look at that as a chore. Look at that as a golden opportunity because they just asked us to do what we really should be doing with them anyway.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ajit Ghuman is the Director of Product Management, Pricing, Packaging, and Customer Experience at Twilio. He is the author of the book Price to Scale. He’s had Director of Product Marketing title at several companies, and he added pricing to his title in 2019. Ajit is fascinated by ancient mysteries.
In this episode, Ajit educates us on pricing and packaging as he shares why he’s passionate when it comes to changing the monetization stack, especially on companies being able to change pricing strategies a lot quicker than today.
Why you have to checkout today’s podcast:
- Learn how pricing can done through a four-step framework;
- Find out how to create a pricing system that can work well with all strategies; and
- Understand why it’s an advantage to be able to change pricing strategies quickly
“I think of pricing in a four-step framework. The four steps are packaging, pricing metric, tariff structure, and then price point.”
– Ajit Ghuman
Topics Covered:
01:44 – How Ajit got into pricing
03:09 – Ajit talks about his book, Price to Scale, sharing the reason behind writing it and its key concept
04:40 – Backstory as to why Ajit wants to change the monetization stack
08:12 – Why the term quote to cash doesn’t bother Mark vs. how Ajit sees it
11:01 – We need better systems to let the strategy come to life
13:16 – How to create a code to cash (pricing) system that can work well with all pricing strategies
16:33 – Do companies do this practice in pricing?
18:30 – Talking about companies not monitoring usage of their product
19:59 – How often should companies tweak their packaging?
23:08 – How Ajit and Mark decide what feature goes into what package
25:31 – Why Ajit is a bit averse to good, better, best
29:40 – Ajit’s pricing advice
30:35 – Connect with Ajit
Key Takeaways:
“You have the best pricing strategy in the world, let’s say you hire Mark Stiving to help you with your pricing, and you have the best thing on paper, but your systems don't let you operationalize it, so you're stuck in the water. That's what I'm saying. We need better systems to let the strategy come to life.” – Ajit Ghuman
“You're not going to have people write code all the time to do this. Otherwise, your main product will suffer. So just like you used to spend money on product analytics in the past or some other piece of core technology, I think there is a realization companies are having now, like somebody needs to build best practice products that do these things so that we can hook up into their APIs or their SDK and just do it.” – Ajit Ghuman
People / Resources Mentioned:
- Price to Scale: https://ajitghuman.com/pricing-book/
- Code to Cash podcast: www.codeto.cash/author/ajitpal/
- Dor Sasson: https://www.linkedin.com/in/datapm/
Connect with Ajit Ghuman:
- LinkedIn: https://www.linkedin.com/in/ajitpalghuman/
- Email: ajit@pricetoscale.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on January 18, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/another-ridiculous-fee/
[powerpress]
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 8 of Spades from the Selling Value card deck.
When buyers are making a 'will I' decision, they're trying to decide, should I spend money to go solve this problem or not?
Oftentimes, when they're making a 'will I' decision, they've got some problem that has boiled up, that's become an important problem, and they say, "Hey, maybe I'm gonna go consider buying a replacement, a solution, something to solve this specific problem for me."
If you are in B2B sales, what your job needs to be at this moment is, what is the basic problem your buyer is trying to solve? Once we understand that problem, we can help them figure out what's the value of solving that problem.
What this really means is, can we do an ROI calculation? At least the R part of an ROI calculation. Can we help the buyer figure out how much more profit will they make because they buy our product? This is called inherent value.
Inherent value is what's the value of solving the problem, and it has nothing to do with, what's the value of your product relative to your competitor's products. We want to be thinking and helping our buyers think, what's the value of solving the problem?
As salespeople, we always want to be thinking, what's the decision a buyer is making right now? What's the information that buyer needs to help make that decision? And when they're making the 'will I' decision, what they're trying to decide is, is this problem worth me spending my money to go solve? That's why we help them with the inherent value.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you wanna get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dan Balcauski was a program leader for Northwestern University, where he also went to school seven years prior. He is the founder and Chief Pricing Officer of Product Tranquility, a company that helps high volume B2B SaaS CEOs define pricing and packaging for new and existing products.
In this episode, Dan talks about pricing and packaging and how he applies its principles in helping B2B SaaS companies.
Why you have to check out today’s podcast:
- Learn about the similarities and differences of pricing model and pricing metrics
- Discover the fundamental principles of how to decide which features to put on which packages
- Understand why there is no such thing as absolute and optimal pricing
“You don't really have a choice of whether you will have a pricing conversation with your customer. The only decision you get to make is when you're going to have that conversation. So I recommend having it as soon as possible.” – Dan Balcauski
Topics Covered:
01:13 – How Dan got the title “Chief Pricing Officer” 02:04 – The work that Product Tranquility does 02:16 – Dan’s thoughts on packaging 04:31 – How Dan defines pricing metrics and pricing model 10:24 – How Dan decides which features go to which packages 16:50 – Dan’s thoughts on good, better, best packaging 18:51 – How to decide if a specific feature shall go to good, better, or best packages 21:21 – How you should name your packages if you want to call them other than “good, better, and best” packages 23:24 – Dan’s favorite thing to share people about pricing and packaging 26:08 – Do product managers use the word “value” the same way that pricing people do? 28:27 – Dan’s pricing advice 29:58 – Connect with Dan Balcauski
Key Takeaways:
“When it comes to, especially SaaS pricing, most executives think that what you charge determines your success. In fact, who and how you charge determines your success. And the packaging is a huge element of how you charge. It really helps tell and align your value story so your sales and go-to market teams can really get your message across of the differentiated value that you bring.” – Dan Balcauski
“In general, the principle by which I look at this through, is that your bundles, offer configurations, and packages, in Mark's terms, should align to a particular customer segment.” – Dan Balcauski
“If we understand at a deep level what our customer segments need, what their constraints are, what they value, then we can make that decision much easier for them, which increases our sales velocity, reduces our customer acquisition costs, et cetera.” – Dan Balcauski
“If we don't understand the customer we're going after, the problems they have, the outcomes they want, the constraints that they face upfront, the rest of the conversation gets very muddled.” – Dan Balcauski
“There's the right price for the right moment in time for your stage of company, for the life cycle of your industry, for your competitive environment. But you're going to learn, you're going to get better.” – Dan Balcauski
Connect with Dan Balcauski:
- LinkedIn: https://www.linkedin.com/in/balcauski/
- Website: https://www.producttranquility.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on January 11, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/what-pricing-can-teach-sales/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 9 of Diamonds from the Selling Value card deck.
Let's start with, what is a trust journey? A trust journey is when a buyer comes to you, you're the salesperson, a buyer comes to you and asks you for help figuring out what they need to buy, and they never go look at a competitive alternative.
Your job, when they come talk to you, is to talk about, what's the value of solving the problem? What's the best solution to the problem? And importantly, you never ever mention a competitor. As far as your concerned competition doesn't even exist.
When you can recognize that a buyer is going to buy from you without having looked at competitive alternatives, let me assure you, that buyer is not price sensitive. They're looking at, "Ooh, I've got to get this problem solved." They're not out spending their time trying to figure out, where do I get the best bang for the buck? That doesn't mean that we're going to gouge them, but it surely means that we don't have to give them deep discounts.
How do you know if a buyer is on a trust journey or the relationship journey we talked about last week? The best question I've found to ask is, "If you don't buy this, what will you do?"
We didn't imply there was competition. In fact, we implied there wasn't competition. And if they say, "Well, if I don't buy it, I'm going to go look at your competitor," then you know that competition is in the decision process.
But if they say, "I don't know, or nothing," you know competition is not in the decision process. In which case they are not price sensitive. Don't give a big discount.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Armin Kakas is an expert in analytics, having lots of education in statistics, machine learning and A.I. He has an MBA, and he was a former VP of analytics at American Tire Distributors. He is also the founder of Revology Analytics, a revenue growth analytics consulting company.
In this episode, Armin talks about data analytics and its crucial role in pricing and in businesses as a whole.
Why you have to check out today’s podcast:
- Learn the importance of gathering and understanding data both in B2B and B2C setups
- Find out why pricing and price adjustments must be base on data and customer feedback and should never be done internally in a company
- Learn how to communicate and unite insights from both the points of view of business people and statistics people
“There needs to be a much smarter, much surgical way to manage discounts and really reward those customers that have the highest lifetime value or highest volume versus other things.”
– Armin Kakas
Topics Covered:
01:55 – How Armin got into pricing
03:35 – B2B vs B2C: Armin’s experience in applying pricing data analytics, and which one he prefers
05:57 – Armin’s insights on B2C based on data
06:46 – What is promotional effectiveness
07:34 – Products Armin used to promote on Black Fridays when he worked at BestBuy
09:09 – Why CPGs must have a strong understanding of the relationship between price and value
10:19 – Why companies should asses price and value based on customers’ response and not internally
13:08 – How businesspeople and statistics people shall communicate their insights with each other
18:41 – The most common problems Armin find when solving data problems for companies
20:06 – Why companies should have an “algorithm” that tells them how much to buy when a manufacturer offers big discounts
23:18 – Armin’s pricing advice
25:28 – Connect with Armin Kakas
Key Takeaways:
“One of the easiest, quickest insights you can get is by figuring out which are the lowest ROI promotions that are not delivering any value for you or your customers or any of your channel partners, cut them, and reinvest it elsewhere in other growth areas of the company.” – Armin Kakas
“I think that price-value curve tends to change, especially in CPG quite often. And so, doing that more often is really, really beneficial for companies. And doing it in the right way.” – Armin Kakas
“All this unproductive inventory gathering dust in warehouses, clearance price optimization is a huge opportunity. Just really creating some automation and some dynamic methods to clear out the product that is tying up your capital and is actually lowering your productivity as well as your operating profit.” – Armin Kakas
“When you ask the question, “What are some of the other areas that make a huge impact for companies?”, it is really things related to customer analytics, and that has two sides; One is providing insights… and then, the other side is providing actionable insights to the customers themselves.” – Armin Kakas
People / Resources Mentioned:
- Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business – https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784
- Impact Pricing: Your Blueprint for Driving Profits – https://www.amazon.com/Impact-Pricing-Blueprint-Driving-Profits/dp/1599184311
Connect with Armin Kakas:
- LinkedIn: https://www.linkedin.com/in/arminkakas/
- Email: armin@revologyanalytics.com
- Website: https://www.revologyanalytics.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on January 4, 2023, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-trends-in-2023/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 9 of Clubs from the Selling Value card deck.
Let's start with, what is a relationship journey? Buyers who are on a relationship value journey realize they have a problem and then they go straight to a salesperson to learn. They didn't spend a whole bunch of time on the internet researching options or alternatives. They're the type of people who would rather learn from someone else, who would rather get the feedback.
Let's say your refrigerator just broke down, and your friend says to you, "Hey, you got to go talk to Bob at the appliance store, Bob will help you out." And you walk in and start to talk to Bob. Now, what is Bob's job? Bob should be focused on, how is buying a new refrigerator going to be better for your life? Which style of refrigerator is going to be better for your life? They're truly focusing on the problem that you have and what's the best solution to your problem. They're not focused on saying, here's why my store is better than someone else's store, they're just focused on your problem.
If you're in B2B sales, when you find someone who has been recommended to you, your job isn't to sell your product relative to a competitor. It's to sell, here's why solving that problem is so valuable to you.
Now, the relationship journey implies that they're going to go on and talk to some of your competitors. The key though is when you have the chance to build the relationship to help your buyer understand the ROI, you've got this strong advantage because (a) they like you, (b) your competitor is probably not helping them with the ROI analysis, and you've demonstrated that you truly understand your buyer's problems.
So, absolutely, when someone gets recommended to you or someone comes to you and they're not looking at competitive alternatives, talk about the value of solving the problem. Don't talk about competition.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
For the last ten years, Robert Ribciuc has been working as the Managing Partner of EBITDA Catalyst, helping clients accelerate growth in key valuation metrics. He has a BA in Math and Economics from Harvard and an MBA from Chicago Booth School of Business.
In this episode, Robert shares some of his insights on how to deal with different kinds of people in the industry, be it personal or online.
Why you have to check out today’s podcast:
- Get tips on how you could recover and avoid “falls” in your life
- Learn how to give feedback and criticisms in a nice, positive manner
- Discover some lesser-known tricks/hints about how the LinkedIn algorithm works
“If enough people notice those behaviors in you, that are all about you – selfish, self-promoting, etc., most of the time, when a comment like that is posted, nobody replies or gives any acknowledgment to that kind of comment, and you can just hear in that wall of silence all the people who are mentally walking away from this person just like you described.”
– Robert Ribciuc
Topics Covered:
01:37 – Pre-recording conversation about the pricing community and the different kind of people in the industry
07:10 – How to deal with people who self-aggrandize
11:46 – The recipe for avoiding the next “thud” in your life
17:06 – Why everyone avoids people who are negative, selfish, and self-promoting
20:42 – Why many people are reluctant to give feedback or criticism
23:24 – How to give feedback in a positive and helpful tone
24:31 – Some helpful LinkedIn tips/hints from Mark Stiving
29:04 – (When posting something) Add something positive to the conversation instead of demeaning the author
30:19 – Connect with Robert Ribciuc
Key Takeaways:
“Sometimes, pressure brings these behaviors that you and I may be chuckling at and promise ourselves we're not going to be like that.” – Robert Ribciuc
“If you remove this artificial constraint we placed on ourselves, like, ‘I got to grow this fast’ or ‘I got to be on this trajectory’ or ‘I got to reach this amount of money’ or whatever, and you just let that balancing act, and rest on what makes you feel most whole and contributing to the world, maybe that's a recipe for avoiding the next thud in your life.” – Robert Ribciuc
People / Resources Mentioned:
- Savvy Self-Promotion (HBR article): https://hbr.org/2021/05/savvy-self-promotion
- Unreasonable Hospitality: The remarkable Power of Giving People More Than They Expect: https://www.amazon.com/Unreasonable-Hospitality-Remarkable-Giving-People/dp/0593418573
- Richard Bliss: https://www.linkedin.com/in/bliss
Connect with Robert Ribciuc:
- LinkedIn: https://www.linkedin.com/in/ribciuc/
- Email: robert@ebitdacatalyst.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on December 21, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-nespresso-price-increase/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 9 of Hearts from the Selling Value card deck.
It is true that buyers on an analytical journey are very price sensitive.
Buyers on an analytical journey are probably the way you and I shop most of the time, and so it's the most common type of buyer's journey. These buyers are the ones who realize they have a problem, let's say, their refrigerator broke down. Then what do they do? They do a bunch of research to figure out what's the best refrigerator to replace the one that just broke. They know they need to go buy one, but they're on the internet looking at a whole bunch of different brands, maybe different technologies, styles, sizes, colors, and by the time they walk into a store, or two, or three, they've got a great feel and they're comparing, “Hey, how is this one better than that one?”
These are really price sensitive buyers because they've identified what are all the different possibilities and they can trade off, “Oh, do I want water in the door, or ice in the door,” and, “What's that extra cost going to be?” And, “Oh, this brand is so much better than that brand,” and, “How much more am I willing to pay for it?” Price becomes a really big part of their purchase decision.
Sadly, we have to deal with these, and we deal with these the way that they come and expect and ask questions, and we want to find an answer. But the real goal is to be able to identify the other types of buyer's journeys so that we have the ability to capture more revenue from them.
We hope you enjoy this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking and about pricing and value, grab a deck of our cards, pick a card, read the saying, and then talk for one to two minutes about what that card says. You'll become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Bryan Belanger is the senior director of Technology Business Research. He's also the senior director at XaaS Pricing, a subsidiary of TBR that helps SaaS companies price on a data-driven approach.
In this episode, Bryan talks about the work that XaaS Pricing does and who their target customers are. He also shares his insights on other business and pricing models and how you could choose which one works best for your business.
Why you have to check out today’s podcast:
- Find out who XaaS Pricing are and how they might be able to help with your business
- Learn how to create a simple yet effective business framework by talking to your customers
- Get insights on the current trends such as usage-based pricing and product-led growth
“Create a simple framework that works for you. For me, it's probably talk to ten customers; and that, I think, can help you. I think the hardest part is often knowing where to start or what you're even trying to solve for is. So, find a framework that works for you, that focuses on talking to your customers and asking these questions, and let it snowball from there.”
– Bryan Belanger
Topics Covered:
01:51 – How Bryan got into pricing
02:56 – How XaaS started
03:40 – What XaaS Pricing actually does, and who their target customers are
05:00 – Why you’d want XaaS Pricing’s products if you’re a medium-sized company
09:41 – XaaS Pricing’s vision: Systematize the Van Westendorp model
13:46 – Why people in B2B and SaaS businesses are not focusing at their competitors’ prices
15:41 – How XaaS deals with pricing for new customers vs pricing for existing customers
17:34 – Bryan’s thoughts on usage-based pricing
19:38 – Usage-based pricing works for some companies, but not for everyone
21:54 – Bryan’s thoughts on product-led growth
25:17 – Does XaaS Pricing use the product-led growth business model?
26:17 – Bryan’s pricing advice
27:32 – Connect with Bryan Belanger
Key Takeaways:
“I think there's a lot of great tools that if you know what to input, you can build, manage, measure, communicate economic value. But I think the gap is in actually finding the parts of the formula to input into those tools.” – Bryan Belanger
“Just building that muscle of talking to customers and understanding them. That's how I learned, it’s just doing hundreds and hundreds of interviews and surveys. And I think the same applies within companies.” – Bryan Belanger
“I think the instances of true usage-based pricing are still edge cases, and most are just thinking about usage as a way to fence in package offerings more so than they are actually pricing based on usage.” – Bryan Belanger
“It's [product-led growth] not going to work for everybody... If it doesn't work for your customers, it really comes down to who you're targeting, what they value, how you engage with them, all those things. And so, I think like anything else, take it for the secular trend it is. Watch it, understand, learn, but don't jump in and try and change everything just because it's what worked for the people that it worked for.” – Bryan Belanger
People / Resources Mentioned:
- XaaS Pricing: https://www.xaaspricing.com/
- OpenView: https://openviewpartners.com/
- Peer Signal: https://peersignal.org/
- Snowflake: https://www.snowflake.com/en/
- Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business: https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784
Connect with Bryan Belanger:
- LinkedIn: https://www.linkedin.com/in/bryan-belanger/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This one is the 9 of Spades from the Selling Value card deck.
Buyers need different information depending on where they are in their own buying process.
There's a map in the Selling Value book that talks about these different waypoints, but let's simplify it for the sake of this table topics and say, look, there's really two key phases in a buyer's decision process. First, they make a 'will I' decision. Then they make a 'which one' decision.
When they're making a 'will I' decision, they're trying to ask, am I going to buy something in this product category or not? What they're really saying is, is the value of solving the problem worth the resources it's going to cost me to go solve that problem? What we want to give them at this point in time is information that says, here's the value of solving the problem. Here's the inherent value of our solution.
Once they go on to make a 'which one' decision, they're now asking, is your product the right decision relative to your competitive alternatives? And now what they're looking for is relative value information. What's the value of your product relative to your competitor's product? We need to recognize where our buyers are in their buying process, and then make sure that we're giving them the information that they need to get through that stage.
We hope you enjoyed this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what that card says. You will become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ayon Bhattacharyya is the Founder of Biz Growth Spurt, a consulting firm based out of New Zealand. He has experienced pricing in half a dozen companies, and he's a passionate animal welfare advocate.
In this episode, Ayon talks about the ins and outs of monetization. He also tells us a bit about his company, Biz Growth Spurt, and why you might be in need of their services.
Why you have to check out today’s podcast:
- Learn about the three pillars of monetization and why you can’t only focus on one of them
- Know the difference between price metric and value metric and why it matters in getting more sales
- Understand why articulating value is essential in keeping and growing your customers
“Understand your customers intimately and take the time to quantify your buyer personas so that you understand the use case of the value proposition, the willingness to pay the lifetime value, and the customer acquisition costs; so that you can better position and package to them and ultimately capture a fair portion of the value delivered to them.”
– Ayon Bhattacharyya
Topics Covered:
01:33 – How Ayon got into pricing
03:15 – How Ayon defines “monetization”
04:24 – What packaging means to Ayon, in relation to monetization
05:26 – What Ayon means by “feature differentiation”
06:30 – Why Ayon hates freemium
08:04 – Free trials vs. Freemium: why it is important which of the two fits your business more
11:07 – How to decide which features go to which packages
14:02 – Price metric vs Value metric
19:59 – Why positioning is an essential part of monetization
23:22 – Ayon’s key to monetization: the combination of packaging, pricing, and positioning
25:25 – Biz Growth Spurt: What they do and who their ideal customers are
28:50 – The meaning of “monetization” according to Ayon vs the meaning of “monetization” according to ProfitWell
31:54 – Ayon’s pricing advice
32:49 – Connect with Ayon Bhattacharyya
Key Takeaways:
“Once you have a deep understanding of your buyer personas, how they value your product, how they use your product, how your proposition aligns with their growth journey, then you can actually start putting your features into bundles. But you want to do that based on the level of importance of those features.” – Ayon Bhattacharyya
“How you present the packages and the value messaging that you put on your website is so important. If they [the customers] understand that they're getting five times more value from the gold versus the silver, in their mind, it helps them to quantify that relative benefit of the upgrade and the potential ROI of an upgrade.” – Ayon Bhattacharyya
“If the perceived value isn't there, if you aren't communicating it, if you don't have a strong brand presence, if your solution is so complex that customers don't understand the value that they get from it, then you know, you've just wasted all of this money on product development and marketing. – Ayon Bhattacharyya
“Ideally, you want the messaging that you have on your packages is around the problem that you're solving for the customer. That's the key. It's not about the features. Those are just more internal to you. And often the customers don't get them.” – Ayon Bhattacharyya
People / Resources Mentioned:
- Biz Growth Spurt: https://bizgrowthspurt.com/
- Selling Value: How to Win More Deals at Higher Prices: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217
Connect with Ayon Bhattacharyya:
- LinkedIn: https://www.linkedin.com/in/valueconquer/
- Email: b@bizgrowthspurt.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on December 14, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-price-negotiation-example/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is the 10 of Diamonds from the Selling Value card deck.
You should reveal the price only after the value is communicated.
What happens is, when our buyers hear the price, at that moment, they're making a decision. Is the price too high or too low? Is it worth it? What decision am I going to make? Am I going to spend more time with this?
Now, what typically happens is, imagine you're going to buy a pair of Levi's at the retail store, and you walk into the store and you see the price is $60. Well, no one communicated the value to you, but you probably already had a pretty good feeling for what the value of Levi's really is to you. And so, you know if that price is high or low, and if it's worth it to you.
But now, imagine you're a B2B salesperson and you walk in the door and you say, 'Our product is a hundred thousand dollars.' And the buyer instantly says, 'Don't have the budget. That's too expensive. Not going to buy it.' And they don't pay attention anymore. You are done working with that buyer.
But if instead, we spent the time to say, 'What problems are you truly trying to solve? What's the value to the company if we can solve those problems?' And you find out that the value to the company is truly a million or 10 million dollars. Then when you say the number a hundred thousand, they say, 'Oh, that's probably worth it. Let's see if we can figure out how to do that.' It completely changes the perception in the buyer's mind.
So, what we have to do is make sure our buyers have a good understanding of what the value of our solution truly is before we tell them the price.
We hope you enjoy this example of Pricing Table Topics. What you just heard was done without a script. If you want to get better at speaking about pricing and value, grab a deck of our cards, pick a card, read the saying, then talk for one to two minutes about what the card says. You will become a better speaker and expert.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is a Partner in Ibbaka, a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value. Steven is what I consider one of the great pricing thinkers in our industry.
In this episode, Steven talks about AI and how it is impacting the world of pricing. He also shares some of the improvements we could expect from AI infrastructures in the near future.
Why you have to check out today’s podcast:
- Find out how the emergence of AI improves and disrupts the pricing profession and the trade as a whole
- Learn how to extract the best and most comprehensive solutions from AI tools
- Get an idea on how the “big 3” of cloud services might price for their AI services in considering their current pricing models
“Many billions of dollars being invested in AI last year, next year, this year. The overall investment is going to be probably in the neighborhood of $300 billion in 2023. So, if we were investing that much money, we better get some value back. And the companies investing that money need to be able to price that value they're creating.”
– Steven Forth
Topics Covered:
02:10 – The questions that need to be answered about the impacts of AI in pricing
04:06 – Examples of existing value proposition that AI is improving
07:10 – Examples of existing value proposition that AI is disrupting
10:44 – Is the emergence of AI a challenge to the pricing profession?
12:08 – Can open AI soon generate value models that are better than experts create?
15:58 – Why and how large language models such as Chat GPT are taking over
18:06 – How to guide an AI in giving you comprehensive answers
19:34 – What the pricing of major AI infrastructures looks like
21:02 – How Amazon, Google and Microsoft would possibly price for AI considering their present pricing models
23:28 – Will there be different strengths in the AI of infrastructures Amazon, Google and Microsoft?
24:55 – Differences in AIs: Would different Ais give out different answers to the same questions?
26:19 – Could AI effectively learn pricing from human pricing experts?
28:02 – How Ais could start making outcome-based pricing more practical
32:03 – Connect with Steven Forth
Key Takeaways:
“People who are skilled in the art [of trade] understand how to come up with pricing for disruptive innovation.” – Steven Forth
“Understanding the limitations of these large language models, which GPT is an example of, is also important. And we can come to that. But let's not forget that the limitations today are not the limitations in six months.” – Steven Forth
“That, I think, is actually one of the emerging skills: To be able to structure a sequence of questions that will guide an AI in giving you meaningful answers.” – Steven Forth
People / Resources Mentioned:
- Ibbaka – https://www.ibbaka.com/
- DALL·E 2 – https://openai.com/dall-e-2/
- Chat GPT – https://openai.com/blog/chatgpt/
- Amazon Web Services – https://aws.amazon.com/
- Google Cloud Services – https://cloud.google.com/
- Microsoft Azure – https://azure.microsoft.com/en-us
- NVIDIA – https://www.nvidia.com/en-us/deep-learning-ai/products/solutions/
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on December 7, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/black-friday-and-price-elasticity/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the 10 of Clubs from the Selling Value card deck.
Yes, a value conversation is a great way to build a relationship with your customers, with your buyers.
Face it, your buyer probably hasn't put together a business case for what it is they're trying to buy. And yet, it makes a lot of sense for them to have one. It gives them more confidence, they're making the right decision. It gives them the ability to sell up in the organization in case they have to convince someone else to give them the resources. It provides the justification inside the company that they're doing a good thing for the company.
And so, they really want to create a business case. But they probably haven't done it because they didn't think about it. They don't really know how.
If you can help your buyer write that business case, and that's exactly what selling value means, then you are truly helping the buyer. You're adding a lot of value to that buyer's decision process, to their career, to their prestige inside the organization.
Having a value conversation not only helps you understand how much value there is in that situation, but it helps you build the stronger relationship with your buyers.
So, have value conversations. They truly demonstrate that you care about your buyer.
We hope you enjoy this example of Pricing Table Topics. If you want to get better at speaking, especially about pricing and value, grab a deck of our cards. Pull a random card and read the saying. Then talk for one to two minutes about what that card says.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Mark Peacock has been a pricing consultant since 2017. Currently, he is the managing director of Price Maker, a company that helps their businesses differentiate themselves from the competition by means of having a smarter pricing. He is also about to release his new book titled “Pricing for Success: The Seven-Step Plan for Winning More Customers at Better Prices”
In this episode, Mark talks about what’s written in his newest book, “Pricing for Success: The Seven-Step Plan for Winning More Customers at Better Prices”. He shares the fundamental ideas behind the seven steps and gives insightful sample situations in which the seven steps can be applied.
Why you have to check out today’s podcast:
- Get a general idea of what’s in Mark’s new book, Pricing for Success: The Seven-Step Plan for Winning More Customers at Better Prices
- Learn why it’s okay to have multiple pricing models on a single product
- Find out why it is the best time for you to raise your prices
“Take the time to do your pricing strategy properly, and put your prices up because it is the most powerful lever you can use to increase profitable growth.”
– Mark Peacock
Topics Covered:
01:27 – How Mark got into pricing
02:35 – The reason why Mark wrote his book, “Pricing for Success: The Seven-Step Plan for Winning More Customers at Better Prices”
03:42 – Step 1: Where do you want to go?
06:43 – Step 2: Know what your customers think about you
08:02 – Step 3: Being aware of your competition
11:02 – Step 4: Product
13:13 – Step 5: Pricing
15:45 – Mark Peacock’s thoughts on having more than one pricing model for a product
17:17 – Step 6: Proposition
19:21 – Mark Peacock’s favorite behavioral economics example
22:47 – Step 7: Profit
24:53 – How Mark would address the issue of credit grabbing among departments in cases of sales improvement
28:59 – Mark’s pricing advice
30:09 – Connect with Mark Peacock
Key Takeaways:
“Pricing, ultimately, is always a subset of business strategy, of your company goals. So, you've got to be clear. You got to know where you want to get to. Otherwise, you'll end up floundering with your pricing.” – Mark Peacock
“Product and price are two sides of the same coin. When I buy products for a price, I want to know what I get as a customer and equally as a seller, you need to know everything that's included in your product offering.” – Mark Peacock
“Without changing the pricing, you can achieve an effective increase in prices of 4% by changing how you present the prices. And I think this whole question of how we present pricing is just as important as ‘What's the number? What's the strategy?’ Because it makes such a difference.” – Mark Peacock
“Having a clearly written pricing policy is such an important thing. And I literally say in my book, ‘Write it down’. And it doesn't have to be long, it doesn't have to be complicated.” – Mark Peacock
People / Resources Mentioned:
-
Pricing for Success: The Seven-Step Plan for Winning More Customers at Better Prices – https://www.barnesandnoble.com/w/pricing-for-success-mark-peacock/1142840523
-
Selling Value: How to Win More Deals at Higher Prices – https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217
Connect with Mark Peacock:
- LinkedIn: https://www.linkedin.com/in/mark-peacock-the-pricing-coach/
- Email: mark@pricemaker.co.uk
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on November 30, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/thoughts-on-black-friday-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is the 10 of Hearts from the Selling Value card deck.
You and your buyer have to work together if you truly want to know how much value is there.
Face it, you know a lot about your product, but you don't really know the buyer's situation. You don't know how much revenue they make. You don't know how much money they're losing because they're solving, or haven't solved a specific problem. You don't know how bad that problem is. In order for you to figure out how much value they're going to get, you need a lot of information from that buyer.
On the other hand, the buyer has no idea how much value they're going to get either because they've probably never bought something like your product before. They've not worked with many different customers and seen the different applications and the different problems, and they probably haven't thought through all of the sub-problems that you can solve.
And so, if together we work trying to figure out what is the true value of our product, then we feel better because we now understand we're helping them make a really good decision. They feel better because they're trying to decide, is this a place where I want to spend my resources or should I spend them someplace else? Or maybe the person you're talking to has to create a business case to be able to sell it higher in the organization.
In all of these cases, it makes so much sense for both of us to understand the value of solving their problems, and that only happens when we work together.
We hope you enjoyed this example of pricing table topics. If you want to get better at speaking, especially about pricing and value, grab a deck of our cards, pull a random card, read the saying, and then talk for one to two minutes about what that card says.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Nikhil Kotcharlakota is a civil engineer by profession. He worked for Electrolux for eight years where he was head of pricing for almost two years. Currently, he is a co-founder of PriceOps, a company that aims to provide an all-in-one pricing solution for SaaS companies.
In this episode, Nikhil talks about how his experience at Electrolux changed the way he looked at pricing. He also discusses about his company, PriceOps, and how they aim to provide a complete, optimized pricing solution to SaaS companies using different pricing models.
Why you have to check out today’s podcast:
- Learn how usage data can be utilized to optimize billing and pricing
- Discover the possibility of SaaS companies effectively using outcome-based pricing models
- Learn the difference between per-user model and per active user model and when to use them
“Having the focus on price and getting value out of what you're offering is a very important thing.”
– Nikhil Kotcharlakota
Topics Covered:
01:30 – How Nikhil got into pricing
03:01 – The work that Nikhil’s company, PriceOps does
05:59 – How PriceOps plans to utilize usage data for billing and pricing
07:05 – PriceOps’ biggest challenge: using outcome-based pricing model for SaaS companies
11:19 – The other pricing models that PriceOps is eyeing besides usage-based and outcome-based
12:24 – How PriceOps aims to recommend whether to use per-user model or per active user model
15:12 – What Nikhil learned as he shifted from traditional pricing to subscription-based pricing
18:38 – Why Nikhil loves pricing operations
20:17 – Without execution, pricing strategy does not matter
20:50 – Nikhil’s pricing advice
22:02 – The revenue point at which businesses should hire a pricing person
23:54 – Connect with Nikhil Kotcharlakota
Key Takeaways:
“The best part about pricing is it's always at the center of the strategy or you'll get to work with a lot of teams; product management, sales, accounting, finance, I mean, literally every team in the company.” – Nikhil Kotcharlakota
“Companies have realized the consumer is king. So, they're trying to build an experience for the consumer so they continue to buy the same product over and over again.” – Nikhil Kotcharlakota
“If the operations are not set up properly or if there are no processes for the pricing team, a strategy might be there, but they may not be able to execute on the strategy, which will then result in loss in price or price leakage.” – Nikhil Kotcharlakota
People / Resources Mentioned:
- PriceOps: https://www.linkedin.com/company/priceops/
- Win, Keep, Grow: How to Price and Package to Accelerate Your Subscription Business: https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784
Connect with Nikhil Kotcharlakota:
- LinkedIn: https://www.linkedin.com/in/nikhilkotcharlakota/
- Email: nikhil@priceops.net
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on November 23, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-skills-for-subscriptions/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is the 10 of Spades from the Selling Value card deck.
Yes, we never want to mention competitors until our buyers bring them up because our buyers are on a trust journey, or at least we want to assume that they are.
A trust journey is where they've come to you to ask you for help figuring out, is this really a place I should be spending my resource? Is this worth the inherent value that I'm going to get when I solve the problems that I have? And what's really important when our buyers are on this trust journey is they're not saying, how are you different from your competition? They're saying, how is it that you helped solve my problem?
What we want to talk to them about during this trust journey phase is, hey, what problem are you trying to solve? What's the value of solving that problem? In essence, we're helping them build a business case for why they want to make a decision like this. And we never mention competition because it's possible they don't know that our competitors exist. It's possible that in the act of helping them build that business case, they learn to trust us so much they just want to buy from us. They're not price-sensitive at that point in time.
So, the rule really needs to be, we only talk about inherent value or the value of solving the problem until a buyer tells us they're looking at competitive alternatives.
We hope you enjoyed this example of Pricing Table Topics. If you want to get better at speaking, especially about pricing and value, grab a deck of our cards, pull out a random card, read the saying, and then talk for one to two minutes about what that card says.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Steven Forth is a Partner in Ibbaka, a strategic pricing advisory firm. He was CEO of LeveragePoint Innovations Inc., a SaaS business designed to help companies create and capture value. Steven is what I consider one of the great pricing thinkers in our industry.
In this episode, Steven shares Ibbaka’s approach on raising prices, especially during inflation, as he discusses what’s expected to happen in the pricing world next year, given all the events that’s been around this 2022.
Why you have to check out today’s podcast:
- Find out why you should first segment your customers and treat them differently before you raise your prices;
- Learn how to approach a price increase, especially during inflation; and
- Discover what’s possible to happen in the pricing world in 2023, especially with concerns of inflation and recession around
“Learn how to build value models, and connect them to prices.”
– Steven Forth
Topics Covered:
01:18 – Steven’s perspective on whether people should be thinking about raising prices now, along with questions to ask before you do so
04:59 – What Mark teaches his clients vs. Ibbaka’s approach in raising prices
09:31 – Discussion around an inaccurate representation of inflation, especially in SaaS
12:40 – “Pricing is a game that plays out over time, and you always want to make sure you’re thinking three to five moves ahead. If you don’t, you’re going to hurt yourself.”
16:16 – Taking a look at (1) the people you sell to, (2) how recession affects prices, and (3) the finance industry
20:53 – What’s happening right now? What is going to be different in 2023?
26:43 – Steven’s pricing advice
Key Takeaways:
“There may be opportunities to raise prices, but it needs to be surgical, not broad brush. And before one raises prices, one has to ask a series of questions, beginning with what is inflation doing to my customers? And is inflation making my offer more valuable to my customers? Because if it is, then you have a great reason to raise prices. But if my customers are getting in trouble and are becoming more cost conscious because of inflation, then broad brush price increases can backfire.” – Steven Forth
“I think the first thing you do before you raise prices is segment your customers and treat them differently.” – Steven Forth
“Pricing is a game that plays out over time, and you always want to make sure you're thinking three to five moves ahead. And if you don't, you're going to hurt yourself.” – Steven Forth
“When we hear the word inflation, we're thinking mostly about the CPI. The CPI is not what is most relevant to business. And you have to look at how inflation is impacting your customers and even your customers’ customers in order to make the right pricing.” – Steven Forth
“If you don't have a data model that you can apply A.I. to, you are going to lose.” – Steven Forth
People / Resources Mentioned:
- Ibbaka: https://www.ibbaka.com/
Connect with Steven Forth:
- LinkedIn: https://www.linkedin.com/in/stevenforth/
- Email: steven@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on November 16, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/an-e-commerce-price-segmentation/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Diamonds from the Selling Value card deck.
It's true, you need to sell like you don't have competitors. Every once in a while, you find yourself in a situation where people aren't looking at your competitive alternative, and you don't want to bring it up to them.
You may recall at this point in time that they're making a 'will I' decision, remember the 'will I' versus 'which one', and when people are making the 'will I' decision, 'Am I going to buy something in this product category?', they're not price sensitive.
And so, it just makes sense for us to not talk about our competition because if they say yes to us and never consider a competitive alternative, they're not going to negotiate as hard on price. They're simply looking at what's the inherent value of solving the problem, not what's the value of your product relative to a competitor's product.
So, it just makes all the sense in the world to not even mention a competitor until the buyer has already brought them up.
We hope you enjoy this example of Pricing Table Topics. If you want to get better at speaking, especially about pricing and value, grab a deck of our cards, pull a random card and read the saying, talk for one to two minutes about what that card says.
And if you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Kirk Bowman is the founder and Visionary of Value and the Art of Value, a pricing consultancy in Dallas, TX. His podcast, the Art of Value Show, is one of the most shows for knowledge professionals. He has spoken at numeration conferences on pricing including QuickBooks Connect and Scaling New Heights. In 2011, he was appointed a Practicing Fellow at the VeraSage Institute, the think tank founded by Ron Baker. His software company, MightyData, was featured in the book Implementing Value Pricing.
In this episode, Kirk talks about value pricing, how he was introduced to it and later switched to this method in estimating and billing customers. Be inspired as he shares how this decision increased his revenue by over 50% in the first year and 70% in the second. Learn this and more in his journey on value pricing.
Why you have to check out today’s podcast:
- Find out how Kirk learned about the concept of value pricing
- Identify the two categories in measuring results
- Find out details about Kirk’s pricing consultancy company and his podcast
“The next time the customer asks for a lower price, turn around and ask them what value they are willing to do without in order to get that price.”– Kirk Bowman
Topics Covered:
01:36 – How Kirk discovered value pricing
03:40 – The concept of value pricing and how it aligns the interests of the professional with his customer
07:13 – Two categories in measuring value: results or outcomes, and how the two differ
12:11 – Sharing the profile of his pricing consultancy company – Art of Value and how it is helping professionals with their business models
14:32 – His podcast – Art of Value and the reason he loves doing it
19:37 – His pricing advice that has a significant impact
Key Takeaways:
“The customer’s interests are the most important thing. When you align with that, you’re lining things up for success.” – Kirk Bowman
“It’s so important to put alignment upfront as one of the things that you’re striving for and keep your eye on at all times because it is in our human nature to focus on our own self-interest and so the focus on theirs, it requires intentionality. It requires strong character.” – Kirk Bowman
“Value and pricing are subjective, and by the way, that’s okay.” – Kirk Bowman
Connect with Kirk Bowman:
- LinkedIn: https://www.linkedin.com/in/kirkbowman/
- Website: https://artofvalue.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on November 9, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/what-selling-value-means/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Kyle Poyar is a product-led growth expert who worked for Simon-Kucher & Partners for six years where he was a consultant, senior consultant and manager, and director. Currently, he is the operating partner of OpenView, a firm that helps build software companies into market leaders by helping them hire the best talents, acquire and retrain the right customers, and partner with industry leaders so that they can dominate their markets.
In this episode, Kyle talks us through the details of product-led growth and how it became popular in the recent years. He also shares some tips on how to make it work on businesses in certain industries.
Why you have to check out today’s podcast:
- Learn the definition of Product-Led Growth
- Find out if Product-Led Growth model is suitable for your business
- Learn how to shift from Sales-led model to Product-led model
“With the reverse trial, your customers land in a premium version of your product, have a time-limited period that they can access it, and then they can either convert and essentially purchase, or they can keep using a free version of the product. What ends up happening is you get the best of both worlds between freemium and free trial, and so you don't actually have to choose between the two”
– Kyle Poyar
Topics Covered:
01:17 – How Kyle got into pricing
03:04 – More than just about numbers pricing has qualitative aspects as well
04:12 – What is product-led growth?
06:50 – Product-led growth is more than just prioritizing product over sales and marketing people
08:17 – Most companies strategized product-led growth from scratch until it was standardized
10:04 – Can companies do freemium that is not product-led growth?
11:47 – When product-led companies bring salespeople into the process
14:49 – Salespeople in product-led companies are not prospecting
15:28 – Self-serve sales work most of the time, but some transactions require salespeople
18:40 – The types of companies that does and doesn’t work for product-led growth
22:26 – How Kyle would coach a sales-led company who wants to shift to product-led growth model
25:50 – Does it make sense for PLG companies to spend more on the expand side of “land and expand”?
27:07 – Kyle’ pricing advice
28:33 – Connect with Kyle
Key Takeaways:
“In my mind, why product-led growth has taken off is because end users, as opposed to just executive buyers, have more and more power in bringing software into work. And so, you can actually make your product discovered by those users, show value to those folks and enable them to become champions in your buying process” – Kyle Poyar
“Freemium is a subset of PLG. If you're doing freemium by default, you're taking steps into product led growth. But freemium isn't required to be a product-led company by any means.” – Kyle Poyar
“I advise companies to think in terms of where there's the most friction in their current motion and what are product-led solutions that can help solve that friction and improve upon a KPI that we want to improve on right now, and that takes us on this path to doing more PLG in the future.” – Kyle Poyar
Connect with Kyle Poyar:
- LinkedIn: https://www.linkedin.com/in/kyle-poyar/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on November 2, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-fabulous-new-behavioral-economics-trick/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Clubs from the Selling Value card deck.
It's true, price doesn't drive the 'will I' decision. When people are making a 'will I' decision they're trying to decide, is this a place where I should spend my resources?
And although you can imagine if I make a huge change in price, I could get somebody to change their mind in terms of, will they buy in this product category or not. But most of the time that's not what's driving the decision.
For example, are you in the market to buy a new car today? I'm guessing the answer is no. But what if you have an accident and your car is totaled? Well, all of a sudden, you're in the market for a new car. And it isn't the price. If we lowered the price, we raised the price, that wasn't driving your decision. It was the fact that the need came up. You realized the need, and it was a really important problem.
Are you in the market to buy a new refrigerator? Probably not. What if your refrigerator breaks down?
Almost everything we can go through this same example where you're not in the market to go buy something, until of course something happens to prompt you to say, hey, I'd really like one of those, and then you can go shopping for which one you want to go buy. But in the beginning, it's not the price.
And so small changes in price really don't change anybody's mind in terms of, am I going to go buy something in this product category?
We hope you enjoyed this example of Pricing Table Topics. If you want to get better at speaking, especially about pricing and value, grab a deck of our cards, pull a random card and read the saying, then talk for one to two minutes about what the card says.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ankur Barot started his career in engineering and soon transitioned to business. Currently, he is an e-commerce expert and is working as the manager of strategic initiatives at BigBasket, one of the biggest online grocery platforms in India.
In this episode, Ankur talks to us about the important strategies when it comes to pricing in the world of e-commerce. He shares valuable tips on how to make customers choose your platform over your competitors’, and how to charge different prices on different customers depending on their buying behavior and your competitors’ prices.
Why you have to check out today’s podcast:
- Find out the factors to consider in pricing your products in the online market
- Learn how to make customers choose your platform over your competitors’ platforms
- Discover how to charge different prices on different customers by monitoring their buying behavior and your competitors’ prices
“In pricing, it is definitely very important considering how your costs are aligned and how the competitive prices align. A large part is also on how you are communicating the price to customers.”
– Ankur Barot
Topics Covered:
01:32 – How Ankur got into pricing
02:17 – The work that BigBasket does, and what makes it unique
04:29 – COVID gave the companies that did delivery a chance to explode in growth
05:54 – Ability to shop in stores again did not stop customers from ordering online
06:39 – COVID was almost like a forced trial where people had to order online; and they found it to be easier and more convenient
08:11 – Promotions and other factors that determine whether customers will place an order on your platform or not
11:21 – How to get customers to order on your platform instead of your competitor’s platform
16:12 – Analyze how much your customers are willing to pay for a product; Make sure the customers would get what they want even right before the billing process
20:05 – How to charge different prices to different customers by monitoring their buying behavior as well as the competitors’ prices
23:29 – How companies in India find the prices of their competitors’ products
27:02 – Ankur’s pricing advice
29:36 – Connect with Ankur
Key Takeaways:
“We learned that pricing plus the stock availability as well as assortment, as well as how you are charging the convenience fee – all these aspects will decide whether the customer is placing an order on your platform or not.” – Ankur Barot
“It is not about only the product pricing that the e-commerce portal has, it is what other parts of the chain that will bring in a customer and place an order on your platform.” – Ankur Barot
“At the back end, what the company or what we are trying to do is select our key value items that the customer will remember the prices for, and we’ll definitely build a long-term perspective that they are the cheapest among all the competitors.” – Ankur Barot
People / Resources Mentioned:
- BigBasket: https://www.bigbasket.com/
Connect with Ankur Barot:
- LinkedIn: https://www.linkedin.com/in/ankurbarot/
- Email: ankurbarot19@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on October 26, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/more-lessons-from-netflix/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is the Jack of Hearts from the Selling Value card deck.
It's true, buyers making the 'will I' decision do need different information than those making the 'which one' decision.
In the 'will I' decision, they're trying to decide, should I buy something in this product category or not? What they're really saying is, is this a place I should spend my budget? Or you could think of this as, how big is the problem I'm going to solve, should I spend these resources to go solve this problem? And that's the information they want to know is, what's the value of solving this problem?
Once they've said, yes, that seems like a good place to spend my money. Then they move on to making a 'which one' decision. Should I buy your product or should I buy a competitor's product?
When they're making this 'which one' decision, they're now looking at the differences of the products, the features, and in fact, they're trying to estimate how much value is that feature for that one more expensive product. I often like to think what they're really asking is, is the more expensive product worth it? So, when buyers are making the 'which one' decision, they're actually looking at the differentiation of our products.
So, it's true, buyers making the 'will I' decision do need different information than buyers making the 'which one' decision.
We hope you enjoyed this example of Pricing Table Topics. If you want to get better at speaking, specifically about pricing and value, grab a deck of our cards, pull a random card, read the saying, and then talk for one to two minutes about what that card says.
If you have any questions or feedback, please email me, mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Stephan Liozu is the Founder of Value Innoruption Advisors, a boutique consulting firm specializing in disruptive approaches in value, pricing, and strategic management. He helps leaders in organizations that want to get started in pricing by conducting assessments and building road maps.
In this episode, learn all about value pricing and how to use the right pricing toolbox to come up with a price based on how much a customer believes a product is worth.
Why you have to check out today’s podcast:
- Discover why value-based pricing is the most neglected step in understanding price
- Learn how to communicate product value in value conversations with customers before products are made for better pricing
- Find out the importance of having a pricing strategy to determine a product’s value
“Critical problems are around value. Pricing comes later.”
– Stephan Liozu
Topics Covered:
01:01 - How Stephan got into Pricing: having been named ACP deployment officer for Owens Corning Europe taking care of the pricing module in SAP
02:37 - The role of a chief value officer: Being the chief conductor of all the value and pricing activity in an organization.
05:50 - The whole process of measuring value, creating, and capturing it using the dollarization methodology
07:39 - Going through value creation: looking at the customer problem, do a better job of understanding the customer problem, uncovering it through market research, insights, and ethnographic research
09:14 - ‘99% of businesses are there to create value, oftentimes they don't know what value really means.’ Stephan's thoughts on it.
13:40 - Conversations put your customers at ease. Stephan's perspective about value conversation and the challenge that goes with it.
16:30 - Why do companies don't understand what product value is? Stephan states the three reasons why.
17:58 - Why is it important to ask the right questions?
19:18 - Customer segmentation is an often-neglected part of a value conversation. Another reason why companies don't think about value.
19:54 - What Stephan is up to these days: leveraging technology to a lot of his work focusing on monetization of software and data.
21:03 - Hardware product companies are giving away the software as a way to sell their hardware. We hear Stephan's idea about it.
22:32 - Talking about cost and value in SaaS companies. The challenge of communicating the value of its product.
24:49 - He couldn't care less about focusing more on the value of a product. His one pricing advice that could impact your business.
Key Takeaways:
“Our competitors are also looking at the customer problem. So, we got to do a better job at understanding the customer problem, uncovering it through market research, insights, ethnographic research.” - Stephan Liozu
“I wanted not to be a CPO chief pricing officer, I wanted to be a CVO chief value officer, because our critical problems are around value, you know, pricing comes later.” - Stephan Liozu
“Psychologically it puts your customers at ease when you have a conversation, whether it's in creation mode, in quantification, validation, and communication.” - Stephan Liozu
“To be doing the work in value, you have to have value conversations.” - Stephan Liozu
“If we have to continue doing everything in finance around the product, then we're not going to achieve our goal to show the value of everything else we do in the bundle.” - Stephan Liozu
People / Resources Mentioned:
- Ron Baker: https://impactpricing.com/podcast/ep44-ronald-j-baker-trash-the-timesheet-exploring-opportunities-in-subscription-businesses/
Connect with Stephan Liozu:
- LinkedIn: https://www.linkedin.com/in/stephanliozu/
- Website: http://stephanliozu.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on October 19, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-and-price-for-a-few-customers/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Andy Paul is the author of Sell Without Selling Out. He's the host of the Sales Enablement Podcast, and has experience on being VP of Business Development and VP of Sales.
In this episode, Andy talks about the importance of the “human element” and why we should utilize it more when it comes to business negotiations
Why you have to check out today’s podcast:
- Learn how automated business sequences negatively affects your business
- Understand the importance of having the “human element” in business negotiations
- Find out why you should hire actual negotiation experts and not salespeople when it comes to price negotiations
“Managers, take responsibility. Don't put the discounting in the hands of the sellers. And if managers show a little more discipline, then they can preserve the margins better.”
– Andy Paul
Topics Covered:
02:35 – The time Andy learned that pricing is important in the world of sales
06:02 – Selling is about listening to your customers and finding ways to help them
08:37 – How you should communicate value to a customer to make a successful sales meeting
13:28 – Making your customers feel understood is one step in winning sales
17:07 – Why salespeople are unable to utilize the human element
19:20 – Automated selling sequences is mostly persuasive, which is not the best way to go in sales
20:50 – Salespeople’s job is to build one on one relationships with customers, as all customers are not the same
22:30 – How salespeople should handle price segmentations or price negotiations
25:25 – Have professional contract negotiators handle negotiations, and you’ll end up getting better deals
29:11 – Andy’s pricing advice
Key Takeaways:
“I say sales, what you have to think about is your job as a salesperson is really nothing more than listening to your buyer, understanding the things that are most important to them in terms of the challenges they face and the outcomes they want to achieve by addressing those challenges and then helping them get that. That's your job. Listen and help.” – Andy Paul
“If you can be the first to make the buyer feel understood, there are serious milestones happening that you can actually put yourself in the pole position, and win the deal at a higher frequency than your competitors.” – Andy Paul
“When humanity becomes the differentiator and all the automated buying experiences start to become more similar, how do you stand apart? Being human.” – Andy Paul
“Everyone wants to point the finger at salespeople as to be the blame for discounting. And the fault is really managers. It's not salespeople.” – Andy Paul
People / Resources Mentioned:
- How to Sell Without Selling out: https://www.amazon.com/Sell-Without-Selling-Out-Success/dp/1989603572
- Humans are Underrated: https://www.amazon.com/Humans-Are-Underrated-Achievers-Brilliant/dp/0143108379
- Talent is Overrated: https://www.amazon.com/Talent-Overrated-Separates-World-Class-Performers/dp/1591842948
- Geoffrey Colvin: https://geoffcolvin.com/
- Toastmasters: https://www.toastmasters.org/
Connect with Andy Paul:
- LinkedIn: https://www.linkedin.com/in/realandypaul/
- Website: https://www.andypaul.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on October 12, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-strategic-hot-dog/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Jack of Spades from the Selling Value card deck.
Buyers usually make a 'will I' decision, then decide 'which one'.
They make the 'will I' decision, meaning, am I going to buy something in the product category? Am I going to buy a new car? Am I going to buy a new guitar? Am I going to buy a new refrigerator? Am I going to go out to dinner tonight? Am I going to hire a consultant?
We make this 'will I' decision, and then after we've said, yes, I need a - you pick it - I need to hire a consultant, then we decide 'which one'.
We interview several different consultants. We get bids from them. We see which ones we get along with. But then we're making that ‘which one’ decision.
And it's very important for our sales people, our marketing people, even our product people, to understand the difference between these two questions because when buyers are making these two decisions, they're using different information and they care about different things.
Oh, and from my perspective, the price sensitivity changes dramatically and they become much more price sensitive when they move to the 'which one' decision.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Marina Dias has been in the pricing industry for almost ten years. Currently, she is the senior pricing expert and consultant at Competera, a company that helps retailers and brands to increase customer trust by setting and maintaining optimal prices in real-time.
In this episode, Marina explains why constant communication with clients is essential in creating pricing strategies. She also enlightens us on the concept of price elasticity, and why understanding it is especially important in this time of inflation.
Why you have to check out today’s podcast:
- Learn the importance of having constant communication with your client about pricing strategies despite the widespread of AI and pricing software
- Understand the concept of price elasticity
- Find out how you could adjust your prices in this age of inflation
“Think about governance; and don’t forget that pricing, at the end of the day, is about people – our customers, our colleagues, and our internal resources of an organization.”
– Marina Dias
Topics Covered:
01:01 – How Marina got into pricing
02:58 – Why more than just dealing with numbers, pricing is an art
07:12 – Why talking to clients about pricing strategies is still important despite the widespread of AI and “black box” pricing software
10:35 – Competera‘s advice to their clients with regards to dealing with inflation
14:06 – Pricing shall be focused on experience at all times, but pricing strategy and processes are critical in this time of inflation
16:15 – Defining price elasticity and the different factors that affect it
19:37 – Understanding elasticity, and how it plays a vital role in a company’s decision making
23:21 – Pricing table topics: “Don’t raise prices on subscribers who aren’t using the product.”
27:09 – Marina’s pricing advice
Key Takeaways:
“I would say that we cannot apply stoicism when we are working at our daily business, because it's something that if we forget about the things that we cannot control, they will control us.” – Marina Dias
“People migrate between brands. People migrate between competitors. People have the decision at the end of the day, but we have the power to influence. It's one of the variables that we cannot control, of course. It's our costumers’ behavior, but we have the power to influence this through pricing.” – Marina Dias
“At the end of the day, elasticity… it's only a number. But it can help us to drive to have scenarios in our hands and to be able to support our decision making.” – Marina Dias
People / Resources Mentioned:
- Competera: https://competera.net/
Connect with Marina Dias:
- LinkedIn: https://www.linkedin.com/in/marinandias/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on October 5, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/raise-prices-now/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Diamonds from the Selling Value card deck.
It's true, buyers are using inherent value or relative value. This is how they think about the decision that they're making. And salespeople's job should be to help buyers make that decision so we should understand what's the decision a buyer is making. What's the information they need at any given point in time?
Well, inherent value is the value of solving a problem. Do I need to buy a new car? Do I need to buy a guitar? Do I need to buy a new dishwasher, a new refrigerator? Do I need to buy a pencil, a new software application? This is the inherent value, what's the value of solving the problem?
So why might I need a new car? Because I just crashed mine. Or it just broke down. Or it's getting old. Or I just got a job where my image is really important. These are all great reasons why I might need to buy a new car. And these are inherent value. Are we thinking about the way our buyers are thinking through do I need to buy one of these or not?
Oftentimes after they said yes, then they go into relative value. And relative value is, how is your product better than a competitor's product, or different than a competitor's product? What does it do? How does it behave? So, we start thinking of relative value as comparing different alternatives.
Our buyers are truly thinking in those two different ways even if they can't articulate it. As salespeople, we should make sure we understand that so we can help buyers make the best decision for them and for us.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts around value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Annie Sarnblad has a Masters in Cultural Anthropology. She is certified in Facial Action Coding and can numerically code the 10,000 muscle combinations in human expression. With this skill, Annie has been helping companies to make informed decisions. Besides her corporate clients, Annie also helps high-profile families with heightened security needs, individuals navigating charged political situations, educators, peace mediators, medical professionals, and others.
In this episode, Annie talks about the importance of understanding microexpressions in business. She also discusses some of the most observable expressions that would enable business people to assess the situation properly and make necessary adjustments when needed.
Why you have to check out today’s podcast:
- Learn about the science behind facial microexpressions
- Discover how understanding facial microexpressions could help you in your business
- Acquire knowledge about the most common microexpressions and how to capitalize on them when you are in a business meeting
“My piece of advice is for any business to recognize the importance that pricing can play in reaching their growth targets and objectives and making sure that they recognize that pricing has to be rooted in value.”
– Annie Sarnblad
Topics Covered:
01:42 – Annie explains her skill of being a “human lie detector”
04:11 – The science behind reading facial microexpressions
08:32 – You have no control over facial microexpressions; it just shows
12:19 – No one can really just “smile” for the camera, except when they are actually happy
14:04 – Annie doesn’t remember static faces, only the muscle movements
18:43 – Observing the pupil is the easiest to learn because we are already looking at the eyes
22:02 – Why Annie wanted to learn how to read microexpressions
24:30 – Always look out for “disgust” or the “no” face when you are in a meeting
26:16 – Seeing the “no” face means that you have a choice to make
28:57 – How simply looking for pupil dilation could help you pivot from one topic to another and increase your price
31:05 – Annie’s pricing advice
Key Takeaways:
“Muscle movement precedes the thought process. Even somebody like me that's hyper-trained and thinks about this 24/7, I can't stop myself from making the micro expressions unless I change my thought patterns and think about something else.” – Annie Sarnblad
“Nobody's ever felt cheerful when they get an order to smile.” – Annie Sarnblad
“If we're building strategy, we can have incredibly intelligent, high-level strategic brains and know the business, know the industry, know the players. But if we're not understanding how the players are interacting with each other, what their primary motivations are, what's in it for them, if we don't understand what's under the surface, we're basing our strategy on the wrong things.” – Annie Sarnblad
“Once people have a vocabulary for the stuff that they see all the time, they then can have a much higher-level conversation.” – Annie Sarnblad
“I think people just are so rushed to get everything closed immediately that they sometimes don't use all the information that's available to them to make good choices.” – Annie Sarnblad
Connect with Annie Sarnblad:
- LinkedIn: https://www.linkedin.com/in/annie-sarnblad/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on September 28, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/reading-buyers-minds/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Clubs from the Selling Value card deck.
Customers' perception of value is their reality. This is absolutely true.
Think about when you purchase something. You don't have the time or the energy to go out and learn everything there is to possibly know about everything. In fact, if you're like me, you've probably purchased things, and made a mistake, "Oh, this really didn't solve the problem I thought it was going to solve. It really didn't look the way I thought it was going to look or act the way I thought it was going to act."
And what that really meant was that before we bought the product, we had this perception of what we thought the product would do, and it didn't live up to that. The 'didn't live up to that' is true reality. This is what it really does. But prior to the purchase, the only thing that mattered was what we believe.
And this is true of our customers as well. Prior to them making a purchase decision, all they can do is use what they believe to be true as information to make the decision. We need to understand that because our job, if we're selling value, is to make sure their perception of our value is really high.
Ideally, we make sure it's accurate, but we want to make sure it's high.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Kiran Gange is the CEO and Founder of RapidPricer, a company that helps automate pricing and promotions for retailers. He helps companies grow internationally, especially into India. And he was a Senior Strategy Analyst at Fry’s Electronics.
In this episode, Kiran educates us on retail and analytics-based pricing as he shares hypotheses and strategies you can practice in pricing your own products.
Why you have to check out today’s podcast:
- Learn how to price retail products both in B2B and B2C setting
- Understand why you should increase your price in phases and not shock your customer at once
- Find out how important analytics-based pricing in, and discover strategies on how you can actually do it in your business
“Look at your past data. Use your intuition to guide the data analysis, but don’t only base your decision on intuition.”
– Kiran Gange
Topics Covered:
01:31 – How Kiran got into pricing
02:36 – Pricing in both the environments of B2B and B2C in retail
05:07 – A hypothesis to test for foot traffic and cameras
07:13 – Talking about the work that RapidPricer does
11:15 – The strategy on how to rapidly change prices, and the difference between base price and promoted price
14:00 – The difference between AI and a strategically thought-out programming
17:06 – Discussion around analytics-based pricing frameworks, and Mark’s ‘which one’ and ‘will I’ concept
21:01 – Using AI to know which products people are price sensitive on
22:09 – Pricing table topics: “Execute price increases in phases; test the outcomes.”
24:08 – Kiran’s pricing advice
Key Takeaways:
“There’s a difference between a base price and a promoted price. The base price is when you decide what is the right price to keep inside your store for a longer time. A promotion is an instant decision, typically to correct something which is a negative factor.” – Kiran Gange
“Customers don't like prices changing up on them instantly.” – Kiran Gange
“Strategy is always the foundation behind how the prices should be done. It shouldn't be an entirely “I have no clue what's happening. Here’s the price. Here you go. Cancel the black box.” Ever. I believe, at least retailers are so traditional; they won't accept a solution like that.” – Kiran Gange
“You need to know which products are people sensitive about and make sure they get the best value on those products to compete on those products. And the others can be your profit drivers.” – Kiran Gange
“Whenever you have this cost increases, have like a strategy to understand which products are going to absorb the cost over time and which products can take it immediately. That will help you both stay up to date with your latest cost and not upset your customers too much.” – Kiran Gange
People / Resources Mentioned:
- RapidPricer: https://www.rapidpricer.com/
- Fry’s Electronics: https://www.youtube.com/fryselectronics
- DemandTec: https://www.demandtec.com/
- Amazon: https://www.amazon.com/
Connect with Kiran Gange:
- LinkedIn: https://www.linkedin.com/in/kirangange/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on September 21, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-based-prospecting/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Hearts from the Selling Value card deck.
Buyers who don't believe you understand their problems, won't listen to your solution.
Buyers want to trust you as a salesperson, as a company. Buyers want to trust that you understand them because if you don't understand their problems, how is it that you could possibly solve their problems?
People are buying products; they're buying solutions to problems. Our best bet is to make sure our buyers, our customers, understand that we know what their problems are. We've seen them before. We've solved them before. This makes buyers comfortable.
Well, how can we do that if all we do is show up and pitch our product? How can we do that if all we do is talk about our product?
If instead, we spend time listening, learning about what their problems really are, talking about their problems and how we've seen these problems in the past. Then they know that we know their problems, and then they're much more open to hearing our solutions to their problems.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts around value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Karen Chiang is a co-founder and managing partner of Ibbaka, a company that provides software and expertise to enable business growth by optimizing revenue performance through customer value management and talent optimization.
In this episode, Karen talks about service-led growth and its advantages over product-led growth in certain situations. She also tells us when and how to utilize it, along with the concept of collaborating with the customer throughout the journey in order to maintain and maximize the value of your product or services.
Why you have to check out today’s podcast:
- Learn the fundamentals of service-led growth
- Discover why service-led growth might be more useful to your business than product-led growth
- Find out how to maintain and maximize value by keeping in touch with your clients
“My piece of advice is for any business to recognize the importance that pricing can play in reaching their growth targets and objectives and making sure that they recognize that pricing has to be rooted in value”
– Karen Chiang
Topics Covered:
01:12 – How Karen got into pricing
01:53 – What is service-led growth?
04:09 – Product-led growth vs. service-led growth: Which one to use, and when
14:47 – Is service-led growth functional in industries other than consulting?
18:26 – How knowing the insights of your customers helps in increasing the value for your product
21:02 – The concept of customer journey in service-led growth
23:52 – The difference between product-led growth and service-led growth
26:54 – Karen’s pricing advice
28:24 – Connect with Karen Chiang
Key Takeaways:
“The reality is that not all customers are looking for product-led solutions.” – Karen Chiang
“If you are working with customers which are trying to solve complex problems, which require a more collaborative approach, then you are not in the business of product-led growth or you shouldn't choose product-led growth as your strategy. In fact, you should be looking at service-led growth.” – Karen Chiang
“Pricing is very linked, very much linked to the value that your customer cares about.” – Karen Chiang
“With service-led growth, you are not just thinking about the term of the platform once a year. You are, by nature, collaborating with your customer throughout the journey.” – Karen Chiang
People / Resources Mentioned:
- Ibbaka: https://www.ibbaka.com/
- Steven Forth: https://www.linkedin.com/in/stevenforth
Connect with Karen Chiang:
- LinkedIn: https://www.linkedin.com/in/karen-chiang-2623241/
- Email: karen@ibbaka.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on September 14, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-to-give-salespeople-discount-authority/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Queen of Spades from the Selling Value card deck.
It turns out that when we shop for something, especially if it's something that we've never owned before, we've never purchased before, we are not experts in the product. We're trying to learn as much as we can about what makes sense. What's going to be good for us. Where's the best bang for our buck. We are not experts in the product category.
And yet, if it's something that we've bought many, many times, as we become expert, then we stop thinking about what are the benefits I need to achieve and we start thinking about what are the features.
Possibly my favorite example of this is imagine buying a computer. I'm guessing you've bought many computers in your life and you understand what many of the features do for you. For example, the size of the hard disc or the size of the RAM. And when you walk into a Best Buy store and you're going to buy a new computer, when the geek says to you, "Yeah, this one does emails and photos really well." You're thinking, "Go away, I don't want to know the benefits. Tell me what's the size of the hard disc, how much RAM, where's the processor speed."
On the other hand, imagine it was your first computer. And someone walks in and says, "This is a two-gigabit processor with quad processors and two terabytes of hard disc and 256 gigabytes of memory." And you're thinking, "Is that good or not?" Because then you need the benefits.
Most of the time, if we've got a direct salesperson selling a product, we're selling to somebody who hasn't bought the product before. We're selling to somebody who isn't an expert. And what that means is we should stop talking about our features, we really need to talk about our benefits. Features are simply proof points that we can achieve the benefits.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull out a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Geraldine Carter runs She Thinks Big Coaching where she helps CPAs do less without sacrificing revenue. Although her target market are CPAs, she actually has a bachelor’s degree in civil engineering from Cornell University. She was also a cycling guide for Backroads and now hosts her own podcast called The Business Strategy for CPAs.
In this episode, she talks about the structure of pricing in the accounting industry and the reason why most CPAs are underpriced. She then discusses her so-called “effortless value” where accountants could earn more without having to do extra work. Finally, she shares her tips on how accountants could earn more by having expertise and charging their clients more.
Why you have to check out today’s podcast:
- Learn why you should have a deep expertise instead of being a generalist
- Acquire techniques on how to increase your value without doing more
- Discover the reason why charging more is better for you and your clients
“It’s good for your clients to charge them more”
– Geraldine Carter
Topics Covered:
01:33 – How Geraldine got into pricing
03:10 – The problem of pricing in the accounting industry
05:24 – What is Menu Pricing and its difference from Subscription Pricing
09:16 – CPAs are not a subscription
10:11 – How “billing” works in CPAs
11:56 – The prevailing mindset among CPAs
13:11 – Why having a deep expertise is essential in getting better prices
17:04 – The mindset that needs to be changed in the accounting industry
17:54 – What is “Effortless Value”
20:49 – Geraldine’s bicycling pricing story
24:06 – Pricing table topics: Subscriptions have three revenue buckets: win, keep, and grow. Manage all three.
27:51: Geraldine’s pricing advice
Key Takeaways:
“You can legitimately be given the marketplace and the absence of segmentation, become an expert and have expertise that the client cannot find anywhere else, either in their zip code or on the Internet. It just doesn't exist. There's so little competition that if you in fact do have deep expertise." – Geraldine Carter
“Effortless value is this idea of going through your business and looking at all the ways you could improve. You could add value to your clients experience without it being more work.” – Geraldine Carter
“Your buyers take your price as a signal of quality. And if it is not high enough for what they are expecting to pay, they will keep on walking.” – Geraldine Carter
“If your delivery is dialed in and your clients are delighted and you make good on your promise, they will continue to stay.” – Geraldine Carter
People / Resources Mentioned:
- She Thinks Big Coaching: https://geraldinecarter.com/
- Smart Strategy for CPAs: https://www.businessstrategyforcpas.com/
- Jonathan Stark: https://jonathanstark.com/
- Ron Baker: https://www.linkedin.com/in/ronbaker1/
- Selling Value: How to Win More Deals in Higher Prices: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217
Connect with Geraldine Carter:
- LinkedIn: https://www.linkedin.com/in/geraldine-carter/
- Email: gc@geraldinecarter.com
- Website: https://geraldinecarter.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on September 7, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-you-should-give-salespeople-discount-authority/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Diamonds from the Selling Value card deck.
If a salesperson doesn't believe they're going to win selling your product, they're not going to try to sell your product. They don't want to bang their head against a wall. They're going to go sell whatever happens to be easiest.
But the next step is, assuming they can sell our product, how do we get them to sell it and win at the higher prices to stop giving away deep discounts? Well, the question becomes, does a salesperson truly believe your product is worth the price?
If a salesperson has confidence that their customer is going to get so much more value than whatever the price is that we're going to charge, then they're much more likely to win at higher prices.
If a salesperson questions the amount of value customers might get, if a salesperson doesn't believe deep down in their soul that this product is a great product for their customer, then they're going to tend to discount. They're going to offer discounts and hope that the buyer says, “Yes, finally, the value that I receive is worth the price that you're asking.”
What we want is for our salespeople to go in confidently. What we really want is for our salespeople to understand the value that we deliver, truly believe the value we deliver, and be able to communicate that value to the buyer.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dor Sasson is the co-founder and CEO of Stigg, a company that helps clients grow with pricing through a software that enables them to control what can be priced and packaged separately, and make adjustments without having to do coding. He has also been a Senior Product Manager at New Relic, a technology company which develops cloud-based software to help website and application owners track the performance of their services.
In this episode, Dor shares how his experience in New Relic led him to explore the field of SaaS packaging and how his company, Stigg, aims to provide solutions to packaging problems from the developers’ end.
Why you have to check out today’s podcast:
- Pickup ideas about the adjustments to be done when switching to usage-based pricing
- Discover how Stigg could help you on your packaging and pricing problems
- Learn the importance of asking the right questions in the success of businesses
“Talk to your customers, ask them about their willingness to pay. There are amazing frameworks out there for how to ask the right questions. It will unlock immense, deep understanding of how your customers think about your pricing and will really help you to nail down your own pricing strategy.
– Dor Sasson
Topics Covered:
01:11 – How Dor got into pricing
03:59 – What is “entitlements”?
04:52 – Adjustments made by New Relic upon switching to usage-based pricing
08:09 – The work that Stigg actually does
15:48 – The difference between buyers and users
16:35 – Situations in the past where Stigg would’ve been a big help
20:51 – Dor’s vision and mission for his company, Stigg
23:49 – Pricing table topics: “Good, better, best” pricing is significantly more effective within a market segment
26:38 – Dor’s pricing advice
Key Takeaways:
“The way we like to think about Stigg is, we want to build out an infrastructure that is so easy to implement and so easy to adopt from the application side that it makes it really fast and easy for product and growth teams to introduce new pricing plans, changes in existing pricing plans.” – Dor Sasson
“The value that we unlock is for builders and growth leaders out there that are looking to use pricing as a vehicle for growth and help their companies continue to adapt to changing markets, continue to adapt to how they scale into new customer segments, and basically make sure that they give their buyers more options to use their software.” – Dor Sasson
“Our North star by the end of the day is not only helping our customers be faster in the way they introduce changes and launch new pricing but also ultimately unlock growth by allowing more flexibility for their buyers to use and consume their products.” – Dor Sasson
“There is no “one size fits all” in pricing. The first thing you got to do is understand in a very deep and thoughtful way, who are your customer segments, and good, better, best is actually a really good strategy to approach different customer segments and make sure that you build your pricing in a way that fits or is more aligned to the way each segment perceive value.” – Dor Sasson
People / Resources Mentioned:
- Stigg: https://www.stigg.io/
- New Relic: https://newrelic.com/
Connect with Dor Sasson:
- LinkedIn: https://www.linkedin.com/in/datapm/
- Twitter: https://twitter.com/DorSasson
- Website: https://www.stigg.io/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 31, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-you-should-not-give-salespeople-discount-authority/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Clubs from the Selling Value card deck.
What we really want is for our salespeople to be able to communicate the value of our products to our customers. It turns out that's so much easier to do when our marketing department has figured out and created the materials and the support to help salespeople go do that. But then marketing has to understand how is it that our customers value our products.
And this is so much easier to do, if our product people create products that truly have value to our customers so they understand the value that our customers get from our products.
It turns out very few people truly understand how much value we get, and if we want our entire company to truly think about value, to be able to communicate value, create value, capture value, the best and easiest way to do that is for the executive team to show interest about value.
And what that truly means is that executives should be asking questions, how is it that customers are going to value this new feature, this new product? How much will they value it? How is it different from our competitors and how much do they value that differentiation? What problems are we solving? What problems are we solving our competitors aren't solving?
Executives showing interest in value can help drive value to be a mindset inside the entire company.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull out a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ulrik Lehrskov-Schmidt is the partner of willingnesstopay.com where they help companies create pricing models that radically accelerates growth and unlocks the value of their underlying technology. He has founded and sold two different companies, and he has a master's degree from Harvard. He also has an upcoming book called “The Pricing Roadmap” which will be published this December.
In this episode, Ulrik enumerates four (4) things that he thinks are the most important in SaaS pricing. He also shares his methods on product segmentation and explains why the traditional “good, better, and best” product tier is lacking some important details.
Why you have to check out today’s podcast:
- Learn about designing your models as well as the structure of SaaS pricing
- Find out how different ‘tiered packaging’ is to Mark’s idea of good, better, best
- Understand what prescriptive solution is and why you should not do it
“Usually, people underestimate the pricing power they have in the market. So, I see, even if you had to do it blind, the chances that you could make more money by raising prices, even poorly, is better than what you're doing.”
– Ulrik Lehrskov-Schmidt
Topics Covered:
01:47 – How Ulrik got into pricing
05:43 – The top four things that really matter in SaaS pricing
08:22 – There are no perfect outcomes; only workable and functional outcomes
09:27 – How Ulrik does product segmentation
12:09 – What is prescriptive solution and why you should avoid it
15:19 – Ulrik’s attempt on product packaging with conjoint analysis
18:04 – What Ulrik likes about being a pricing consultant
19:45 – Ulrik’s thoughts on the three tiers of products (Good, Better, Best)
21:24 – How Ulrik actually defines the tiered packaging model
22:08 – The specifics of “Tiered Packaging”; how it's different from good, better, best
28:30 – Ulrik’s pricing advice
29:59 – Connect with Ulrik
Key Takeaways:
“If you have segments that are so different that they need different pricing models and product models, that's the first thing you need to figure out.” – Ulrik Lehrskov-Schmidt
“There are two different high level tool boxes to do price discrimination; pricing matrix and packaging. Packaging runs on functionality, and pricing metrics on some volume or usage.” – Ulrik Lehrskov-Schmidt
“There's not a perfect outcome. There is a workable outcome, functional outcome to run through. And then you might want to go back and change something if there is a better outcome to be had.” – Ulrik Lehrskov-Schmidt
People / Resources Mentioned:
- The Pricing Roadmap: https://www.willingnesstopay.com/saas-pricing-book
Connect with Ulrik Lehrskov-Schmidt:
- LinkedIn: https://www.linkedin.com/in/ulriklehrskovschmidt/
- Website: https://www.willingnesstopay.com/
- Email: ulrik@behaviouralstrategy.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on August 24, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/qdoba-knows-their-buyers-decision-journey/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Hearts from the Selling Value card deck.
It's true, value-based pricing is impossible because value-based pricing simply means charge what your customers are willing to pay. And yet you don't know how much your customers are willing to pay. You can't read their mind. You don't know the answer and you never will know the answer.
But instead of assuming we're ever going to get perfect, let's assume we can get better. We can adopt this as a mindset.
If we're thinking always about how much is our market, our customer, willing to pay. All of a sudden, we change our thinking from cost-plus, we have to cover our cost type thinking, to, could I get more from this customer? Could I get more from this marketplace?
And as we start thinking that way, we also start thinking, can I create products that deliver a little bit more value? Can I communicate my value better to my customers? Can I help my customers, or my buyers, understand that there's way more value there than they originally thought, and therefore they would be willing to pay us more money?
Once we start to understand and think about how is it that our customers value our products, then we have the ability to price and capture more of that value, meaning more profit to us.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull out a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Bryan Whittington is the founder of ebs/growth, a firm that helps companies create a more effective sales team. Also, he is the host of the Talent Sales & Scale podcast, and was a sales trainer for over ten years.
In this episode, Bryan discusses how he handles exploratory or discovery calls. He explains how he talks with his clients and potential clients in order to find the root cause of their problems, and shares some of his techniques to get these clients to propose the possible solutions to their problems themselves.
Why you have to checkout today’s podcast:
- Learn how an expert like Bryan Whittington handles discovery calls
- Acquire new techniques in scrutinizing your clients’ problems
- Discover smart ways to find a solution to your clients’ problems
“Pricing is a belief. You either believe that your price is not worth what you're asking, or you're able to convey that your price is worth it to your prospect, your buyer. But price is absolutely a belief. You choose which belief you want.”
– Bryan Whittington
Topics Covered:
01:15 – How Bryan got into pricing
02:08 – Selling value vs. selling a commodity
05:08 – What to avoid when having a discovery call
07:02 – How to handle a discovery call, step 1
09:23 – Why it is better to setup that next meeting
13:30 – How to handle a discovery call, step 2
14:19 – Why you shouldn’t allow your clients to rate their problem a 7/10
15:01 – How to handle a discovery call, step 3
17:59 – Finding out the root cause of the clients’ problems
22:54 – When and how to name the price of your solution based on the magnitude of the problem
24:46 – Pricing table topics: “Salespeople use every tool available to close a deal. When given authority to discount, they will use it more often than necessary”
28:20 – Bryan’s pricing advice
Key Takeaways:
“Sales is how you identify what their challenges are, whether or not you can solve the problem of those challenges, and then understand the value of you fixing those problems for that organization will be, and you can charge an appropriate value for it.” – Bryan Whittington
“That conversation should take anywhere between 5 to 8 minutes. And if it's longer than that, you've already started your initial first sales call, and I wouldn't suggest you do that.” – Bryan Whittington
“Often, the problem that the person brings you is never really the problem. We have to identify the real root cause to know whether or not your solution will work. If your solution won't work for that root cause, then make an introduction to somebody where it will.” – Bryan Whittington
People / Resources Mentioned:
- ebs/growth: https://ebsgrowth.com/
- Talent, Sales & Scale Podcast: https://ebsgrowth.com/podcast/
Connect with Bryan Whittington:
- LinkedIn: https://www.linkedin.com/in/brywhittington/
- Email: bryan@ebsgrowth.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 17, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/training-salespeople/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the King of Spades from the Selling Value card deck.
It's true, value-based pricing is the most profitable pricing strategy you can adopt. If you think about it, the definition of value-based pricing is charge what your customers are willing to pay. Now, that seems pretty simple, but if you knew exactly how much your customers were willing to pay, and you charged that amount, then you can't possibly make more money.
If you charge less than that amount, you end up leaving money on the table. If you charge more than that amount, your buyer doesn't buy.
So, by definition, value-based pricing is the most profitable pricing strategy you can adopt. However, it's impossible to do perfectly because there's no way that you know how much somebody is willing to pay for your product. We can't read our customer's minds.
What we can do though, is adopt this as a strategy, an attitude, a goal, and continue to do things so that we can learn more and more about our markets and our customer's willingness to pay and get to the point where we're capturing more of it each time.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate important concepts about value.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dinaz Zaq is the Director at Revenue Pricing Consultants in London, the “home of revenue management and pricing expertise” that focuses on increasing profitability through diagnostic review. Dinaz spent 20 years in Revenue Management at British Airways, and also worked for resorts, hotels, and cruise lines.
In this episode, Dinaz explains how airlines, hotels, and cruises do pricing as she shares some of the strategies they use in line with the factors that affect their pricing decisions.
Why you have to check out today’s podcast:
- Understand how most airlines, hotels, and cruises do pricing;
- Discover the strategies they use and the factors that affect their pricing decisions; and
- Find out why each employee – even the cabin crews – are important on getting customers and providing great service
“The biggest thing that you need to get right is your demand before you make any pricing decision at all.”
– Dinaz Zaq
Topics Covered:
01:32 – How Dinaz got into pricing
03:02 – How do airlines do pricing? What factors affect their pricing decisions?
10:03 – The strategy behind “I will get the best price on a domestic flight if I book it six weeks before my flight”
11:47 – The difference between pricing hotels and pricing airplane seats
14:06 – Why hotels don’t hold their prices really high for last-minute travelers
15:53 – Hotels and discounts on their rates
16:40 – What is the strategy of cruises when it comes to pricing?
20:35 – Pricing table topics: “Every employee creates or destroys value”
22:35 – Dinaz’s pricing advice
Key Takeaways:
“Things depend, really, on the strategy that the airline follows and what's the flavor of the day as far as their management is concerned.” – Dinaz Zaq
“You might get some hotels that won't drop their price. Some might even take walk ins at the door for a cheaper price. They don't want to publish it on the internet. Airlines might. It's about, you know, when we talk strategy, when you try to hold the price then drop it later, you can sell it through a different distribution channel so that it doesn't hit the public and therefore not destroy your pricing strategy.” – Dinaz Zaq
“Their strategy is to fill it to 100%, and that's why you might find cruise prices dropping near at the time quite a bit. But what the customer misses out on is you may not get your best cabin if you wait too long, because the people that are regular cruisers, they have got all the balconies and then you'd be stuck somewhere on top of the discotheque or in a noisy area or whatever.” – Dinaz Zaq
People / Resources Mentioned:
- British Airways: https://www.britishairways.com/
- STR: https://str.com/
- Marriott: https://www.marriott.com/
- Hotwire: https://www.hotwire.com/
- Priceline: https://www.priceline.com/
- Booking.com: https://www.booking.com/
- Hotels.com: https://www.hotels.com/
Connect with Dinaz Zaq:
- LinkedIn: https://www.linkedin.com/in/rpcltd/
- Email: revenuepricingconsultants@outlook.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on August 10, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/discovered-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Ace of Diamonds from the Selling Value card deck.
When companies or people inside companies say we sell a commodity, what that says to me is they don't understand the value of what they offer.
It may absolutely be true that you sell a commodity-like product where we're selling gold coins and your gold coins are exactly the same as your competitor's gold coins. And we could think of that maybe as a commodity, but then that's really not what we're selling.
What we have to sell are all the things that go around the gold coins or go around our commodity-like product. We should be thinking about what are the services? Can we do better delivery? Can we do better payment terms? Can we make our customers trust us more? Can we give them better advice? There are many, many different ways that we might be able to add value to our buyers above and beyond the individual product that we're selling.
I often think that when people are saying the words, we sell a commodity or our product is a commodity, they've actually stopped thinking about how they're better than their competition. They've stopped thinking about what their buyers really care about.
So, in my mind, there really is no such thing as a commodity and all companies should banish the word.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull out a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate these important concepts.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dominick Latorre is the Senior Director of Yield and Inventory Management at Sinclair Broadcast Group. He used to be the Manager of Pricing and Planning at Spectrum Reach, and he's the Assistant General Manager of the Men's National Team in USA Ball Hockey.
In this episode, Dominick explains how they price slots for broadcast advertisements as he relates it to how airlines do pricing for their seats.
Why you have to check out today’s podcast:
- Learn how Sinclair does pricing for perishable inventory like ads
- Understand how it’s related to how airlines price their seats
- Find out why it’s important that your sales people know how to make sure that your service is priced effectively
“It's educating yourself on different industries outside of yours and how you can take those concepts and those ideas and apply them to your business.
– Dominick Latorre
Topics Covered:
02:01 – How Dominick got into pricing
04:12 – Sinclair’s goal to improve efficiencies with the local pricing experts and revenue with pricing
06:41 – “It is not what I wanted. It's not what I wanted to buy.”
09:25 – Relating and comparing how Sinclair does pricing to how airlines price their seats
14:46 – The factors that affect how Sinclair price the programs
18:38 – Pricing for political campaigns
23:01 – Pricing table topics: “Create real value with differentiation. Create perceived value with marketing.”
25:36 – Dominick’s pricing advice
Key Takeaways:
“I'm very happy with the choice I made back in 2007-ish to get into pricing, because as obviously as you know, it's the biggest driver of profit if you're priced correctly, so much more than sales volume or anything else.” – Dominick Latorre
“With the various choices for marketing dollars these days, you can't be upsetting clients and pulling multi-million-dollar deals because we weren't priced effectively and given them a rate that from day one it should have been a premium program; obviously, the demand is there. We should be charging it based upon that.” – Dominick Latorre
“You can drive more revenue by lowering your rates, and we've seen that in some cases.” – Dominick Latorre
“We talk to our sellers all the time. Sell the value of the program. Don’t combine it with other solutions. Don't sell a customer what we call a 9A4P rotator, where basically that customer spot could fall anywhere between that time period. That’s not selling value. Look at the value of our solutions and price accordingly to them.” – Dominick Latorre
“With so many marketing solutions out there and dollars to be spent, you have to make sure that you're priced effectively. And again, talking about value, making sure that the buyers see the value in your solution.” – Dominick Latorre
People / Resources Mentioned:
- Sinclair Broadcast Group: https://sbgi.net/
- Professional Pricing Society: https://www.pricingsociety.com/
Connect with Dominick Latorre:
- LinkedIn: https://www.linkedin.com/in/dominicklatorre/
- Email: dmlatorre@sbgtv.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on August 3, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/perfect-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Ace of Clubs from the Selling Value card deck.
One of my favorite sayings when I'm teaching is, nobody cares about your product. What's fascinating is when you look at a company's website or you look at how somebody wants to talk about what it is they're going to offer you, they want to talk about their product.
I so much want to tell you, oh, I'm a pricing expert and I train people on pricing. But that's the product. What we really need to be doing is talking about the problems that our buyers have and the outcomes or the results they might be able to achieve.
Experts are able to take our features and say, oh yeah, I get what that means to me. But most of our buyers aren't experts. What we need to be able to do is instead of talking about our product, talk about the problems that our buyers might have.
I might go to a VP of sales and say, do your salespeople tend to discount too much too often? Now that's a problem. And if that resonates with this VP of sales, now we have something to talk about. But for me to walk in and say, I'm a pricing expert, and I teach salespeople how to sell value. That's all about me. And it only resonates if that person truly is an expert, and they have the problem.
So, I love to say nobody cares about your product. What we have to be doing always is thinking about our buyers' problems and the results they might achieve.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull out a random card, read the saying, and then talk for one to two minutes about what that card says. This will improve your understanding and more importantly, your ability to communicate these important concepts.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Marcos Rivera is the Founder and CEO of Pricing I/O, a training and coaching boutique helping high-growth B2B SaaS companies accelerate ARR growth and market share. Marcos was the Operating Executive for Product Management and Pricing of Vista Consulting Group, and is the author of the book “Street Pricing: A Pricing Playlist for Hip Leaders in SaaS”.
In this episode, Marcos shares his insights on some the common problems in the subscription industry. He also talks about the different ways to approach pricing adjustments in relation to software innovations, and discusses the hot topic of usage-based pricing.
Why you have to check out today’s podcast:
- Find out what the three biggest pricing problems are when it comes to subscription and know why you shouldn’t do those
- Discover why people don’t pay much attention on the expansion part of land and expand, and learn how to go for it if you want to
- Understand why it’s a good step to raise prices on the subscribers with highest usage first
“Go out there, get data, experiment and raise your confidence, and the pricing problem gets so much easier.”
– Marcos Rivera
Topics Covered:
01:32 – How Marcos got into pricing
02:33 – Biggest pricing problems in subscriptions: (1) Pricing without aligning their package of value to their clients
04:00 – Why decoupling pricing and packaging is difficult
04:47 – Enhancing your pricing when introducing software innovations
06:31 – Biggest pricing problems in subscriptions: (2) Underpricing
09:08 – Biggest pricing problems in subscriptions: (3) Overcomplexity in the model
10:55 – People not focusing on the expansion part of the commonly used phrase in SaaS, “land and expand”
14:02 – Understanding usage data in providing better value to your product
16:17 – Getting things to levels of sophistication and sophistication at scale
18:29 – Where, when, and how to utilize usage-based pricing
24:38 – Pricing table topics: “Raise prices on the subscribers with highest usage first.”
26:12 – Marcos’ pricing advice
Key Takeaways:
“The way to start with pricing, especially if you already have an existing model and you’re looking to enhance it, believe it or not, is not where most companies start, which is “how much should I charge with this new thing?” It's the first thing on their mind, the first question on their mind, but that question doesn't get answered until you understand how your value is being changed...” – Marcos Rivera
“There's nothing wrong with land and expand, but what often happens is that it's mostly land and very little expand…. When you place so many of your chips on the land part of it, you start being overly generous with your limits or overly generous of what you're including. What ends up happening is you put so much of your expansion opportunity into the land that your expand opportunities are limited. Overly heavy on the land makes it tougher to expand.” – Marcos Rivera
“Be a little bit careful about over indexing on what they're doing in the system because you don't want to inadvertently discourage them from using the product.” – Marcos Rivera
“Value is not in the people using it. The value is in the machines doing, and the volume and frequency with which it's doing it.” – Marcos Rivera
“Remember, perceived value gets stronger and better with more usage. That correlation works out really well.” – Marcos Rivera
People / Resources Mentioned:
- Pricing I/O: https://www.pricingio.com/
- Vista Consulting Group: https://vistacg.com/
- Vista Equity Partners: https://www.vistaequitypartners.com/
- Netflix: https://www.netflix.com/
- Slack: https://slack.com/
Connect with Marcos Rivera:
- LinkedIn:https://www.linkedin.com/in/marcoslrivera/
- Website:https://www.pricingio.com/
Connect with Mark Stiving:
- LinkedIn:https://www.linkedin.com/in/stiving/
- Email: mailto:mark@impactpricing.com
This is an Impact Pricing Blog published on July 27, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-table-topics/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one is the Ace of Hearts from the Selling Value card deck.
Selling value really does do a lot of things. But if you imagine for a second that a buyer has some expectation of how much value they're going to get from our product. That is a good indicator of their willingness to pay, it's a good indicator of how urgent it is that they want to solve the problem or buy the product.
But what if we had the ability to increase the amount of value that person expects to get from our product? For the sake of argument, let's say we 10x it. We make our product really valuable to them. All of a sudden, they're willing to pay more. They want it. They want it now. They want it faster.
And so, we're going to increase our average selling price, we're going to shorten the sales cycles. And of course, if they believe we're going to deliver a 10x, they're going to buy from us instead of from our competition. And once we can recognize those buyers who really are going to get a lot of value from our product, then we get better prospects as well.
So, it turns out when we can sell value, we really do increase win rates and average selling prices.
We hope you enjoyed this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull a random card, read the saying, and then talk for one to two minutes about what the card says. This will improve your understanding and more importantly, your ability to communicate important concepts.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ron Baker is the Founder of VeraSage Institute, dedicated to helping professional knowledge firms bury the billable hour and trash timesheets. He has published seven books around the topics of business and pricing, and also is a radio talk-show host for The Soul of Enterprise.
In this episode, Ron engages in a pricing metric discussion with Mark as they share their insights on cost-plus, hourly pricing, and subscriptions.
Why you have to check out today’s podcast:
- Deep dive into discussions about different pricing metrics, focusing on cost-plus, hourly, and subscriptions
- Find out why putting time in your service and charging by the hour isn’t an ideal way to charge clients
- Understand why providing value is better than charging hourly or using cost-plus pricing
“There's always going to be people and businesses that use cost-plus and other inferior methods like hourly. They're going to be out there, but they're just not where my focus is. My focus is on the other end, trying to help people price and create more value so they can capture more value. I'm not interested in working for people that want to price in an inferior manner, because I think that means they're not providing enough value to you.”
– Ron Baker
Topics Covered:
01:17 – Mark’s five top reasons/times when cost-plus pricing makes sense
04:36 – Reacting to Mark’s five reasons / doing value-based pricing along with cost-plus pricing
08:13 – Pricing in micro and macro level businesses: cost-plus vs value-based
11:37 – Why Ron refuses to pay by hourly billing + how auto mechanics price their work
16:24 – Talking about Ron and Colin’s difference in perspectives
18:04 – How Mark charges clients ‘hourly’ and what Ron has to say about it
23:04 – Discussion around subscription + today’s topic in general: pricing metric
27:25 – Mark’s tax guy + why hourly billing isn’t ideal for Ron
31:17 – On announcing a price increase: Do something nice for your customers
Key Takeaways:
“The billable hour is what I'm crusading against, but on a larger perspective, the billable hour is cost-plus pricing.” – Ron Baker
“At a macro level, there's no way that costs justify price or determine price. Can't be. Otherwise, no business would ever go bankrupt.” – Ron Baker
“If somebody really did abuse you, then why would you ever work with that person?” – Ron Baker
People / Resources Mentioned:
- The Soul of Enterprise:https://www.thesoulofenterprise.com/
- Colin Jasper:https://www.linkedin.com/in/colin-jasper-7a401213/
- Win Keep Grow:https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784
- Time’s Up:https://www.amazon.com/Times-Up-Subscription-Business-Professional/dp/1119893526
- Marco Bertini:https://marcobertini.com/
- The Ends Game:https://marcobertini.com/book/
Connect with Ron Baker:
- LinkedIn:https://www.linkedin.com/in/ronbaker1/
Connect with Mark Stiving:
- LinkedIn:https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 20, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/subscribe-to-heated-seats-in-a-bmw/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This meme is the Ace of Spades from the Selling Value card deck.
Selling value really is the skill of increasing customer perceived value.
If you think about it, our customers don't really know how much value they're going to get from our products. And yet we as salespeople, product people, pricing people, we've seen other customers use our products. We've seen all the different places where they get value from our products. And if we've done a really nice job, we've been able to quantify some of that value that some of our previous clients have gotten.
Doesn't it make sense then that in a sales situation we find a way to help this buyer, someone who's evaluating our current product, to learn about and understand all the different ways our product might be able to add value to them. And once we can do that were increasing the amount of value that customer perceives for our product.
This is how we win more deals at higher prices. So, selling value really is the skill of increasing customer perceived value.
We hope you enjoy this memecast. This is also an example of how Pricing Table Topics works. Grab a deck of our cards, pull out a random card and read the saying. Then talk for one to two minutes about what the card says. This will improve your understanding, and more importantly, your ability to communicate important concepts.
If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
John Moss is the CEO of Flintfox International, a pricing software company with world class IP in the areas of pricing and revenue management. He’s previously worked as the Chief Strategy Officer and also General Manager of MYOB. John is also trained to use explosive and radioactive devices.
In this episode, John talks about the work they do at Flintfox. He explains why pricing models should change in line with the updates constantly happening at present on software. Additionally, Mark and he discuss the complexity of pricing, especially in these days of high inflation.
Why you have to check out today’s podcast:
- Discover why pricing models in software businesses should change from time to time
- Understand the current situation and complexities in pricing, especially in this time of high inflation
- Find out how much of a game-changer it will be to have organizations focus more on pricing and not just in cost reduction
“For many organizations, pricing has been off to the side and somebody who's got a quantitative bent will do that and look into it. I think there's an increasing need to employ experts in the organization that understand pricing, that understand pricing models, how you create value, and can help you manage through the current period of uncertainty.”
– John Moss
Topics Covered:
01:18 – How John got into pricing
02:37 – Lessons learned as they transitioned from transactional to subscription pricing
04:14 – Talking about the work Flintfox does
06:51 – What makes Flintfox different from other pricing software companies?
09:40 – Discussion about the complexity of pricing nowadays
11:20 – Avoiding channel conflict and posting things for the public to see
13:25 – The challenge of increasing prices during this period of inflation
18:02 – John, business software, and value-based pricing
22:36 – Pricing table topics: “Fixed costs never matter to pricing. Never, never, never.”
25:04 – John’s pricing advice
Key Takeaways:
“Software is no longer build something, release it, and it stays stable and constant forever. Software nowadays is constantly evolving and changing, and so the pricing model for that product had to change as well.” – John Moss
“It's increasingly important, I think, to have a good data set and an integrated data set to be able to understand exactly how your product portfolio is performing and what margins you're making.” – John Moss
“We're seeing more people have the confidence to put through a higher increase in the expectation that they do it once and maybe it lasts for 9-12 months, as opposed to putting through 3% now and then come back in two or three months’ time for another 3%, which that sort of attritional increase is probably less well received by customers than a big bang.” – John Moss
“It's a consequence of software. What young people and you and I now expect is that software gets better all the time. I mean, we all see it every day. Every app we have on our phone gets updated all the time incrementally. But some of these applications do improve functionality quite significantly over a number of years. And so that's what you're paying for, effectively – the fact that the developers are still working on this product.” – John Moss
People / Resources Mentioned:
- Flintfox International: https://www.flintfox.com/
- MYOB: https://www.myob.com/
- Microsoft: https://www.microsoft.com/
Connect with John Moss:
- LinkedIn:https://www.linkedin.com/in/johnrmoss/
Connect with Mark Stiving:
- LinkedIn:https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 13, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/ballet-football-pricing-and-sales/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Possibly my single favorite KPI in the world of pricing is average selling price. Are we managing average selling price per product, average selling price overall across the portfolio.
If you have a single product that has a price on it and you can monitor that average selling price, that gives you a great indication of what's going on in your marketplace, how well we're selling value.
If you can monitor average selling price by salesperson, now we're getting a great indicator of which salespeople do a good job at selling value and which ones don't.
If you can't manage average selling price, maybe you're going to have an average deal size. How big are the opportunities that we're facing, that we're being able to bid on? And which ones of those are we winning or not?
But my recommendation, find some KPI, maybe two or three, that are a great indicator of how well our customers are perceiving our value, which means their willingness to pay and how well our salespeople are selling value. Track them over time. Watch for the anomalies. Watch for the changes. And use those as indicators to see if you can figure out what's going on in your marketplace.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Gabriel Dabi-Schwebel is the Founder and CEO of SalesDeck, an online sales communication tool. He is also the Founder and CEO of 1min30, a French inbound marketing agency. He is an entrepreneur, speaker, and author of eight marketing and sales methodologies books. Gab hosts the Virtual Selling podcast.
In this episode, Gabriel talks about service packaging as he shares how they do it in his marketing company, 1min30.
Why you have to check out today’s podcast:
- Find out how to get your product packaging and pricing right
- Learn good, better, best service packaging through the way a marketing company does it
- Understand why pricing is at the heart of entrepreneurship
“If you are in service, the idea of packaging what you sell is very important.”
– Gabriel Dabi-Schwebel
Topics Covered:
01:29 – Growing up with French fonctionnaire parents while wanting to become an entrepreneur
02:19 – How Gabriel got into pricing; Gabriel realizes how important pricing is
04:36 – Talking about service packaging in line with his marketing company, 1min30
08:34 – The difference between the three price points
09:54 – Where he got the idea of his good, better, best strategy
10:36 – Did Gab learn how to have value conversations with clients?
12:06 – Gabriel’s pricing advice
14:51 – Pricing table topics: “Be strategic. Focus on lifetime value.”
Key Takeaways:
“I think pricing is really at the heart of entrepreneurship, because at one time, you need to price what you do, what you sell, what you create, and it’s really a marketing aspect that is very interesting, because with pricing, you can make your revenue even bigger without working too much.” – Gabriel Dabi-Schwebel
“It's really important to find the right price and to be sure that the price you choose is really the closest to what a customer is ready to pay and the ones that make you the more value and the more money in your pocket.” – Gabriel Dabi-Schwebel
“Really thinking about lifetime value is really thinking about what is the price being acceptable by your customer and the value you bring him, and also the fact that you keep bringing value and keep in loyal to your product.” – Gabriel Dabi-Schwebel
People / Resources Mentioned:
- SalesDeck: https://salesdeck.io/
- 1min30: https://www.1min30.com/
- Acquisition Strategy Design: https://www.amazon.co.uk/gp/product/2377740324/ref=dbs_a_def_rwt_bibl_vppi_i2
- Blair Enns’ The Win Without Pitching Manifesto: https://www.winwithoutpitching.com/the-manifesto/
Connect with Gabriel Dabi-Schwebel:
- LinkedIn: https://www.linkedin.com/in/gabrields/
- LinkedIn: https://www.linkedin.com/in/gabriel-dabi-schwebel/
Connect with Mark Stiving:
- LinkedIn:https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on July 6, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-good-case-for-cost-plus-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Pricing decisions can always help us achieve our goals. We need to make sure we understand what those goals are.
I would start with understanding what the corporate objectives are. Oftentimes those are things like we need to raise our average selling price. We need to gain more market share. We need to have more margin.
Typically, these goals, these corporate goals, are established by our CEO and our executive team, and they're there to drive increased market capitalization.
However, your product may have a different set of goals than what your corporate goal is. So, what is the goal of your product?
The goal of your product may be to bring more people into the platform so that we then have more people we can sell upgrades to. That's a great goal. We need to understand that as we're setting our pricing.
Your goal may be we need to generate more revenue, more profit, so that we can fund other projects. That's a great goal. We just need to know what our goals are. As we're making these pricing decisions.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
John Chisholm was a US lawyer. For 15 years, he's been in law firms, using value-based pricing, and now subscription pricing. John swims in the ocean every morning with his Speedo around his neck.
Pricing for law firms or even major consultancy firms is not easy. Price your final client contracts too high, and you’ll lose some of your most high-value clients. Price them too low, and you’ll be forced to work too few staff to the bone to cut costs.
In this episode, John shares how law firm should approach their pricing strategy.
Why you have to check out today’s podcast:
- Discover how to create a pricing revenue model that funds a thriving firm while generating real value for clients
- Learn how to make your law firm and consultancy clients understand the value of your service and the risks they are avoiding by hiring you compared to your competitors by communicating the value you provide
- Discover why a pricing expert is essential to the profitability of any law firm
“Just don't price your own work.”
– John Chisholm
Topics Covered:
01:06 – How John got into pricing: His late father’s story in relation to legal service fees
03:06 – Doing timesheet free billing as a law firm in the 1970s to ‘80s
05:25 – The old law business model of billing by the hour
06:38 – How things led him to his aha moment in relation to the practice of pricing
10:37 – Changing the mindset around pricing: Possible or not?
15:48 – “The true indication of a really good professional is not so much the answers they give; it's the questions they ask”
19:24 – Having a value conversation around $500 vs. $270’s worth
22:15 – John’s pricing advice
23:31 – Pricing table topics: “Sunk costs don't matter to pricing or any business decision”
Key Takeaways:
“Now it's very, very ingrained – the whole profession, I'm afraid. There has been a lot of movement, but they've been mainly in smaller, innovative firms. But the large firms, despite what they say, when you peel back the onion, the measurements, their rewards, their whole internal systems still work around time, and it's hard to change, and they're very successful.” – John Chisholm
“I know I’ll get into trouble for saying this, but lawyers buying and selling to each other is not a great recipe for innovation or change or taking risk.” – John Chisholm
“Those that perceive they have the most to lose will be the last to change, and that will be the big end of town worldwide.” – John Chisholm
“I try and get the lawyers that I work with my clients to stop thinking like lawyers, because often, the solution is not a legal solution; it really isn't, or the objectives are not a legal solution. It may be that what we're going to do has legal input, and that's the skills that the lawyers have that someone else doesn't have. But it's turning the conversation on its head. It's asking the right questions. And I think the true indication of a really good professional is not so much the answers they give; it's the questions they ask.” – John Chisholm
“I work more with my client lawyers focusing on what additional benefits can you give to clients, many of which don't cost anything to the law firm but add value to the client; the price just follows. I think also, if you can focus on increasing the client's profit, our profit will follow as a profession.” – John Chisholm
“I think even though it might be for short term profitability, there's just so many good lawyers that just do underestimate the value that they're providing to their clients, and that's their fault, not their client's fault.” – John Chisholm
People / Resources Mentioned:
- Ron Baker: https://www.linkedin.com/in/ronbaker1/
- VeraSage Institute: https://www.verasage.com/
- John Chisholm Consulting: https://www.chisconsult.com/
Connect with John Chisholm:
- Email: john@chisconsult.com
- Website: https://www.chisconsult.com/
- LinkedIn: https://www.linkedin.com/in/chisholmjohn/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 29, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-i-think-about-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one's really targeted at marketing people, product management.
It turns out that we make fun of salespeople a lot because they offer discounts, they don't know how to sell value. But the question that I would ask is, what have you given them in terms of tools and knowledge and confidence that they can win deals at the prices that we think they should be winning at?
We may have gone out and done a ton of analysis in the marketplace, we understand the value of our product, we understand how we compare to the competition, but have we shared that well with our salespeople?
In my newest book, Selling Value, I describe something called a value table. And if you've created a value table, it simply documents where the value of your product really comes from. And if you can share that information with your salespeople, it gives them the ability to go look for places where there really is value in the marketplace. And it gives them the ability to have value conversations with their customers and potentially close more deals at the prices that we think they should be winning at.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Colin Jasper has a Bachelor of Science in Statistics. He's been in consulting since 1997 and is currently a Principal at Positive Pricing in Melbourne, Australia. Colin is a competitive bridge player, and was a speaker at the Professional Pricing Society (PPS) this year.
In this episode, Colin debunks three pricing myths and explains why these are the complete opposite of what people should be doing in pricing.
Why you have to check out today’s podcast:
- Discover three common myths people practice when doing pricing
- Understand why these false myths and are the complete opposites of what people should be doing in pricing
- Find out why we shouldn’t compete on price and not behave like a commodity
“Let's not behave like a commodity. Let's avoid competing on price.”
– Colin Jasper
Topics Covered:
01:29 – How Colin got into pricing
02:31 – Creating huge impact on companies through pricing
03:31 – Billable hours in professional services firms: Perspectives of clients and firms
07:32 – Fixed $500/month vs. hourly fee for bookkeeping
09:31 – Good, better, best in fixed fee vs. hourly + the ultimate purpose of hourly rates
13:02 – Dealing with the uncertainty of projects
14:37 – Competitor pricing as a pricing myth
16:17 – “Aspire to be the most expensive and not be scared of that”
18:04 – Myth: Losing on price means their pricing strategy is wrong
20:26 – Colin’s pricing advice
23:13 – Pricing table topics: “Value-based pricing is never perfect. You can't read your customers’ mind.”
Key Takeaways:
“From a client perspective, if a client doesn't want hourly rates, that's fine. They've got that. However, from a firm perspective, I think if the firm is going to be client-oriented, they should give the client the fee structure that they want.” – Colin Jasper
“If your firm is going to put their interests ahead of yours, then you're probably working with the wrong firm in the first place. Because again, if the firm is putting their interests ahead of yours, they don't particularly care. I think the client ultimately chooses fee structure. It's our job to give them the fee structure they want, provided the fee level is high enough.” – Colin Jasper
“Ultimately, when I come to what I think is we're trying to achieve with pricing, it’s coming up with a price that we regard as fair to the firm but is also fair to the client. And I think there are times where the best way to achieve that is through hourly rates.” – Colin Jasper
“If you honestly aim to be the best firm in the market, your price has to send that message. You should aspire to be the most expensive and not be scared of that. You should own it.” – Colin Jasper
“If you never lose work based on price, your pricing strategy is flawed. If you never lose work based on price, you're leaving money on the table.” – Colin Jasper
People / Resources Mentioned:
- Positive Pricing: https://positivepricing.com/
- Ron Baker: https://www.verasage.com/ronald-j-baker/
Connect with Colin Jasper:
- Website: https://positivepricing.com/
- LinkedIn: https://www.linkedin.com/in/colin-jasper-7a401213/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 22, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/adopt-price-segmentation/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
**Connect with Mark Stiving:**
Email: mark@impactpricing.com
LinkedIn: https://www.linkedin.com/in/stiving/
I like to run the following thought experiment. Imagine that I'm auctioning off a coffee mug. Auction it off in a classroom, or a keynote room, and maybe I can get people to bid say $15 for my coffee mug. And then when I hand the coffee mug over, I intentionally pull out a $50 bill and show them, hey, this $50 bill was in the coffee mug. Well, why didn't I get paid for that?
Because the buyers didn't know that it was there. Their perception was, it was a coffee mug.
Now imagine I reach back and I grab a second coffee mug and I auction that one off. Now I might get $40. But what if there is an no $50 bill in this coffee mug?
The real point, is that what our buyers believe has everything to do with their willingness to pay. It actually has nothing to do with what's true.
Hopefully as marketers, as business people, we try to help clients believe the truth. But if we've built products that are better than our competitors, if we have $50 bills tucked into our coffee mugs and our buyers don't know it, we can't win the deals. We don't get paid for it.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Sagar Thakur is the Business Planning & Pricing Strategy guy at Outreach. He worked in SaaS Monetization Strategy at VMware, and he plays way too many instruments.
In this episode, Sagar talks about the challenges and opportunities of a pricing role as he explains why costs don’t drive pricing.
Why you have to check out today’s podcast:
- Discover the challenges and opportunities of being a pricing person, and why it’s challenging but beneficial to have pricing departments as internal consultants
- Find out what the three-step process is on how to tie value creation and value capture process together
- Understand why prices aren’t based on costs but on value/the customers’ willingness to pay
“Don't start with pricing. Start with assessing value, quantifying it, understanding it, getting your handle on what value is with a specific feature or product, how it scales, how customers perceive it, where they start, where they end.”
– Sagar Thakur
Topics Covered:
01:07 – How Sagar got into pricing
02:28 – The SaaS monetization strategy work he did in VMware
03:48 – The tradeoff: Organizing product portfolio and applying different price metrics
06:42 – What Sagar thinks are the challenges and opportunities of a pricing job
13:11 – How do we build a pricing culture inside an organization? Is it really a pricing culture or is it a culture of value?
16:00 – Pricing departments as internal consultants
17:59 – Having the perception that price is based on costs
21:09 – Sagar’s pricing advice
21:57 – Pricing table topics game: “Costs don't drive pricing. Willingness to pay drives pricing.”
Key Takeaways:
“In general, simplicity is better until you can make sense, but then if the tradeoffs become too steep, now you need to add the complexity as a color from that perspective.” – Sagar Thakur
“The ability to narrate a story or why is it that we're doing what we're doing and being able to support that, it's completely sort of a social / creative / engagement kind of job versus what most people think as an engineering sort of like analyze and say this is the perfect price. Dirty little secret in pricing is that there is no mathematically correct answer. It's a range of solutions which is possible.” – Sagar Thakur
“It sort of starts from education, moves to empowering. You can come up with everything on your own. It has to be a collaborative process. And then it's the energized piece, which is like show the organization that this is helping so that we can further attach our pricing perspective to the growth plans of the company and how that helps.” – Sagar Thakur
“I think rightfully so that pricing is a central piece to the puzzle of any company's sort of growth strategy, like how they do business and what not.” – Sagar Thakur
People / Resources Mentioned:
- Outreach: https://www.outreach.io/
- VMware: https://www.vmware.com/
- Dharmesh Shah: https://www.linkedin.com/in/dharmesh/
- Selling Value: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217
Connect with Sagar Thakur:
- LinkedIn: https://www.linkedin.com/in/sagar-thakur/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 15, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/buyers-value-journey-map/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
We all want our salespeople to sell more value. What does that actually mean though?
If we think about it, our customers, whether they be consumers or businesses, they buy value. They exchange money for the value they perceive that they're going to get from our product, however they want to measure that value.
Our job as a salesperson needs to be to make sure our customers, our buyers, understand how much value our product might be able to give them because the more value they perceive the more we can charge, the more likely we are to win the deal.
Our job as a salesperson selling value then is to increase how much value our customers perceive from our products.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Christine Carragee has been working as Carragee Consulting’s Business Consultant for more than six years now. She's done two different stints at the Vendavo – first as their Senior Pricing Consultant then as a Principal Consultant – so she certainly understands pricing. Christine was a Senior Pricing Analyst at Capella University. She lived on three continents before she was four years old.
In this episode, Christine explains why it’s a must that you consider the segmentation of individuals when doing pricing in higher ed as she shares her pricing journey with Capella University.
Why you have to check out today’s podcast:
- Find out how Capella University sets their price to students;
- Discover how financial aids such as scholarships and loans help you create good quality for the university; and
- Understand why it’s a must that think about the segmentation of individuals when doing pricing in higher ed
“A huge portion of higher ed pricing is through the grants and scholarships and loans. And so, what you're initially paying at the time that you're doing your coursework is very different from what the total cost of a program is for you.”
– Christine Carragee
Topics Covered:
01:47 – How Christine got into pricing
03:02 – Learning about airlines from her roommate and the book Hard Landing
05:01 – Trying to put economic value to a university; Segmentation of individuals in higher ed pricing
08:48 – Capella University’s two tuition structures; Grants, scholarships, and loans in higher ed pricing
12:54 – What Mark loves about the way they do pricing in higher ed
14:48 – Looking at how competitors do pricing + accepting high achievers and issuing financial aid
17:04 – Christine’s pricing advice for the listeners
18:15 – Table topics: “Pricing champions drive pricing change”
Key Takeaways:
“There's a huge portion of pricing in higher ed that you have to think about the segmentation of the individuals, where they are in their life and then what their personal and professional goals are. There's a big pressure on colleges and universities to provide educations that have a financial ROI. But if you think about the history of university, especially in the U.S., many, many of the universities started as seminary schools or they started as state institutions with land grants, and they were more about having an educated population for a general purpose, involvement in society, and they were not the career track programs that we think of them as today.” – Christine Carragee
“You can admit people who couldn't afford to come but have very high grades and have those personal statistics that make your institution look better on average by issuing financial aid.” – Christine Carragee
“That's a self-reinforcing cycle, where once you become established or you have a reputation around having very good quality students, then it's going to attract more people who want to go to school with high achievers.” – Christine Carragee
People / Resources Mentioned:
- Vendavo:https://www.vendavo.com/
- Hard Landing book:https://www.amazon.com/Hard-Landing-Contest-Profits-Airlines/dp/0812928350
Connect with Christine Carragee:
- LinkedIn:https://www.linkedin.com/in/christine-carragee-83642b226/
Connect with Mark Stiving:
- LinkedIn:https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 8, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/to-fee-or-not-to-fee/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Last week, we talked about economic value and how businesses are able to calculate how much money are they going to make or save based on buying and using your product or solution.
Sadly, consumers can't do that in almost all situations.
I love this one blue shirt I get from Brooks Brothers but there's no way to calculate how much money that shirt makes me or saves me. Instead, it's a feeling I get. It's the fact that I've gotten compliments when I've worn that shirt. So, I have a willingness to pay for that shirt over other shirts. I value it more than I value other shirts.
The only way I can think of to measure the amount of value is based on my willingness to pay. And this is true with our clients as well. When we start thinking about how much does a customer or a consumer value our products, we probably need to be thinking in terms of willingness to pay.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Dale Harrison has been consulting in life sciences for seven years now, but he's been an executive in biotech for 16 years. Dale started his career as a physicist.
In this episode, Dale shares how he’s able to not make biotech products a commodity as he tells us the stories on how he gets inside the minds of both their customers and competitors.
Why you have to check out today’s podcast:
- Understand the importance of stepping outside the product and the company when it comes to making a product stand out in the market;
- Discover why it’s a must that you get inside the head of both your buyers and competitors, especially with seeing where your competitors are blind in their framework;
- Find out how to get inside the mindset of your buyers and competitors through stories of tricks that worked
“Pricing has little to do with analysis. Analysis is a supporting role, but only supporting. The real issue with pricing is getting inside the head of the customer, and equally importantly, inside the head of your competitor.”
– Dale Harrison
Topics Covered:
01:02 – Dale’s work around commercial development and its relation to pricing
01:45 – Why Mark despises the word commodity + selling products in the synthetic DNA business back in the 2000s
04:28 – Not making the products a commodity by trying to get into the mindset of the buyer
09:25 – More about the story; The “Got Probes” T-shirt
13:01 – Merging the company with a larger partner and becoming the VP of Sales and Marketing
14:10 – Telling the story about getting inside the heads of the competitors
17:08 – Were they able to charge a higher price because of the red cap?
21:14 – The challenge of keeping customers continuing to reorder and focus on you and not be looking elsewhere
24:05 – Dale’s pricing advice for the listeners
Key Takeaways:
“Commodity is a mindset. It's not about the product. It's about a failure of imagination around the product. But there are products that are much more commoditized than others.” – Dale Harrison
“Again, these are very boring products, so if you talk about the product, no one's going to be interested because everyone already knows it. Nothing's changed and there's literally nothing to talk about. So, you have to talk about something different than the product and then tie it back to the product.” – Dale Harrison
“The deal is whatever market you're in, every competitor imagines that they have some highly rational pricing process, and the fact is they don't. What they have is a framework – a mental framework – and their framework is their blindness. And if you can understand what their framework is, you understand where they’re blind. When you know where they're blind, you know how to work around them without them even seeing you.” – Dale Harrison
Connect with Dale Harrison:
- LinkedIn:https://www.linkedin.com/in/dalewharrison/
- Email: w.harrison@gmail.com
Connect with Mark Stiving:
- LinkedIn:https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on June 1, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-power-of-economic-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
It's true, every time we buy something, we buy it because we think we get more value than the price it's going to cost us.
It's kind of hard for us as consumers to say how much is that value, and we think of that in terms of dollars. But in a corporate setting, how much they value something can almost always be decided by how much money do they think they're going to make or save because they're buying our product or our solution. That amount of money they're going to make or save is called economic value.
If we learn how to interpret our features and our benefits into our clients' economic value, and especially if we can learn to help them turn it into economic value, it will become much, much easier for us to close deals and understand why our customers are buying or not buying in the first place.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Christopher Uthe is the Director of Product Management at Ocelot, where he champions scalable day-to-day organizational changes to transform it to a product-driven company. He's been working in the education market since 2006, both for an educational institution and for companies that sell education. Chris started his first business at the age of 16.
In this episode, Chris explains how pricing works in institutions of higher education as he discusses the factors that make pricing difficult in that field.
Why you have to check out today’s podcast:
- Find out how to find value if you can’t get a good and apt pricing metric
- Understand how pricing in higher educational institutions work, as well as the thing that makes it difficult
- Discover why higher education should be more focused on B2C pricing than on B2B
“It's so hard to bundle and discount correctly, that most of the time, that's not being done right.”
– Chris Uthe
Topics Covered:
01:28 – The story behind Chris’ interest in pricing
02:15 – Pricing and purchasing decisions in higher education
04:37 – What institutions of higher education value: The thing that makes pricing in higher education difficult
08:18 – U.S. News and World Report as a metric: The intrinsic value of one’s degree and/or university
11:15 – In B2C vs. in B2B pricing: Where should institutions of higher education be?
14:17 – Talking about RFPs: How it leads us to lose sight of the possibility of a better and smarter solution
19:42 – Chris’ pricing advice for the listeners
21:45 – Connect with Chris Uthe
Key Takeaways:
“It's so difficult to come at these purchasing decisions, saying, ‘Okay, we have to do only what's best for the student here,’ because you've got so many competing priorities that are sort of odd for the market.” – Chris Uthe
“Some would tell you that they don't care. There are a sad few that would tell you they might care a little bit about profit because they do have to pay the bills, still. Not all of them are living on generous endowments, unfortunately, or fortunately, depending on how you look at it. They care about, hopefully, students’ success at the end of the day. They want to talk to you about placement rate. They want to talk to you about probably job acceptance rate. They want to talk to you about average salary coming out of school.” – Chris Uthe
“Some of the value – the unspoken value – of your degree or just going to an institution comes from all the doors that it opens for having it on your resume.” – Chris Uthe
“It almost always starts with a very altruistic need, which I think is amazing in higher ed, because our students aren't getting the help they need at the right time, for instance, or these students aren't able to log into the learning management system and do something meaningful at the right time or they don't know how to do it, they can't get it done. It starts very altruistic, which is one of my favorite parts of higher education, because it does usually come back to making the student more successful.” – Chris Uthe
People / Resources Mentioned:
- Ocelot: https://www.ocelotbot.com/
- CARES Act: https://www.congress.gov/bill/116th-congress/house-bill/748
Connect with Chris Uthe:
- LinkedIn:https://www.linkedin.com/in/chrisuthe/
- Email: uthe@ocelotbot.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 25, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/are-iphone-users-not-price-sensitive/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Oftentimes, salespeople are selling to a committee of people who have to make a big decision. Once they've made the decision, they typically say, hey, we want to go with this vendor, and then they submit it to purchasing or procurement.
At that point in time, procurement pretends to be price sensitive, pretends that there's multiple different competitors involved. But if we can recognize that we've already been chosen, then we don't have to compete hard on price. This happens often, especially if we're going to be selling to a committee who has to make a decision.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ayon Bhattacharyya is the Founder of Biz Growth Spurt, a consulting firm based out of New Zealand. He has experienced pricing in half a dozen companies, and he's a passionate animal welfare advocate.
In this episode, Ayon discusses pricing power as he enumerates its four different levels while talking about value-based pricing.
Why you have to check out today’s podcast:
- Understand how pricing power relates to price elasticity
- Find out what Ayon’s four different levels of pricing power are all about
- Discover how Mark’s will I? which one? concept relates to these levels
“Think about your pricing power, and think about how – whether it's sort of competitive advantage, perceived value, all of those things – what can you do differently to improve your pricing power today.”
– Ayon Bhattacharyya
Topics Covered:
01:18 – How Ayon got into pricing
02:33 – Defining value-based pricing and relating it to airline pricing
05:57 – Pricing power vs. price elasticity
09:50 – Ayon’s four different levels of pricing power
13:33 – Describing the levels: (1) Cost chaser
15:04 – Describing the levels: (2) Market pricer
15:46 – Describing the levels: (3) Value conqueror
18:16 – Doing behavioral economics at a cost chaser level
19:09 – Applying Mark’s “will I? which one?” concept to Ayon’s levels of pricing power
22:19 – Talking about value-based and fixed pricing
25:26 – Ayon’s piece of pricing advice for the listeners
Key Takeaways:
“Pricing power is essentially your ability to charge a higher price without losing customers. Another way to say that is a company's ability to get the price it deserves for the value it delivers.” – Ayon Bhattacharyya
“A maturity suggests that you need to get there over a period of time; you grow into it. It can't be something that you just start out with that, at level three. But that's not what I'm trying to say here. You can actually start out and you can be an early-staged business and you can start out as a value conqueror. You don't need to progress from level one to get to level three. You can start at level three.” – Ayon Bhattacharyya
“There are some businesses that can just start at a higher level, but I think generally, it is a journey. I think of pricing strategy as a journey, not just an outcome.” – Ayon Bhattacharyya
People / Resources Mentioned:
- Biz Growth Spurt: https://bizgrowthspurt.com/
- Stephan Liozu and his book: The Pricing Journey
Connect with Ayon Bhattacharyya:
- Website: https://bizgrowthspurt.com/
- LinkedIn: https://nz.linkedin.com/in/ayonb
- Email: b@bizgrowthspurt.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 18, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-much-does-a-buyer-value-your-product/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
You probably know that when we're negotiating, we do gifts and gets. We don't give anything unless we get something in return.
Purchasing people are always asking us for discounts and sometimes we have to give in. We give a discount to a client or a customer.
What should we get in return? Well, we should be thinking first about the things that are hard costs for us to serve our clients.
For example, maybe there's a shipping cost. Maybe it's a warranty cost. But there are things that are truly that cost us money and if we can get those as clawbacks, as our gets when we give something, then we're actually giving up a lower margin.
Many people call this pocket price. So, pocket price is, what's the price after I've looked at what are my costs to serve that individual customer.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Daniel Elizalde was an IoT Product Manager Instructor at Stanford University. He used to work as the VP Head of IoT at Ericsson, but he has now narrowed his focus from IoT to climate tech firms. Daniel now helps climate tech product teams accelerate their product’s time to the market.
In this episode, Daniel talks about his book, The B2B Innovator’s Map, as he explains why delivering value to your champion is a huge game-changer in the business world.
Why you have to check out today’s podcast:
- Discover what the book The B2B Innovator’s Map is all about;
- Understand why you, as a vendor, should understand what value means both to your company and to your customers; and
- Find out why you should look for champions and not for buyers, especially when you’re still starting in doing business
“When you are testing a potential solution, pricing has to be one of those things that you have to prototype. You have to prototype the packaging and the offering and how you actually present it to the customer.”
– Daniel Elizalde
Topics Covered:
01:55 – A Narrower Focus: Daniel shares the backstory on how he’s decided to shift his focus from IoT to climate tech firms
04:11 – Daniel talks about the benefits of running his own consulting practice
06:18 – Helping other people, still, in the space of IoT
07:41 – Why Daniel wrote his book, The B2B Innovator’s Map
09:46 – The difference between B2B and B2C in terms of the way people do innovation + the content of Daniel’s book
14:35 – Relating Mark’s Selling Value book to Daniel’s B2B Innovator’s Map
18:51 – Understanding the strongest problems that your customers have as one of the main points in the book
21:50 – Looking for a champion, not a buyer persona + the goal of innovation
28:36 – Daniel’s piece of pricing advice for the listeners
Key Takeaways:
“For an actual advisory project where I'm involved at the strategic level, I'm going to give priority to the climate tech companies, but that doesn't mean that there are no other avenues where people can get access to some of my experience.” – Daniel Elizalde
“In my experience, a lot of the B2B products fail because they don't deliver value to their customers, like, customers don't see the benefit, they don't want to buy it, so they've failed. Value has to be delivered throughout, and so, therefore, value plays an immense part throughout the journey.” – Daniel Elizalde
“Granted, as a vendor, your own solution is not going to be the fix for the whole problem, and you're part of the whole puzzle. But as a vendor, you have to understand what are those pains, what are those problems that your customers are having, because that's where the opportunity to deliver value lies.” – Daniel Elizalde
“The value needs to be big for a big problem so that you can get a solution in the door.” – Daniel Elizalde
“It's not about the users at this point. It's about delivering value to the champion because ultimately, that's the person that's going to open the door for you.” – Daniel Elizalde
People / Resources Mentioned:
- The B2B Innovator’s Map: https://danielelizalde.com/b2b-innovators-map/
- Ericsson: https://www.ericsson.com/
- Selling Value: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217/
- Crossing the Chasm: https://www.amazon.com/Crossing-Chasm-3rd-Disruptive-Mainstream/dp/0062292986
Connect with Daniel Elizalde:
- LinkedIn:https://www.linkedin.com/in/danielelizalde/
- Website:https://danielelizalde.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 11, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/data-and-or-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
If buyers are asking us for a business case, or help to write their own business case, what they're trying to do is document economic value. How much money is our product going to make or save their company?
Well, this is awesome because what we want to do is help our buyers understand value. This is the exact best situation that we could possibly be in. So, what we as salespeople should be doing is understanding, how is it that our buyers get value from our products? And I can tell you it's not our features.
And in fact, it's probably benefits, but it's benefits translated into, first, what's the problem we're solving for the customer? What's the expected result the customer might get? And finally, how do we turn that into dollars for that individual customer?
When you've mastered this skill, and you can talk like this constantly, you will definitely win more deals at higher prices.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
EPIC Conjoint’s CEO Matt Johnston and CTO Pavel Knorr help companies win by enabling game changing product and pricing decisions. At EPIC Conjoint, experts combine their deep domain knowledge with innovative research platforms. With this, they enable clients to better understand their customer’s preferences so they can make precise product and pricing decisions at great speed.
In this episode, Mark engages in a conversation about conjoint with EPIC Conjoint leaders, Matt and Pavel.
Why you have to check out today’s podcast:
- Learn the importance of running market segmentation studies and figuring out what people’s price sensitivity is to know which groups are becoming more price sensitive
- Find out why you should understand the challenges your target market is facing and react accordingly to that to be of help instead of going for your typical pricing mechanics
- Understand why you should be realistic in the way you do your design
“If you're addressing the question ‘what is the proper price right now?’ and ‘what is the proper price three months after?’ you have to properly specify the price intervals for that, and you have to deal with – specifically in conjoint – you have to deal with the realistic market situation.
– Pavel Knorr
Topics Covered:
01:25 – The backstory of how Pavel got into pricing
02:49 – Going back to the story on how and why EPIC Conjoint came to exist
05:56 – Talking about EPIC Conjoint’s project which Mark got involved with
09:56 – The global economy, recession, and its impact on people’s purchase decisions
17:08 – The challenge that arises when inflation rises but incomes do not
21:40 – Making decisions in the midst of supply constraints
29:50 – What Mark loves about what Conjoint does + the beauty of Conjoint
31:59 – Pavel’s piece of pricing advice for today’s listeners
33:39 – Connect with Matt, Pavel, and EPIC Conjoint
Key Takeaways:
“When you have product development background, for you, it's actually quite important when you want to come up with the product line up, when you're doing the product optimization, because it's fine to get the product which shows the overall quite good results with the aggregated view. However, in the reality, it might end up with the case when you have build the product that platform suggested to be the best aggregate of products in the market, however, nobody really needs it because all your market is several subgroups of the niche customers.” – Pavel Knorr
“We believe most people make purchases based on their needs. And what we've seen in the work we've done with clients is that needs can dictate different willingness to pay under different price sensitivities.” – Matt Johnston
“Conjoint is the good tool to compare yourself against the competitors, but it's not performing well when it's considering buy or no buy at all. All the magic behind the conjoint is something like 50% of success, because if you collect the bad data or from wrong people, you will have nothing as the output; nothing useful for you as the output.” – Pavel Knorr
People / Resources Mentioned:
- EPIC Conjoint:https://www.epicconjoint.com/
- O2:https://www.o2.co.uk/
- Telefónica: https://www.telefonica.com/
- URIDU: https://www.uridu.org/
- BMW: https://www.bmw.com/
- Hyundai: https://www.hyundai.com/worldwide/
- Audi: https://www.audi.com/
Connect with Matt Johnston:
- Website:https://www.epicconjoint.com/
- LinkedIn:https://www.linkedin.com/in/matt-johnston-5a53672
- Email: mattjohnston@epicconjoint.com
Connect with Pavel Knorr:
- Website:https://www.epicconjoint.com/
- LinkedIn:https://www.linkedin.com/in/pavel-knorr/
- Email: pavelknorr@epicconjoint.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on May 4, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/taking-the-ambiguity-out-of-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Behavioral economics are fun.
These are those tactics, the things that we see where our buyers are behaving irrationally, and yet we know they're irrational and we can take advantage of it.
In fact, my dissertation in my doctoral program was on 99 cents, and why does 99 cents work, and it's because buyers tend to be irrational. We should think of each penny or each dollar is identical, but we don't.
The thing is, although these behavioral economics tactics work, and we really should be paying attention to them because we want to present our pricing in the best light possible, it's only marginally effective. We need to get the value part right. If we don't get the value part right, it doesn't matter how we use our behavioral economics.
Now, to be fair, you can get the value part right and totally mess up a deal with horrible behavioral economics. So, both are important. But you absolutely have to understand value and get that right if you expect to win more deals at higher price.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Magdalena Bay has been working in business development for eight years now. She is an expert in the MVNO market, but outside of work, she loves spending time with her kids and showing her golden retrievers at dog shows.
In this episode, Magda educates us on how Mobile Virtual Network Operators (MVNOs) work, especially with how Mobile Network Operators (MNOs) and MVNOs price their offers.
Why you have to check out today’s podcast:
- Learn what the MNO and MVNO are all about;
- Understand how MNOs and MVNOs provide value to their customers; and
- Find out how pricing works in the MVNO market
“You need to give time to your customers so they can adjust to the new models you are trying to introduce. And maybe, sometimes, the strategy that you're implementing won't work in the beginning, but if you just wait little by little, then it can bring the results.”
– Magdalena Bay
Topics Covered:
01:45 – How Magda got into pricing
02:10 – Learning how Mobile Network Operators (MNOs) and Mobile Virtual Network Operators (MVNOs) work
07:21 – Why pricing in the MVNO market is interesting
09:27 – Sample scenarios of how MVNO provides value to customers
11:34 – How pricing in MVNO works
14:26 – What it means to play on a breakage when you’re in the MVNO market
16:20 – Magda asks Mark: “How do you approach your consulting when you’re in a totally new industry for you?”
18:18 – Does Mark have plans of getting experience from other countries and industries?
23:14 – Magda’s piece of pricing advice for the listeners
Key Takeaways:
“Pricing here is extremely difficult, in the sense that obviously, some of the customers wants to have everything the cheapest possible way. And in this setup, the infrastructure and building, everything cost your investment. You have to get your return on this investment. And as you mentioned before, MVNOs are always competing with these big boys, with MNOs, so this is almost impossible to be on the same pricing level.” – Magdalena Bay
“Assuming that you would get also unlimited plans from the MNO, you are very limited on how much you can earn, because you are only limited to this, let's say, two zloty per bundle or two euro per bundle – just any number I’m saying now – and you can't grow on this, if you know what I mean.” – Magdalena Bay
People / Resources Mentioned:
- AT&T: https://www.att.com/
- Verizon: https://www.verizon.com/
- Orange: https://www.orange.com/
- T-Mobile: https://www.t-mobile.com/
- Free: https://www.free.fr/
- Teleco: https://www.teleco.com.br/
- Affinity Cellular: https://www.affinitycellular.com/
- Airvoice Wireless: https://www.airvoicewireless.com/
- Assist Wireless: https://www.assistwireless.com/
- Beast Mobile: https://beastmobile.net/
Connect with Magdalena Bay:
- LinkedIn:https://www.linkedin.com/in/magdalenabay/
- Email: baymagda@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 27, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-value-of-selling-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Your marketing department, your product managers, somebody in your company has probably created value propositions for your products. And I love these. These are great because hopefully we've taken the time to think about the average customer, the generic customer, what's the real problem they're trying to solve.
The key for us though, if we're thinking about selling to individual buyers, is each buyer has a different set of problems. Each buyer is looking for a different set of results. What we want to be able to do is understand those value propositions and then query with the buyer where do they really feel the pain, what are the things this buyer is trying to get accomplished?
And a great salesperson is able to take the individual customers, or buyers, problems and translate that into perceived value in their minds.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Barry Edney started his pricing career in Sposea, a digital pricing and consultancy company aiming to drive profitability by simplifying price data optimization, management and execution. It was in May 2021 when he started his own consulting firm called Burning Issues Consulting, where they help businesses deliver better top-line and margin results by focusing on where change needs to happen quickly – the burning issues.
In this episode, Barry talks about the importance of knowing the right questions to ask the right people so you can sell value the way your customers need it in their business.
Why you have to check out today’s podcast:
- The importance of asking the right people the right questions in order to know what your clients really value;
- Why you should focus on value selling and avoid benefit selling;
- Why it’s a must for you to make sure that what you’re selling are the products that are giving you the big margin
“Focus on the margin drivers. If you have to be really cautious on your costs, focus on your products that generate your highest margin, and manage the rest of your portfolio for cash.”
– Barry Edney
Topics Covered:
01:00 – How Barry got into pricing
03:21 – Considering the cost to serve in relation to delivering value
04:18 – One product, different audiences, and different levels of value
06:44 – Perceived value vs. intrinsic value
08:05 – Not knowing what your customers really value + asking the right questions
13:40 – Examples of open-ended questions
15:31 – Why you should avoid benefit selling
17:48 – Creating, communicating, and capturing value: Thinking about solving problems vs. building features
22:26 – Barry’s piece of pricing advice for the listeners
Key Takeaways:
“When you start measuring the value that you deliver, it is so much easier to articulate it to your clients.” – Barry Edney
“The value has to be presented in a different way. There has to be a different value or a different aspect of the value you can deliver.” – Barry Edney
People / Resources Mentioned:
- Sposea: https://www.sposea.com/
- Burning Issues Pricing Consulting: https://www.burningissuesconsulting.com/
- AkzoNobel: https://www.akzonobel.com/
Connect with Barry Edney:
- Email: edney@burningissuesconsulting.com; barryedney@gmail.com
- Website: https://www.burningissuesconsulting.com/
- LinkedIn: https://www.linkedin.com/in/barryedney/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 13, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/dont-forget-the-customer/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Value-based pricing really is impossible to do perfectly.
In order to do value-based pricing perfectly, I would have to be able to read every customer's mind. I have to determine how much a customer is willing to pay for our product. And it's impossible to do that.
However, there are techniques and tactics that we can constantly use to get better and better. We can use techniques to help buyers understand more of our value, which will increase their willingness to pay.
As we start focusing our entire pricing strategy, and then we can shift our selling strategy to creating and capturing as much value in the buyer's mind, this is how we're going to win more deals at higher prices.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Stéphane Joanis started his career as a Chemical Engineer. It is with Thermo Fisher that he got involved in business and pricing, and just this January, Stephane launched his own consulting business which he calls SJ Performance, LLC. This is where he practices his expertise in B2B Instrumentation Pricing as he and his team provides coaching to help you build a strong pricing culture in a way that provides confidence and leads to trust.
In this episode, Stéphane educates us on the importance of achieving organizational transformation in a company as you value the trust in the relationship you have with your customers.
Why you have to check out today’s podcast:
- The importance of having people from different functional groups to talk about and practice value-based pricing and keep each other in check
- How the creation of strategies that inspire trust with your customers help your sales velocity to go up
- The power organizational transformation has in shifting from conventional pricing practices to having a value-based mindset in pricing
“The data is a means to the answer, towards getting insights. But it’s a foundation. Only data can trump politics. So, I think it's important to get your data and extract value from that data. Out of the specifications, go and get what is that value to your customer.”
– Stéphane Joanis
Topics Covered:
01:40 – How Stephane got into pricing; the importance of trust
03:32 – On building trust: Attack the processes, not the people
05:55 – Starting his business to guide people towards organizational transformation
06:28 – What organizational transformation is all about
08:56 – The trick to see something as a loss vs. as a gain
11:13 – How to help people have a value-based mindset: Specification language vs. value language
14:00 – Talking to customers and splitting up win-loss
16:07 – Formula of sales velocity and how that relates to trust
19:31 – “I will raise your price to the extent that I'm not breaking your trust”
23:12 – Intuitive/statistical hearing as a way to talk to customers
25:01 – Stéphane’s pricing advice
Key Takeaways:
“Everybody has a different point of view. There's so much psychology behind it. As you pointed out, there's a trust element. We have to agree to disagree. We have to have a certain level of trust, because everybody has a different objective with price. And so, how do you get everybody together, and how do you get prices aligned between them? It requires a certain level of trust if you want to do it well.” – Stéphane Joanis
“That's the key to organizational transformation. It's not just about a process; it's about the people as well.” – Stéphane Joanis
“You have to show what the customer is losing for them to truly appreciate what you have to offer and the value of your product and service.” – Stéphane Joanis
“There's a price to trust.” – Stéphane Joanis
People / Resources Mentioned:
- SJ Performance, LLC: https://sjperformancecoach.com/
- Pricing with Confidence: 10 Ways to Stop Leaving Money on the Table: https://www.amazon.com/Pricing-Confidence-Leaving-Money-Table/dp/0470197579
- SPIN Selling by Neil Rackham: https://www.amazon.com/SPIN-Selling-Neil-Rackham/dp/0070511136
- Selling Value by Mark Stiving: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217
- The Speed of Trust by Stephen Covey: https://www.speedoftrust.com/#the-book
- Data and/or Value (blog): https://impactpricing.com/blog/data-and-or-value/
- Focus on insights and not data (blog): https://www.sjperformancecoach.com/blog/focus-on-insights-and-not-data
Connect with Stéphane Joanis:
- Website:https://sjperformancecoach.com/
- LinkedIn:https://www.linkedin.com/in/st%C3%A9phane-joanis-6509921a/
- Email: sjoanis@sjperformancecoach.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 6, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/best-example-for-costs-dont-drive-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
It's true, value-based pricing is the optimal pricing strategy. Value-based pricing simply means charge what our customers are willing to pay. If a customer is willing to pay us a hundred dollars, the best we could possibly do as a company is to charge that customer a hundred dollars.
If we charge less, we left money on the table. If we charge more, the customer doesn't buy. So, it's impossible to do better than value-based pricing.
Now, I'll agree, it's impossible to do value-based pricing perfectly, which we'll talk about next week. But understand, adopt the mindset of how is it that we can always focus on how much our customer is willing to pay, how much value our customer is receiving, and that's the absolute best we can do at setting and trying to capture pricing.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ed Arnold works as an Advisor at Ibbaka, a software provider for high growth companies that helps optimize planning and execution of key growth initiatives while improving company performance. He was the VP of Products at LeveragePoint for 10 years, and was able to work with the pricing legend, Tom Nagle.
In this episode, Ed talks about the future of value-based pricing in the subscription economy as he discusses how product-led growth companies achieve their initial growth which later on leads to big wins.
Why you have to check out today’s podcast:
- Understand why pricing in value is the key in very clever segmentation in terms of creating user profiles in the market;
- Find out how product-led growth companies grow from being a small enterprise to being loved by a bigger market
- Discover companies that are product-led growth businesses and realize how much they’ve grown since day one
“Understand how your customer gets value from using your product, not from buying it; not in terms of what the product offering is in terms of features, but how they actually use it.”
– Ed Arnold
Topics Covered:
01:03 – Who is Tom Nagle?
01:41 – How Ed got into pricing + creating a tool and working with Tom Nagle
03:07 – Explaining what LeveragePoint is
03:50 – Future of value-based pricing in subscription: Value as a differentiator in the market
07:11 – Buying vs. negotiating a price: Knowing what you’re after
11:43 – Product-led growth practice as a brilliant strategy for business
13:55 – What Ed and everybody else likes about PLG – instant gratification
17:43 – Life-changing benefits of Slack
19:15 – Aligning pricing metrics
21:34 – Why usage-based pricing frustrates Mark
23:41 – Changing and having more than one pricing metric
27:13 – Ed’s piece of pricing advice for the listeners
28:06 – What Ed thinks about behavioral economics
Key Takeaways:
“If you're thinking about what sort of animal you're hunting in the enterprise game, those are the whales. I think value is the only way you can differentiate yourself in the enterprise market.” – Ed Arnold
“No corporate buyer ever heard of Slack until thousands of people in their company were already using it. So, in a sense, the business employee is a consumer, and that's how product-led growth companies are getting that initial growth. They're making it so ridiculously easy for people to start using it before the corporate procurement folks or even IT departments have any idea that they're using it. That's what makes that model so, so attractive for investors.” – Ed Arnold
“We like to talk about three types of metrics. And you got to link those three together. Ideally, if you can link those three together, you're in Nirvana, because your price is aligned with value and it's aligned with usage and everything is great.” – Ed Arnold
“When it's the right thing to do, and it makes sense, it does pay dividends. But it's tough. And I think it's really a leap of faith and doing it.” – Ed Arnold
People / Resources Mentioned:
- Ibbaka: https://www.ibbaka.com/
- The Strategy and Tactics of Pricing by Tom Nagle: https://www.amazon.com/gp/product/1138737518/ref=dbs_a_def_rwt_hsch_vapi_tpbk_p1_i0
- Monitor: https://www2.deloitte.com/global/
- LeveragePoint: https://www.leveragepoint.com/
- Salesforce: https://www.salesforce.com/
- Slack: https://www.slack.com/
- Calendly: https://calendly.com/
- Zoom: https://www.zoom.us/
Connect with Ed Arnold:
- Email: arnold@ibbaka.com
- LinkedIn: https://www.linkedin.com/in/edarnold1/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 30, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/shrinkflation-the-hidden-price-increase/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Boy, there's no way I can completely explain this impactful insight in a brief conversation.
But understand, if we can get our salespeople to shift from talking about our features and pushing our products to instead selling the value of our products to our marketplace, our salespeople learn to talk about the problems that we're going to solve, the results that our buyers are going to expect to achieve, this does magic in terms of the sales cycle and the end of the sale.
Because when we truly resonate with our buyers and their problems and hoped for results, we're going to win more deals.
We're probably going to win more deals even at higher prices, which is the key point. And if buyers are truly comfortable, they'll make decisions faster, shortening our sales cycle, and once we learn to think this way, we can look for buyers who have those problems.
Selling value seems to be this magic elixir to driving up ASP's, revenue, and profit.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Orvel Ray Wilson is co-author of the book, “Guerilla Selling”, and five other books in the “Guerilla Marketing” series, the best-selling marketing series in history. He is a Certified Speaking Professional, a coach to those who want to build their practice as an author, a speaker, and a thought leader. Through The Guerilla Group, he helps professionals build and grow their business by focusing on writing, stagecraft, and marketing. Orvel Ray is Mark Stiving’s personal business coach.
In this episode, Mark and Orvel Ray talk about the former’s newly released book, Selling Value, as they both share stories in all ways connected to his account.
Why you have to check out today’s podcast:
- Learn about the importance of translating what matters to your customer into something of real value, like measurable dollars
- Discover what the book, Selling Value, is trying to show salespeople
- Find out how the Guerilla series was able to move a lot of people, including product managers, product marketing, and other VAs
“If you're closing more than about 70% of your opportunities, you're not charging enough.”
– Orvel Ray Wilson
Topics Covered:
01:55 – The story of how Mark and Orvel Ray met
02:40 – Working with Mark for his book, Selling Value: Taking note of what’s important to your customers
06:19 – What the book is showing salespeople how to do + how the ‘Will I? In which one?’ concept came to exist
10:03 – Orvel Ray’s friend, Jordan, who was able to close an $85,000 deal as he learns from Mark’s book
14:59 – Why should salespeople and pricing people care about selling value?
18:14 – Send Orvel Ray a message and get one free hour of free consultation on how to become a speaker and/or an author.
19:20 – Orvel Ray’s piece of pricing advice
21:43 – What anchoring is all about
Key Takeaways:
“Salespeople need to understand how this really works, not only to convey and do the math and show them that this is a good investment, but to do that in terms that are important to them.” – Orvel Ray Wilson
“I might have 100 good reasons why you should buy my product, but your decision is going to hinge on the three or four reasons that you think are important. And if you can isolate what those are and sell to those, then two things happen – one, the sales process is a lot simpler, and your offering is going to be irresistible.” – Orvel Ray Wilson, Guerilla Selling
“Many times, we fail, we lose the sale, not because our product isn't a good fit, or because we don't have superior technology, or aggressive pricing, but simply because we haven't got the customer to make the ‘will I?’ decision in the first place.” – Orvel Ray Wilson
“Just putting this technology in the hands of your sales team is going to make an immediate and measurable impact, as I've already said, and certainly more so than any other sales book I've read recently; and I've read them all.” – Orvel Ray Wilson
“Build value, include everything, load up the table like it's Thanksgiving dinner, and then if you have to talk about reducing your fees, you can take things off the table and still defend your value.” – Orvel Ray Wilson
People / Resources Mentioned:
- Selling Value: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/dp/1737655217/
- Houghton Mifflin:https://www.hmhco.com/
- Guerilla Selling: https://www.amazon.com/Guerrilla-Selling-Unconventional-Weapons-Increasing/dp/0395578205/
- Impact Pricing: https://www.amazon.com/Impact-Pricing-Blueprint-Driving-Profits/dp/1483489701/
- Patricia Fripp: https://www.youtube.com/user/PatriciaFripp
Connect with Orvel Ray Wilson:
- LinkedIn: https://www.linkedin.com/in/orvelray/
- Email: orvelray@guerillagroup.com
- Website: https://guerrillagroup.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 20, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/selling-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
It's absolutely true, people don't buy products, they buy solutions to problems. When we talk about our products, when we talk about our features, that doesn't truly resonate in the minds of our buyers.
Instead, what we need to be doing is talking about the problems that we're going to solve as well as the results a buyer might achieve. When we can capture their attention, recognizing the fact that they have a problem and getting them to agree that they have that problem, and then describing the results they might be able to achieve by solving that problem, now we're getting their attention.
These are things they can truly value. And by the way, maybe we're solving more problems than they originally thought they were when they were looking for a product like ours.
When we truly understand problems and results for our marketplace, and we can talk to our customers that way, our customers then perceive a lot more value, which means we can win these deals at higher prices. And that's really the whole point.
We hope you enjoyed this memecast. This impactful insight came from the book, Selling Value, which I wrote to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jon Barker has been involved in managing government contracts from the supplier side his entire career. He started a company called PTW Solutions, where PTW means Price To Win, and they help companies win government contracts. Jon is an avid coach and he's coached both lacrosse and soccer. When coaching, Jon fosters a team environment, while learning the strengths and weaknesses of each individual to build up skills and confidence.
In this episode, Jon talks about government contracting as he puts emphasis on why the government’s focus is set on cost-plus.
Why you have to check out today’s podcast:
- Learn how pricing runs in government contracting
- Discover what a “probability of win” means and why you should focus on deals with higher “probability of win”
- Find out resources you can visit as you look for data of your competitors’ prices
“Create your own internal models of the data that you use a lot to make those decisions, and have the ability to make the levers change easily. I think as a government contracting pricer, it would be extremely beneficial.”
– Jon Barker
Topics Covered:
01:36 – The start of Jon’s pricing journey for government contractors
04:39 – Small businesses having more volatility with government contracting if compared to large companies
08:10 – What’s a P-win + what Jon loves about the field he’s in
09:23 – Best value tradeoffs; putting energy into writing proposals for deals of higher p wins
14:23 – Position, Plan, and Price to Win; Government contracting as an interesting field
17:37 – Go-to’s of a data guy: GSA price list, GSA Calc, STARS III, SAM, USA Spending
22:25 – Jon’s passion for government contracting
24:44 – Jon’s piece of pricing advice for today’s listeners
Key Takeaways:
“Here's the beauty of it. When you're talking with larger companies, those rates are set. When you're talking to smaller companies, they have a lot more flexibility. They're not on the radars of these agencies… The smaller you are, the more of an art it is to be able to be clever with the numbers and figure out where you can ship those costs.” – Jon Barker
“As you add layers and layers of contracts that you win, you have more capabilities. The biggest thing about winning contracts is being able to successfully execute them.” – Jon Barker
“Section M (evaluation criteria) is probably your most important section in terms of how to create a winning bid and how to tailor your technical and your pricing strategies in order to maximize that probability of win.” – Jon Barker
“The government customers’ so huge, and there's so many different facets to it. There's plenty of other work to be had there. Don't get focused on, again, losing efforts to where the evaluators are not going to find the value in your offering, because you're not set up to be successful for that.” – Jon Barker
“Pricing is just a fascinating topic; it’s very psychological, as you know. But in government procurement, it's very much cost-plus based, because the government expects to understand how companies came up with the rates that they bid.” – Jon Barker
People / Resources Mentioned:
- PTW Solutions Inc.: https://price-to-win.com/
- CPARS: https://www.cpars.gov/
- GSA Calc: https://calc.gsa.gov/
- STARS III: https://www.gsa.gov/technology/technology-purchasing-programs/governmentwide-acquisition-contracts/8a-stars-iii
- SAM: https://sam.gov/
- USA Spending: https://www.usaspending.gov/
- Federal Acquisition Regulation: https://www.gsa.gov/policy-regulations/regulations/federal-acquisition-regulation-far
Connect with Jon Barker:
- Email: jon@pricetowinsolutions.com
- LinkedIn:https://www.linkedin.com/in/jon-barker-4648b84/
- Telephone: 571-216-9890
- Website: https://price-to-win.com/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 23, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/peloton-tests-new-pricing-model/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
It really is fascinating that experts can translate our features into our benefits. And oftentimes as salespeople, as pricing people, as product managers or product marketers, we are experts in our own products. We think about a feature and we can automatically understand what those benefits are that our customers are going to achieve.
But do our customers understand those benefits? And if they're experts then sure they do, but aren't we all trying to win new business? Aren't we all trying to find customers who are just getting into the product category, who are choosing between our products and our competitor's products?
In these cases, our customers might know what the features are but they don't truly understand the benefits they should expect to receive.
Imagine you've never, ever used a computer before and some salesperson tells you, yeah, this one has a terabyte static DRAM. You're thinking, okay, who cares? They have to be able to translate it into benefits.
And so often when we speak to our potential buyers, we're speaking to them in the things that we think are so meaningful, our features, but they can't translate that into their benefits.
If we truly want them to get the value of our products, we have to do the translation.
We hope you enjoyed this memecast. This impactful insight came from my book, Selling Value, which was written to help salespeople win more deals at higher prices. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
DeAnn Hammer is the Global Pricing Operations Manager at 3M, an industrial machinery manufacturing company that innovates with purpose and uses science every day to create real impact in every life around the world. She was originally a Marketing Manager in 3M. DeAnn was the valedictorian of her high school senior graduating class
In this episode, DeAnn shares how she does the work of simplifying prices in a way that your customer understands as she puts emphasis on having not to negotiate once it’s properly done.
Why you have to check out today’s podcast:
- Find out why it’s a game-changer move for you to make buying a B2C experience for clients in a world of B2B;
- Discover how simplifying pricing removes the need for negotiating prices in the market; and
- Understand how price simplification unwinds the complexity in pricing
“If you make customers wait, you're going to lose the sale. Process and simplicity are going to allow you to grow your business even on really mature products.”
– DeAnn Hammer
Topics Covered:
01:53 – How DeAnn got into pricing; DeAnn as a market development manager
03:07 – Marketers overpricing and underpricing their products
06:34 – The difference between the roles of a pricing manager and a pricing operations manager
08:09 – Activating pricing and making it a B2C experience in a B2B world
12:36 – Houses and cars as the only things consumers negotiate for
15:15 – Unwinding the complexity in pricing through price simplification
21:00 – Determining what’s wrong with Mark’s strategy
23:34 – Having to make tradeoffs by trying to get rid of negotiated deals
25:32 – DeAnn’s piece of pricing advice for today’s listeners
Key Takeaways:
“You do a lot of insights work in marketing and you're gathering that information about customers’ willingness to pay, but there's also really bad questioning and marketing insights. What people tell you during insights isn't always what they mean, so you really need to pay attention to that willingness to pay and the value the product gives.” – DeAnn Hammer
“Activating pricing and making it a B2C experience in a B2B world; I actually think that's how we can grow.” – DeAnn Hammer
“I really think businesses have to start thinking about things that are easy, things that people understand, things that they have the data for, how can they just buy those, versus those things that are really perceived as having a much higher value in the idea that it should be negotiated. I think there's a line there about what should be negotiated and what shouldn't be.” – DeAnn Hammer
“There was a time where you had to walk into a bank. There was a time you had to wait for an answer. And that's no longer the culture that we live in; we want that instant gratification.” – DeAnn Hammer
“Keep it simple. Get the price out there. Let them buy it.” – DeAnn Hammer
People / Resources Mentioned:
- 3M: https://www.3m.com/
- Kelley Blue Book: https://www.kbb.com/
- Carvana: https://www.carvana.com/
Connect with DeAnn Hammer:
- Email: dmhammer@mmm.com
- LinkedIn: https://www.linkedin.com/in/deann-hammer-4360a2a/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 16, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-people-shouldnt-set-prices/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Usually, when we think about creating a new business model, it revolves around pricing. It often revolves around, what are we going to charge for?
If you think about what Netflix did when they first launched, you may recall Blockbuster was renting movies by the night, they were charging late fees. Most of their profit came from their late fees. Netflix on the other hand decided to offer a subscription where you could have one, two, or three DVDs at your house at any point in time, and you just paid a flat monthly fee. There were no late fees. What they did was changed the business model. They changed the pricing model.
Now, how does this help everyone?
Well, it helps everyone in the sense that now there's a group of people who prefer the subscription to the daily rental and they can go subscribe. We didn't eliminate one, although eventually, we did, but we didn't eliminate one, we just said let's offer more options to the marketplace. But in this case, especially the Netflix versus Blockbuster case, it was such a powerful thing that it really did eliminate the daily rental business. So they changed an entire industry.
Take a moment. Step back. Think about how your customers really get value from your products, what they truly value, and can you change your business model to make your customers happier about the way they pay for your products? You might change your own industry.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jon Jennings is the Founder and Managing Partner of Jennings Executive Search, LLC. Jon is an official sponsor of this podcast. He began his career with a boutique recruiting firm, building relationships with C-Level accounting and finance professionals utilizing a research-based approach of study and analysis to best serve his clients. In 2012, Jon took this approach to a larger firm where he worked with several CFOs to build entire accounting and finance departments and gain a large firm perspective in how to build a successful practice. This experience led to the creation of Jennings Executive Search, LLC.
In this episode, Jon discusses the current situation of the pricing market, specifically focusing on how things have developed since the pandemic began.
Why you have to check out today’s podcast:
- Discover how the market has been like since the beginning of this pandemic;
- Learn about the difference of hybrid, in office, and at home settings, as well as how this difference influence today’s job search; and
- Find out why those people who are willing to learn the soft skills of pricing are the ones who are more likely to be promoted in a company
“The people who get to move up are people who are adamant. They're persistent. They're not afraid to be uncomfortable in an uncomfortable conversation.”
– Jon Jennings
Topics Covered:
01:28 – The market’s situation since the pandemic began
04:17 – Talking about the expansion of pricing
06:01 – Everyone trying to figure out how to raise prices and putting hyper focus on it
08:49 – Are pricing people getting paid a lot more now than they were a year ago?
12:18 – Companies still not investing in pricing
14:48 – Are the requirements changing for pricing people?
18:35 – Those who are willing to learn make the biggest impact in a company
20:27 – How the difference between hybrid, in office, and at home settings influence today’s jobs
24:29 – Jon’s piece of pricing advice for today’s listeners
Key Takeaways:
“What's really happening in pricing has been happening for a long time, which is it's expanding; there's more jobs in pricing, and kind of separate to the current economic phenomena that we've seen over the last few years, it's been a space that's grown.” – Jon Jennings
“There's a lot of openings in pricing and it's hard to find qualified people for them at the moment.” – Jon Jennings
“I call it fittest athletes search. We just find the person that's most capable and learn the fastest and can just solve problems, solve business problems; they'd like to get in the business and figure things out and communicate cross functionally. Those are the traits I like to look for.” – Jon Jennings
“The really good ones have a creative type of mind; not just they're good at analytics, but they have that creative side turned on and they can communicate very well. It's like yet to be everything at the same time. Those people are really impactful.” – Jon Jennings
“You have to articulate the right way, that's digestible and understandable, and you got to win that meeting; and that's where you have to sell yourself, your abilities, all the time. That's really what makes you promotable.” – Jon Jennings
“The way to have a big impact on your career is always selling. There's never a perfect solution; there's better and best. When you have something, be confident and don't back down. The squeaky wheel gets grease.” – Jon Jennings
People / Resources Mentioned:
- McKinsey: https://www.mckinsey.com/
- Bain: https://www.bain.com/
- BCG: https://www.bcg.com/
- KPMG: https://home.kpmg/
- Simon Kucher: https://www.simon-kucher.com/
Connect with Jon Jennings:
- LinkedIn: https://www.linkedin.com/in/jonjennings/
- Email: jon@jenningsexec.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 9, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-value-of-teachers-vs-athletes/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Let's face it, pricing people, we're typically smart. We have to interact and interface with lots and lots of different departments. But we rarely have the authority to make decisions that impact the entire company.
These decisions could be changing pricing strategies, changing pricing metrics, focusing on market segments that we're going to go target. It could be getting product people to use value as they make decisions on which products to buy, or marketing people to document what value looks like as they're doing their marketing messages, teaching salespeople how to sell value.
All of these are crucial when it comes to us helping the company win more deals at higher prices, but we don't have authority. What we do have is the knowledge typically to help these things happen.
The only people in the company who have the authority to force these things through, to convince people who might be reluctant to say, "Yes, okay, let's go try it," are executives.
If we don't have executives driving pricing initiatives, or even better yet, driving a culture of value. If our executives aren't doing this, we're leaving significant money on the table because there are lots of opportunities for us to go increase profit, we just don't have the authority.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Gerald Smith is a Professor of Marketing at Boston College. He's been a Pricing Consultant with Strategic Pricing Group and Monitor Group since 1987. Gerald is the author of a relatively new book, “Getting Price Right: The Behavioral Economics of Profitable Pricing”.
In this episode, Gerald discusses the power psychology holds in pricing in relation to behavioral economics as he talks about the soft side of pricing alongside the importance of framing.
Why you have to check out today’s podcast:
- Find out what the hard side and soft side of pricing are all about, and why the behavioral side of pricing is more powerful than the logical side
- Understand why companies do framing, as well as why a frame of reference is important in pricing
- Discover why there’s power in psychology when talking about behavioral economics
“Ask yourself and ask your pricing team, what do customers get and what do they pay for what they get? And say, is everybody in the industry doing it the same way?”
– Gerald Smith
Topics Covered:
01:39 – The start of Gerald’s pricing journey with Thomas Nagle and Reed Holden
03:08 – Gerald talks about his dissertation in relation to his new book, Getting Price Right
04:33 – The behavioral/soft side as potentially more powerful than the logical side
06:39 – The main point of Getting Price Right – the psychology of the sellers, the people that really set price
09:11 – Talking about the dominant pricing bias of salespeople giving discounts all the time
13:07 – Pricing strategy vs. pricing orientation
15:15 – Framing as one of the foundational theories of economics
18:09 – Discussion about Apple’s pricing slogan and the company having huge margins
22:45 – The power of behavioral economics – psychology; analysis vs. gut
24:12 – Talking about frame of references and setting price metrics
27:45 – Gerald’s piece of pricing advice for today’s listeners
Key Takeaways:
“We always think of pricing as a hard skill, as a quantitative skill. My students say to me, ‘Professor, tell me the formula for setting price.’ And I say, ‘No, no, no, folks.’ I mean, pricing is a soft skill that also brings in hard skills, for sure, so there are both skill sets.” – Gerald Smith
“Sellers are also psychological and absolutely driven by psychology.” – Gerald Smith
“One of the very dominant biases in pricing is that people have a tendency to discount price all the time. It's very irrational, and it, in fact, violates the principles of both psychology but especially economics, because economics says that people should rationally maximize the profits of the outcomes that are before them. And in the case of many people that apply this kind of discounting bias, they don't focus on the profits; they focus on the sales, and sales are not profits.” – Gerald Smith
“Salespeople that work for somebody else are more likely to discount, but salespeople that do their own thing are less likely to discount. When they're selling their own place, they want to make sure that they maximize their profits if they can, but if they're selling for somebody else, they're happy to take that deal. That's because they get paid a commission on the deal. It is endemic to the world of pricing that people do this.” – Gerald Smith
“Psychology is powerful. Analysis is terrific, but psychology is absolutely vital.” – Gerald Smith
“Consumers or buyers give, but they also get. And so, if I can change what they get and what they give, then that can be very powerful.” – Gerald Smith
People / Resources Mentioned:
- Getting Price Right: The Behavioral Economics of Profitable Pricing: https://www.amazon.com/Getting-Price-Right-Behavioral-Profitable/dp/0231190700
- Freakonomics: A Rogue Economist Explores the Hidden Side of Everything: https://www.amazon.com/Freakonomics-Economist-Explores-Hidden-Everything/dp/0060731338
Connect with Gerald Smith:
- LinkedIn: https://www.linkedin.com/in/dr-gerald-smith-91b8383
- Email: gerald.smith@bc.edu
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on March 2, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/indirect-customer-impact/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This one may be intuitive, may not be intuitive, but it turns out that if your fixed costs change, for whatever reason, if they go up, if they go down, it really should have no impact whatsoever on your pricing. For example, let's say you need to buy a new piece of factory equipment, and it's really expensive, and it makes your fixed cost go way up.
Did buying that new piece of factory equipment for you change your customer's willingness to pay?
No, it didn't. Customers are still willing to pay the same amount. They still can choose between you and a competitor.
Well, did you changing your fixed costs changed the way your competitor prices for whatever reason?
No, it doesn't.
The only thing that matters to us when we're doing pricing is thinking about how our customers are making decisions and how we can make optimal decisions based on that. And I can assure you that your fixed costs have absolutely nothing to do with how much your customers are willing to pay.
For that reason, your fixed costs never matter to pricing.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Reginald Tomas Lee is a Professor of Business Analytics at Xavier University in Cincinnati, Ohio. He has a PhD in Mechanical Engineering, and he's been involved in supply chain since ’96. Reginald’s most recent book is called Project Profitability. And one fun thing, he can't go on vacation, because he has two killer dogs.
In this episode, Reginald shares wisdom with regards to the modeling he’s been making as he talks about the power of helping people understand more clearly how what it is that they do impacts cash.
Why you have to check out today’s podcast:
- Understand why you should start seeing things from a cash perspective in relation to knowing what it is that it enables you to save
- Learn about the difference of cash cost and non-cash cost through situational examples from real life experiences
- Find out how your actions and decisions impact how you generate cash in a business
“Don’t focus on accounting margins.”
– Reginald Tomas Lee
Topics Covered:
01:17 – How Reginald shifted from being a mechanical engineer to thinking about supply chains and costing
03:44 – What Reginald does: Helping people understand how their decisions impact cash
07:18 – Talking about contribution margins: Accounting for things from a cash perspective
11:09 – How to figure out the optimal price without using some measure of contribution margin
14:34 – Hope as a strategy: Mark’s opportunity cost vs. Reginald’s opportunity revenue
17:15 – Two types of costs: The cash cost and the non-cash cost
21:41 – Reginald’s sales pitch: Very specifically identifying what the savings are
24:02 – Discussion about Mark’s value table and Reginald’s improvement projects
27:59 – Projecting revenue and the uncertainty that comes with it
30:24 – Reginald’s piece of pricing advice for today’s listeners
Key Takeaways:
“We should shift away from looking at accounting data and look specifically at operations and cash.” – Reginald Tomas Lee
“From a cash perspective, materials and labor don't vary. When we look at contribution margins for products that we make, and we assume that those costs vary and they affect the contribution margin, my argument is they don't vary. And so therefore, it's not a reflection of cash.” – Reginald Tomas Lee
“As we know, hope’s not a strategy. We’re hoping that the demand would be there, but I've seen situations, actually, where people have bought more just to get a lower price so that they can report a higher gross margin. It's not a good business decision at all. And that's why I shift over to cash, because cash will tell you don't do that, but accounting may, because I can put it in inventory.” – Reginald Tomas Lee
“If you want to save money, what you have to do is basically buy fewer people. Buy four people instead of buying 10 people. Buy less capacity, then I'm spending less money.” – Reginald Tomas Lee
“I focus specifically on what changes the software will enable, and then point out that if you want the cash savings, you need to make managerial decisions. You have to make a decision to get rid of the four people because the software is not going to fire them. That's what you have to do. The software is not making the cost savings happen. It's my management decision and action that was at that.” – Reginald Tomas Lee
“I define efficiency as engineers do – output over input. So, if my input is my organization, what I'm spending on the organization, and the output is what it is that they can do, then what this will do is that we’ll generally allow them to either create more output with the same group, or consume less of that group to create the existing amount of output. But the size of the organization itself doesn't change until I, as a manager, change it.” – Reginald Tomas Lee
“Based on how we choose to calculate this cost, that may have an impact on whether we take the business or not. So instead of focusing on accounting margins, if you can take a look at the cash impact of the decision that you make, then I think you'll be in a much better position to be able to negotiate price and feel good about taking prices that in some cases you may not have taken just because someone calculated a number that happen to be lower than someone else's calculation.” – Reginald Tomas Lee
People / Resources Mentioned:
- Project Profitability: https://www.amazon.com/Project-Profitability-Ensuring-Improvement-Projects/dp/1637421699
- The Goal: https://www.amazon.com/Goal-Process-Ongoing-Improvement/dp/0884271951
Connect with Reginald Tomas Lee:
- Email: reginald.lee@bdrco.org
- LinkedIn: https://www.linkedin.com/in/reginaldtomas/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 23, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/direct-customer-impact/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
It's true, pricing can have an instantaneous response. I often think of it as the nuclear bomb of marketing mix variables because you can change it today, impact the market immediately, and it's really hard to take it back.
Now, compare that to the other marketing mix variables. If you've taken a marketing class, you know the four P's. You know the other three besides price, or your product, your place, and your promotion.
Product is obviously, what are we building? The place is, what's the distribution channel look like? And then the promotion is, how are we marketing it? How are we talking about it in the marketplace?
We could change our marketing. We could change our product. We could change our distribution channel. And each one of those would have an impact on our revenue, on our sales. But it takes a long time for that impact to ripple through.
On the other hand, if I change price today, people will change their mind today. Some people will choose to buy, some people will choose not to buy, simply because of the price change. So price really does have the fastest impact, but it also is one of the most dangerous to use. If you're using price to gain share, you're probably just driving industry profits down.
So, although it's fast, be very careful how you use it.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Pedro Piccoli Soares is currently Senior Executive Manager of AI Pricing at SIXT, a travel arrangement / car rental company that’s known to be a provider of high-quality mobility services. He mentors startups, and has an Engineering degree. He also has a purple belt in Brazilian jiu-jitsu.
In this episode, Pedro shares his knowledge when it comes to behavioral economics as he and Mark talk about how it works in relation to mental accounting and pricing.
Why you have to check out today’s podcast:
- Discover why it’s important for companies to understand why they’re doing pricing and why they’re having a price change
- Understand why you should still be relative to your competitors’ price change even when they’ve already made the mistake of decreasing their prices
- Learn more about behavioral economics, its tactics, and its relationship with mental accounting and pricing
“So, we've mentioned several different effects of behavioral economics and several different examples of how they can be applied on real business. If you think about it, they were quite simple, right? It's really easy to test these kinds of things, and they can generate some really nice benefits to your company, for sure.”
– Pedro Piccoli Soares
Topics Covered:
01:40 – The internship that led to Pedro’s shift from being an Engineer to doing pricing
03:09 – What Pedro loves about pricing that made him stay in it
05:34 – Why it’s important for companies to understand why they’re doing pricing and why they’re having a price change
07:38 – Being relative to competitors’ price change even when they made the wrong decision
10:20 – Talking about behavioral economics; what Mark doesn’t like about it
12:33 – Behavioral economics’ tricks: Pedro and Mark’s perspectives in relation to price endings in relation to mental accounting
18:49 – Discussion about what loss aversion is
20:38 – The use and importance of loss aversion, especially in business
23:23 – Behavioral economics and people’s buying decisions in relation to good, better, best
25:53 – Pedro’s piece of pricing advice for today’s listeners
Key Takeaways:
“This is when you kind of lose the sense of why you're doing the price change. If you just follow your competition, if you don't know the reason why you're changing the prices, you can initiate a fight that in the end has no background or no reason to be happening. You are assuming that everything that they are doing is right, and that they know why they are changing prices. It might be the case, but might be the case that they are also doing something wrong and you're just following them. You need to understand your customers and what price changes will affect them. You need to have a reasoning you apply when you’re changing the price.” – Pedro Piccoli Soares
“I totally agree that behavioral economics cannot generate as much value as pricing departments can generate. And it’s, on the other hand, a much nicer topic to talk about to show results. You can definitely play around and create experiments, and you can very easily show the results of a try, and it's something that calls people attention because it's actually behavior, and that's something that they do as well, right? So, everybody wants to listen and to hear about heuristics, or the mistakes, the biases that they take when they're making decisions. And that's why I think it's a topic that costs more attention than pricing.” – Pedro Piccoli Soares
“When you have two different people, we have so many different characteristics that it's harder to compare. And if you have just two similar options, one, which is clearly worse than the other, you make the choice easier.” – Pedro Piccoli Soares
People / Resources Mentioned:
- SIXT: https://www.sixt.com/
- Dan Ariely: https://danariely.com/
Connect with Pedro Piccoli Soares:
- LinkedIn: https://www.linkedin.com/in/pedro-piccoli-soares/
- Email: piccolisoares@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 16, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/another-netflix-price-increase/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
The whole point of pricing, value-based pricing, is to charge what customers are willing to pay. And almost by definition, loyal customers like us more, they would be willing to pay us more.
This is the big exception to the rule of charge what a customer is willing to pay. My intent when I do price segmentation and charge different customers different prices is I also want to think about the lifetime value of a customer.
If you have a customer who loves you, they're very loyal to you, and yet they find out that you are charging them more than anybody else, it will upset them. You have a really high probability of losing them as a customer. And if you do, you lost the lifetime stream of value.
So, my advice, treat loyal customers really, really well, and don't charge them more than other people.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Duane Dufault is currently a Fractional CRO at Forward and is a Strategic Advisor at Abaqus Inc. Before this, he was Fractional VP of Sales at The RockED Company Inc. Duane is a dad of four lovely daughters.
In this episode, Duane shares the power behind having all departments in a company understand value in order to help the customer see and understand value as well in accordance with their reasons for buying a product.
Why you have to check out today’s podcast:
- Discover why it’s important for you to teach your sales reps to unpack value and not create it
- Find out why it’s a must for you to help people understand what it is that they’re actually paying for upon purchasing your product
- Understand the reason behind having clients voice out their problem and a salesperson being able to connect the product as a solution to what a client needs to be solved
“Just make it easy, seriously. The easier you can make it for people to figure out the pricing on your product, the easier it is for them to buy. Simple.”
– Duane Dufault
Topics Covered:
01:15 – The connection between Duane’s role and pricing
02:14 – That time when Duane realized the immense need for product management to focus on pricing
05:26 – Talking about the similarities and differences of product marketing and sales roles
09:50 – Should salespeople have the authority when it comes to pricing?
14:36 – Why salespeople need to unpack value, not create it
17:12 – Reminiscing Mark’s first few years as a salesperson
18:42 – Making a difference in the market in relation to value and what the customer’s needs are
23:08 – The difference between a CRO and a VP of Sales in Duane’s perspective
25:27 – Duane’s piece of pricing advice for today’s listeners
Key Takeaways:
“One of the growth levers that I was looking at is like how was pricing structured for whatever product it is because that's a really big indicator on how people are going to buy from your company. If you've got hard to understand pricing, that's a problem. And that's friction in the buying process that you need to remove.” – Duane Dufault
“Product marketing and a good sales process are like two sides of the same point. It's like sales and marketing, but like, a good sales process and product marketing is so closely tied, because the questions that a good product marketer asks are a lot of the same ones you get from a sales conversation, a discovery process, and they take them down the same path.
“Product marketing is fascinating from my perspective because you need to have a certain perspective on customer engagement and usage to understand how to shape and evolve both the product, the customer journey, and what they pay for the product.” – Duane Dufault
“If you've got a sales rep that's very, very focused and narrow-minded on one specific area, they can't pull from other experiences.” – Duane Dufault
“Teach your reps how to unpack value, not add value.” – Duane Dufault
“If you come into your discovery process with a deck that just has a whole bunch of bullets of stuff that came from the marketing page, that's not a value to them. They only find it valuable when they find it valuable, and it's only valuable when it solves a problem. And you can't solve a problem until you ask him what those problems are.” – Duane Dufault
“If you have a good discovery process that's focused on the needs of the buyer, you're going to help them figure out what those differences are, because people buy on an emotional trigger, and then cancellation happens when they find those little things that don't meet up with what they really want to do. In the sales process and marketing, marketing is there to take feedback from products, to then communicate what everyone gets from it, so that way, when the prospect gets the salesperson, it's the salespersons job to unpack those little things, because those little things are going to be the reason why they don't cancel in a year.” – Duane Dufault
People / Resources Mentioned:
- Metric Manager Playbook:https://themetricmanager.com
Connect with Duane Dufault:
- LinkedIn:https://www.linkedin.com/in/duanedufault/
- Email: duane@sellingsaas.io
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
- Website:https://www.duanedufault.com/
This is an Impact Pricing Blog published on February 9, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/you-must-lose-on-price/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Salespeople love them to death, however, it's more important to them to close the deal than to close it at the highest possible price. In fact, if they stay and negotiate a little bit harder, they're at risk of losing the deal. And if they lose the deal, they lose their commission. They lose the ability to reach their quotas.
So, for them, their incentives are a little bit askew from what our incentives should be. And when I say our, let's say the company, the owners of the company, or us as pricing people, where we want to try to win deals at the highest possible price.
So, although salespeople are really selling value and they're doing their best, in the end, price is just one of the many tools they have to try to close a deal and they're going to use every tool they have.
So, I don't think salespeople should own pricing.
Sure, we should give them a little bit of flexibility, a little bit of price authority to help them move deals along quicker, but to give them complete authority, probably a big mistake.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Ray Ranga is currently the VP of Product Management at Momentive AI. Before working in Momentive, Ray was the Senior Director of Product Management at Splunk. Ray is an instructor at UC Berkeley and he also conducts a pricing class at Stanford.
In this episode, Ray discusses the power behind involving the people who know the product’s value when making pricing decisions as he specifically points out the benefits of having pricing teams connect with people from the product management department.
Why you have to check out today’s podcast:
- Discover which team should own pricing in a company in relation to the value the product has;
- Find out how to effectively package products in a way that resonates best with what your customers want; and
- Understand why pricing and product management people should be one when making pricing decisions towards their product
“Understand your customers to a deep, deep level. See what gets your customer ticking, and then I'm sure everything else follows.”
– Ray Ranga
Topics Covered:
01:31 – How Ray got into pricing: From being an engineer then shifting to product management
02:31 – Answering the question “who should own pricing?”
04:50 – The role of product management
05:37 – What Ray teaches in his pricing and product management/marketing class
07:43 – The difference between behavioral economics and pricing for value
10:17 – How to package products, explained in the simplest possible manner
15:44 – Why you should go for market segments first, not across market segments
18:13 – The similarities of Mark and Ray’s practices when figuring out market segments
21:42 – Talking about the presence of confidence problem with regards to charging a high price
25:01 – Ray’s piece of pricing advice for today’s listeners
Key Takeaways:
“Pricing and product management need to go hand in hand.” – Ray Ranga
“Product marketing is good on pricing. They understand our customers well. They understand the persona and the segment we sell into typically. I do have a bias towards who should not own pricing. I feel like finance or sales should not own pricing, for some obvious reasons. But other than that, I think product management and product marketing are fine owning pricing.” – Ray Ranga
“Pricing is a number at the end of it, but it's so much more. It's so much more about operationalizing pricing, and that's where customer experience comes into play. You need the right ways to consume the price of the product that you just priced.” – Ray Ranga
“Analysis and research and competitive positioning is very useful. And I think, sometimes, you should take that seriously when you have the data points in front of you.” – Ray Ranga
“Enablement is very key to pricing, especially in zero to one products. You want to be with the sales team in those initial calls until they feel comfortable that they can tackle these questions about pricing in the early days.” – Ray Ranga
People / Resources Mentioned:
- Momentive AI:https://www.momentive.ai
- Splunk:https://www.splunk.com/
- SurveyMonkey:https://www.surveymonkey.com/mp/enterprise/?ut_source2=en
- Predictably Irrational:https://danariely.com/books/predictably-irrational/
- LinkedIn:https://www.linkedin.com/
Connect with Ray Ranga:
- LinkedIn:https://www.linkedin.com/in/rayranga/
- Email: emailranga@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on February 2, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/losing-on-price-2/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on January 26, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-perspective-on-rfps/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Jon Lucas started as an Accounting Manager before working as the Strategic Pricing & Business Development Manager of Cornerstone Building Brands Inc. Jon loves hiking, and he is loving it even better since he moved out of Ohio.
In this episode, Jon engages in a discussion with Mark Stiving about making price changes in relation to the importance of value and volatility of costs in the market nowadays.
Why you have to check out today’s podcast:
- Discover the importance of differentiating your business with the general market when thinking about value and making price changes;
- Learn how you can manage cost volatility and even add value when deciding on your products’ prices; and
- Find out why a safe and sound relationship with the sales team is a must when you’re doing pricing
“To experienced pricing managers, structure your department, borrow what everybody else in the organization is doing and have an org chart. Put some procedures around it. It kind of sounds like common sense, but I honestly don't see that happening in pricing in a lot of organizations.”
– Jon Lucas
Topics Covered:
01:21 – How Jon got into pricing; Was it about value or cost plus at first?
03:00 – Jon discusses what Cornerstone does; Thinking about value and differentiating oneself in the market
07:19 – How Jon adds value as he manages cost volatility when making prices
11:29 – Rapid cost fluctuations in the industry as an excuse to change prices frequently
12:35 – Jon talks about Cornerstone’s sales cycle
15:35 – How SAS-based programs help Jon and the company in terms of pricing
16:43 – Does Cornerstone change prices weekly?
19:04 – Jon shares what it’s like working with salespeople
21:03 – Jon’s piece of pricing advice for today’s listeners
22:38 – Having more things to do beyond the role in pricing; the resistance to take on pricing projects
Key Takeaways:
“When costs move, we know we need to make some kind of pricing move, and it doesn't have to be the same as the cost index. Costs could go up 5%. That doesn't mean we're necessarily going to go up by 5%, because that's where we get the value.” – Jon Lucas
“You can kind of use the cost fluctuation as the starting point, then we look at where the value is, and that's where we set our prices.” – Jon Lucas
“If you think your competitors are only getting up: if we're making a price decisions every week and they're making price decisions once every six weeks, we've got a much better chance of capturing more margin.” – Jon Lucas
“You can put some safeguards around your cost volatility to some degree with the way that you write your contracts. You can kind of do some hedging there. But you're predicting things out in the future, and it's not always going to be perfect. You just got to do the best you can.” – Jon Lucas
“You could have the best pricing in the world that you want to charge, but if you can't get it to your customers in a way that works for them, then you're nowhere.” – Jon Lucas
People / Resources Mentioned:
- Cornerstone Building Brands Inc.: https://www.cornerstonebuildingbrands.com/
- Zilliant: https://www.zilliant.com/
Connect with Jon Lucas:
- LinkedIn: https://www.linkedin.com/in/jon-lucas-84557840/
- Email: jonwilliamlucas@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 19, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/dont-confuse-your-buyers/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
I'm going to try to do a little math with you on this podcast, and imagine we have a company that normally makes a hundred million dollars in revenue. They've got costs of $90 million all in. So, they're making $10 million in profit. And that's not unrepresentative, that seems pretty reasonable for a lot of companies.
But what happens if we could increase or improve our pricing by 1%? So instead of a hundred million, what if we got 101 million in revenue? Our costs don't really change so instead of 10 million in profit, now we're making 11 million in profit. That 1 million in improved pricing went straight to the bottom line. And in the example I just gave you then, a 1% improvement in pricing can lead to a 10% increase in profitability.
This is huge.
We should be looking for small places where we can increase pricing because every dollar, when we improve our pricing, goes straight to profitability.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Anne Warren is the Senior Director of Global Pricing at Shure – an appliances, electrical, and electronics manufacturing company that produces best-in-class audio products with high-quality performance, reliability, and value. Anne started out as an accountant and an auditor. She's been leading pricing teams for about 20 years now.
In this episode, Anne shares the power behind pricing people working with sales, finance, and marketing departments in order to better market a product in a competitive market.
Why you have to check out today’s podcast:
- Discover why pricing people serve as the connector between the finance, marketing, and sales departments of a company;
- Understand why rapport with those internally involved in the business is essential in marketing a product; and
- Know how you can establish an effective rapport with other teams aside from yours through tips from an expert
“Establishing the rapport, especially with the sales and leadership team, treating your sales leaders as business partners, and make sure they know – not that you're going to necessarily agree all the time – but that they have a voice and you are going to be collaborative with them.”
– Anne Warren
Topics Covered:
01:40 – From being an auditor to becoming a pricing person
03:20 – Pricing people being that connector between finance, marketing, and sales
05:41 – Learning about the need to be collaborative across these departments
06:38 – How Anne works with salespeople
08:42 – The context of Anne’s script when talking to customers
10:24 – Mark’s four points with regards to writing a price increase letter
11:09 – Why raising prices shouldn’t be an intimidating initiative
13:33 – How Anna does what needs to be done while working with finance and salespersons
14:59 – Marketing people know the value of their products better than pricing people
16:23 – Seeing the collaboration in different perspectives
18:08 – Having a value statement and being able to share it
19:35 – Product managers being too far removed from value
22:18 – Anne’s piece of pricing advice for today’s listeners
Key Takeaways:
“It’s important to take yourself outside of your role as a pricing person or as a finance person, and really think and learn, most importantly, about the other person's goals.” – Anne Warren
“It's the pricing person's role to be that connector between finance, marketing, and sales.” – Anne Warren
“Being transparent. Don't try to hide. Don't try to be mysterious. Be honest with your customers. I think that will definitely go a long way. And the letters that go out are fine, but I think a live discussion between a salesperson and their customer works wonders as well.” – Anne Warren
“You want them to feel good about their product. You want to help call out that value proposition maybe in more less technical terms, if it's a technical product, and more about the value prop to the end user customer or B2B customer. What's in it for them and how can we monetize that? Help bridge the gap to get the salespeople confident.” – Anne Warren
“Never underestimate the power of a confident salesperson.” – Anne Warren
“If you're starting a new job as a pricing professional, I feel strongly you also need a good relationship with finance, but the sales teams in particular, if you have good rapport with them, you're going to make huge inroads and be very successful as a pricing professional.” – Anne Warren
“Try to be as natural as you can be, as open and transparent. What is your role? Your role is to be a partner. That is the first message you should deliver to establish that rapport and mean it. Be that partner and establish that early on in the relationship. That's the best thing you can do that will give you firepower for initiatives that you want to perform later on.” – Anne Warren
People / Resources Mentioned:
- Shure Incorporated: http://www.shure.com
- Ameritech / AT&T: https://www.att.com/
Connect with Anne Warren:
- LinkedIn: https://www.linkedin.com/in/anne-warren-214ab745/
- Email:annewarren720@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 12, 2022, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/willingness-to-accept/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
When we think about pricing, typically we have a product in hand and we say, how much does our customer value this? How much are they willing to pay? Now, we're going to put a price tag on that.
And that's really important. We want to be able to do that well. And that's typically what we think of when we think of pricing.
But if we take a step or two backwards in the business process, the fact that we as pricing people understand value, we understand how customers perceive value. Imagine if the product managers or developers or whoever's defining the products that we're going to build, imagine if they understood this concept of value the way we understand the concept of value. Because then they could be creating products that our customers actually value.
“The less obvious but more powerful part of pricing is creating value.”
- Mark Stiving
If we think about the products or the features that we create and how they drive value, we'll end up creating better products, products that our customers love more, products that we can charge more for.
So, yes, product management, the creating value part, is huge.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Shantanu Basu is currently the Senior Director of Go-To Marketing Strategy and Operations at Tanium. He was Director of Strategy and Operations at Intel for a long time, and he's part of an organization called RevGenius. Shantanu got his MBA from the University of Michigan.
In this episode, Shantanu discusses value chain alignment alongside the importance of knowing what your value is and understanding what your customers think what your value is.
Why you have to check out today’s podcast:
- Discover why knowing your company’s value and understanding how your customer sees value in you when doing pricing;
- Understand the importance of doing things one at a time, especially when communicating about the company’s value chain; and
- Find out why it’s necessary for you to be able to ask the right value chain alignment questions
“When you think of yourself as a pricing professional, you're doing your pricing jobs so to speak, don't limit yourself to what somebody else might consider the definition of your job. As a pricing professional, you should be able to ask questions and articulate – if you ask the right questions; articulate the value of your product across the entire value chain.”
– Shantanu Basu
Topics Covered:
01:47 – How Shantanu got into pricing alongside the discussion around capturing and communicating value
04:20 – Knowing your value vs. understanding what your customers think your value is
10:34 – How he communicates with people to help them understand how the value chain inside that company looks like
13:57 – The difference between being right and being effective in doing pricing
17:58 – How to align product positioning with packaging
22:34 – Discussion around the good, better, best framework
26:35 – Briefly talking platform pricing and how it intersects with good, better, best
30:49 – Shantanu’s piece of pricing advice for today’s listeners
Key Takeaways:
“Do you understand how value is created for your product, your business, your industry? Do you know how to communicate and then, hence, capture that value? It starts and ends with value. As long as you can connect those different points along the value chain, you perhaps have something to go to market with.” – Shantanu Basu
“Change comes from understanding. If I don't understand how my product positioning team and/or my sales team thinks our value is, I don't know how to influence that change, assuming I am right in understanding what the customer said.” – Shantanu Basu
“Every time there is a shift to be made from our steady state, you start to ask these questions and go try to reach as far back into the value chain as you can without pissing off too many people and slowing down business. It becomes an art rather than a science.” – Shantanu Basu
“Change management is not about right and wrong or numbers or the customer. It's about people and the emotions and maneuvering the informal dynamics of an organization, which I would like to think it only comes with experience.” – Shantanu Basu
“Pricing isn't rocket science. Influencing change via pricing and influencing the right behavior – whether of your customer, your sales rep, your CEO, or your customer success person – is where the art comes in.” – Shantanu Basu
“You don't have to be an expert in every piece of the value chain. That's not your job. There are people who will always do better than you. But stretch all the way down the value chain and all the way up the value chain and feel free and empowered to ask questions at each point so that you understand the entire value chain. Because when it comes down to this “simple piece of pricing”, your understanding across the value chain is what's going to probably provide the best results, not just coming up with a number and not just coming up with X.” – Shantanu Basu
People / Resources Mentioned:
- Tanium: https://www.tanium.com/
- Stephanie Hallford: https://www.linkedin.com/in/stephanie-hallford-ba90732
Connect with Shantanu Basu:
- LinkedIn: https://www.linkedin.com/in/basushantanu/
- Email: basu@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
We all know that price is a signal of quality, but what ends up happening is, over time people learn what the true quality is, and they realize if the prices match that true quality or not. If we're able to price relative to our true quality, then all is right with our customers in their minds and they're not going to change their purchase decisions. They're more likely to stick with us.
Now, what happens if we deliver a ton of quality and we charge a low price? Well, first off, maybe a lot of people aren't going to find out because they're using our price as an indicator of quality. And they say, oh, that's way too inexpensive. It's not a product that would fit my needs. So, they never learned that yours is great. Once of course, someone buys in and they start using it, then sure, they say, hey, this is a fantastic deal. Maybe they talk about it, word of mouth. The question becomes, can you get people to buy it because it's such a low price.
On the other hand, let's say you charge a really high price for something. And then they take it home, they realize, oh, this really isn't worth that price. Now we get negative word of mouth. People tend not to buy. They're certainly not going to buy again.
“Price is a signal of quality.”
- Mark Stiving
It's so much easier if we could figure out what our quality levels really are and set our prices consistent with what those quality levels are. It's a great way to build a long-term sustainable business.
We hope you enjoyed this memecast. If you have any questions or feedback, please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
There's a concept in economics, behavioral economics, called reference prices. And reference prices really say our customers have some expectation about what they think they're going to pay.
And if our price is below that expectation, they get a good feeling they're getting a good deal.
And the fact that they're getting a good deal provides them an incentive or the good feelings that say I'm actually going to buy.
Richard Thaler broke this up into two different types of utility. There's transaction utility and there's functional utility.
The functional utility is the utility that someone gets from our product. It's the reason they're buying it. But transactional utility is the feelings you get when you're going to buy something.
And if you walk into a store expecting to pay $20, and you find it on sale for 15, you're thinking, Hey, that's a really neat deal, I'm going to buy that. Or you're more likely to buy it.
"We should be paying attention to our customer's expectations." - Mark Stiving
If we have a way to control expectations, to raise expectations before they actually buy, and then we give them a price that's below those expectations, it makes it more likely they'll pull out their wallet and buy from us.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
José Vela is the Director of Pricing at Spandex Barcelona, known as one of the leading suppliers of graphics and digital materials worldwide. He is a strategic and business savvy leader who empowers business development and profitability improvements for global businesses, with an expertise in directing international trade, manufacturing, and services operations. José moved into pricing after having a General Manager's role.
In this episode, José talks about the importance of getting the right price in selling your services as he relates it to the change and value you’re providing to your customers.
Why you have to check out today’s podcast:
- Understand why it’s a must for you to be able to price your products and services right in relation to winning more deals even at a high price;
- Discover how experience adds up to a pricing person’s credibility, therefore, resulting to high rates of success in sales; and
- Find out how necessary it is for you to think like your customers in order to provide the best value in the market.
“You need to be able to analyze your own data in order to identify where your margin, your profitability is, what are the leakages, and then you need to act on them.”
– José Vela
Topics Covered:
01:49 – Getting into the world of pricing: Winning more deals through knowing the right price
05:52 – General managers providing more credibility to the table and being able to demonstrate success through experience
09:00 – The value being present on the extended product; thinking like the customers
13:15 – Building the analytics capability to prove the impact of pricing decisions
16:49 – Why list prices matter so much
18:00 – How to effectively manage list prices in relation to the benchmarks
23:07 – José’s piece of pricing advice for today’s listeners
Key Takeaways:
“Most of the time, sales people – they are driven when we are talking about pricing. They are driven by fear. They are afraid of losing the deal, losing the customer if they base off them. And if you are able to provide them data, reliable information, they feel more confident and they know that they can offer a right price and they know it right because other similar customers are paying.” – José Vela
“Country managers are really competitive. We are competitive animals and we know to overperform. We want to overachieve. And if we see that some of our colleagues are succeeding, we want to know what's the deal, what's going on there, because we want to replicate this, these tools, those processes, whatever they are doing to succeed. We want to make sure that we are doing the best in order to succeed too. So, if you are able to find early adopters that are able to show and demonstrate quick wins, this also helps a lot.” – José Vela
“The impact of pricing is, how do we manage the list prices? And how do we manage the discounts that we are giving to our customer? The main driver for margin value is – without any doubt – how do you manage your pricing? And if you are not able to organically growth a lot for whatever the reason, how you manage your list prices is the biggest driver to increase your revenue.” – José Vela
“In general, it's not just pricing the prices. It’s making the right price. Pricing goes in two directions. It’s not only about rising prices. Sometimes, you decrease.” – José Vela
“Most of the pricing initiatives, the critical piece is never the technology, or at least from my point of view, because there are different ways to do stuff, different platforms, but how do you manage the change? How do you train the people? How do you make them feel comfortable and embrace the change? That's the most difficult part. Ever. Always.” – José Vela
People / Resources Mentioned:
- Spandex: https://www.spandex.com/
- Toyota: http://www.toyota.com/
Connect with José Vela:
- LinkedIn: https://www.linkedin.com/in/jvela/
- Email: jjvelar@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on January 5, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/opportunity-costs-and-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
As pricing professionals, we really need to be the logical part of the business.
Our product lines, they really want higher prices. Sometimes they become emotionally involved with their products and they think that they're worth a ton - and they probably are.
Have we explained the value to the customers? Are we able to capture all those higher prices?
"We pricing professionals are the fulcrum of the business. Product lines want higher prices, sales want lower prices. " - Mark Stiving
And what we want to do as pricing people is make sure we understand whether or not we're communicating value well to the marketplace.
And if we're not communicating value, maybe we're discounting so that we can at least win some business.
So we're almost like the dispassionate referee. We're trying to say, hey, it makes more sense for us to price this way if we want to maximize profits.
On the other hand, salespeople, customers too, what lower prices. Salespeople have prices, one of their tools to close a deal. When a customer asks for a lower price, it's easy for sales to come back inside and ask us for lower price.
Again, we need to be that dispassionate referee. Have we truly explained the value to the customer?
Do we know how much value that customer is going to be getting? And can we hold that price up a little bit without going for deep discounts?
So in the end, we, the pricing professionals, are that fulcrum. We're trying to find the logical center of where prices should be.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Paul Orlando is the Founder of Startups Unplugged and is the author of the book “Growth Units”, a book that makes unit economics straightforward. He builds incubator/accelerator programs around the world, getting companies to solve problems that they couldn’t in other ways, which allows the building of autonomy and skills that keeps employee retention high and maintains the company’s top talent. Paul is an adjunct professor and runs the incubator at USC.
In this episode, Paul talks about calculating lifetime value as he shares why it is important to think about pricing in relation to the LTV.
Why you have to check out today’s podcast:
- Understand the relationship lifetime value has with pricing and why it’s better to learn early and often than to fail fast
- Find out why overpricing and underpricing are present in various companies
- Discover why your lifetime value isn’t and will never be limited to one number
“People are really afraid of raising prices. I think it was Marc Andreessen who said, 'a lot of problems go away if you can raise your prices.'”
– Paul Orlando
Topics Covered:
01:22 – How Paul got into the work of running incubators
03:16 – Building incubators and accelerators inside a company and changing the way people work to achieve a certain goal
06:05 – Why ‘learn early, learn often’ is a lot better than ‘fail fast’
08:32 – Writing a book about calculating lifetime value and its components; why thinking about pricing is important
17:15 – Pricing and lifetime value; discussion about over- and underpricing
21:00 – Thinking about lifetime value in relation to subscription and non-subscription businesses
26:03 – Your lifetime value is and will never be limited to one number; why you should model the sequence of flows
29:56 – Why Paul prefers using payback time as a metric as opposed to LTV/CAC
31:23 – Paul’s pricing advice for this episode’s listeners
Key Takeaways:
“I actually don't want people to fail fast. I don't want them to fail slow, either. But I'd rather that they succeed fast, or second-best – succeed slow. So, I'd like to say, learn early learn often rather than fail fast. Learn early - encounter the customer upfront rather than downstream, and learn often - keep that process going like you really probably have not figured everything out just yet. You need to keep iterating. There's so much that you could test before you have committed serious resources.” – Paul Orlando
“If price is some metric of value or some measure of value, you want to be able to charge something. You don't necessarily want a business that has to push prices as low as possible.” – Paul Orlando
“Lifetime value is not something that you can really get a full picture of until you've been out for a while.” – Paul Orlando
“These ratios or numbers that you hear about can be misleading unless you actually start digging in a bit.” – Paul Orlando
“If you can start to either shorten that time, taking pre-orders, or if there's something that you can do with your own supply chain, tough today, but if there's something that you could do there, you could improve your odds of being able to use customer revenue to grow.” – Paul Orlando
People / Resources Mentioned:
- Growth Units: Learn to Calculate Customer Acquisition Cost, Lifetime Value, and Why Businesses Behave the Way They Do: https://www.amazon.com/dp/B08GJVV8RJ/
- Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business: https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784
- MoviePass: https://www.moviepass.com/
- Uber: https://www.uber.com/
- Dollar Shave Club: https://www.dollarshaveclub.com/
- Amazon Web Services: https://aws.amazon.com
- Coke: https://us.coca-cola.com/
Connect with Paul Orlando:
- LinkedIn: https://www.linkedin.com/in/porlando/
- Email: orlando@gmail.com
- Twitter: https://twitter.com/porlando
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 29, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/call-it-customer-impact/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
As far as loving you is concerned, obviously, they love low prices; they love discounts. But the real love happens when we can deliver a ton more value than what they expected, what they actually have to pay for.
These are the raving fans, the people who really value our products. And yet we couldn't capture all of that value even if we wanted to.
“Pricing has the power to make your customers love you, hate you, or anything in between.” - Mark Stiving
As to hating you, customers will absolutely hate you when you raise their prices without some reasonable explanation, without doing something nice for them, because customers hate price increases.
And of course, if our pricing is just ridiculous; if it's horrible, for whatever reason, they will learn to hate us. So pricing really is very powerful, it causes emotions inside our customers. We want to make sure we're managing those emotions carefully.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Damien Robert is currently the Chief Solution and Delivery Officer at Pricemoov. He's been at Simon-Kucher & Partners (SKP) for 17 years of his career so he actually understands pricing really well. Damien also took a three-year stint at Disneyland Resorts Paris. Damien develops and implements tailor-made pricing solutions, ensuring easy price steering across the organization. In this episode, Damien talks about Machine Learning and how it helps optimize inputs in the pricing work as he shares insights in relation to Pricemoov’s models.
Why you have to check out today’s podcast:
- Find out what Machine Learning (ML) and Artificial Intelligence (AI) are all about and how these two are used in pricing
- Discover simple and advanced pricing strategies you can implement to reach a bigger market
- Understand why looking at price in the perspective of your client is a good move towards success
“Look at your prices with the client view.”
– Damien Robert
Topics Covered:
01:32 – How Damien got into pricing
02:34 – What does pricing mean for Damien
04:28 – Damien’s pricing story when he was still in Disneyland
06:25 – What makes Pricemoov different in the pricing market and how Damien got involved with them
08:50 – Simple and advanced pricing strategies people can implement
10:57 – Collecting competitive pricing information with car rental companies
13:00 – Defining Machine Learning (ML) and Artificial Intelligence (AI) alongside the things they do
16:45 – Using ML to forecast the effects of the decisions made for pricing
19:54 – Mark’s Amazon story: his $20 book reaching a price $225 in Amazon
22:00 – Damien working in a theme park, the existence of black box
24:57 – The things Pricemoov considers when making pricing models
27:00 – Damien’s pricing advice for today’s listeners
Key Takeaways:
“Pricing is not only a price, but also the way you message it and what you can achieve.” – Damien Robert
“Our software is allowing you to configure the rules that we provide. So, you have a set of rules, you, yourself, decide which one you want to use and implement for your product portfolio, because you may want to use one or another one, and we can basically train you on which one you want to use.” – Damien Robert
“That's what people misunderstand. Sometimes in machine learning and artificial intelligence, they think that the model by itself can be smart. The reality is that the model is not smart, but the model can be much more granular and fit much more kind of situations because his granularity and the computer allows, basically, to have so many computations and so many different alternatives.” – Damien Robert
“Somehow, machine learning can be used to optimize part of the dimension, some of the inputs, but basically, at the end of the day, you need a skeleton of decision making, which is important to have. Otherwise, you do not take the long-term impact of price changes. You do not take the potential competition reaction. So, you're missing a lot of the points.” – Damien Robert
“Very frequently, you just optimize, set a price, but you do not check the consistency, you do not realize some of the price points, and you won't even realize that the way your prices are featured on the web is sometimes a catastrophe. So really, just look at the end of the tunnel and look at it because you will have a lot of surprise, especially on promotion. 50% of promotional faders are usually related to execution. It's not at all related to the design of the promotion itself.” – Damien Robert
People / Resources Mentioned:
- Pricemoov: https://pricemoov.com/
- Simon-Kucher & Partners: https://www.simon-kucher.com
- Tesla: https://www.tesla.com/
Connect with Damien Robert:
- LinkedIn: https://www.linkedin.com/in/damienrobertpricemoov/#
- Email: robert@pricemoov.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 22, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-art-of-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Real value comes from real differentiation. Real value is turned into perceived value through marketing.
When we're up against the competition, which most of the time we all. Our customers are buying perceived differentiation.
They look at our product or competitors' products. What's the difference in price and is it worth it? And the, ‘is it worth it’ has everything to do with the difference in capability, the product differentiation, the features that are different.
“Build real differentiation, but we have to make sure our customers know it.” - Mark Stiving
Now we may have built the best product in the world. We may have built a product that is much, much better than our competitors, but if our buyers don't know that.
If they don't believe that, then they're not going to choose our product buyers.
Aren't buying based on real differentiation?
They're buying on their perceptions or what we'll call perceived differentiation. Our job as a company should be to build products that are truly better than our competitors.
In other words, build real differentiation, but we have to make sure our customers know it.
And that comes through marketing. It comes through sales efforts. We have to make sure we're communicating the fact that our product is better/different than our competitors.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Ebrahim El-Ebiary is a Pricing Manager at Goodyear Tires. He’s been with Goodyear for six years now, having worked in Revenue Management at FedEx before that. Ebrahim is a Professional Certified Coach and he's genuinely interested in people and how they think. In this episode, Ebrahim talks about the importance of curiosity and good relationship to your pricing practice as you continue to make money through helping your customers do the same.
Why you have to check out today’s podcast:
- Learn about what revenue management is and the relationship it has with pricing
- Understand why it’s important that pricing people understand their customers’ future while having the customers take part in the creative process
- Find out about the benefits of having a good relationship with your customer and keeping that relationship until it lasts
“Before launching a very detailed analysis, ask the question, ‘how will this be used?’”
– Ebrahim El-Ebiary
Topics Covered:
01:11 – How Ebrahim got into pricing
01:59 – Revenue management’s relationship with pricing and yield management
03:48 – Does Goodyear have revenue management?
04:40 – Defining a coach and what a coach does; Is Mark a coach?
06:05 – Pricing and coaching as different sides of the same coin
07:50 – Why curiosity is important in keeping relationships with customers
09:27 – Questions to ask in order to better understand a customer’s future
11:53 – Why it’s important for tires to be talking to each other
14:26 – Where the idea of communicating tires came from
15:42 – Having the customers take part in the creative process and keeping that relationship with them
19:08 – Being in a zero-sum game situation of price negotiation
23:12 – Expressing complex analysis into simple statements to not lose your customers
26:32 – Pricing advice for today’s listeners
Key Takeaways:
“A coach is someone that supports people getting from where they are to where they want to get to, not where he or she wants to get, where they want to get to. A coach does not tell you or does not impose their point of view.” – Ebrahim El-Ebiary
“Making money is “the easy part” of it (doing business). Having the story and the vision, now that's where moneys truly made in a sustainable manner.” – Ebrahim El-Ebiary
“Discovering the future comes from asking about the legacy that they want to build mixed with free flow working sessions where we pick on each other's ideas jointly.” – Ebrahim El-Ebiary
“One thing remains at the heart of business is people. Once we lock in that relationship of trust and joint creativity, then we come back to do business together. That relationship then grows and flourishes, and with that, profits grow and creativity grows and the demand for new products that didn't exist or new services from existing products come to life.” – Ebrahim El-Ebiary
“Know the question you're trying to answer before jumping into a detailed analysis or investing in a pricing system software, hiring more people. Just know what question you're answering.” – Ebrahim El-Ebiary
People / Resources Mentioned:
- Goodyear Tires: http://www.goodyear.com/
Connect with Ebrahim El-Ebiary:
- LinkedIn: https://www.linkedin.com/in/ebrahim-elebiary/
- Email: ebiary@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 15, 2021, turned into an audio podcast so you can listen on the go. Read Full Article Here: https://impactpricing.com/blog/the-best-attitude-for-a-great-value-conversation/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Costs don't drive pricing, willingness to pay drives prices.
I remember 1989. Yes. I'm that old? I was selling automatic test equipment to the semiconductor industry, and I heard this story on the radio that changed the way.
I thought about pricing and costs forever. Intel built the 46 DX, which is the very first dual-core microprocessor in the world. Very expensive.
Of course, AMD decided they were going to create a single core version and they charged a much lower price.
So they've taken a lot of business away from it.
Yeah. Intel's thinking ‘Hey, we better do something’.
So Intel creates a single-core version of their microprocessor and they charge a price more competitive with AMD. And so now they're not losing quite as much business. Now, this story makes all the sense in the world until you learn how Intel made the SX.
They first made a DX, a dual-core processor, and then they took an extra manufacturing step with a laser to disable the coprocessor. It actually costs them more to build an SX, a single-core version than it did to build the dual-core version.
And yet they sold it at a much lower price. Well, how does that possibly make sense?
It makes sense because. Our costs. Aren't what drives our customer's willingness to pay?
It's the value to the customer that drives their willingness to pay.
We should stop overemphasizing our costs, especially when we're trying to set pricing. It's really about customer value.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Mark Stouse is the Chairman and CEO of Proof Analytics. He was 2020’s Top 10 Most Influential Analytics Leaders. He was also CMO/CCO at Honeywell Aerospace, so he has tons of experience. Mark also hosts his own podcast called “Accelerating Value”, a weekly podcast aimed at guiding people in creating, defending, and proving value with the help of experts.
In this episode, Mark discusses how analytics lead SaaS businesses to success as he shares insights most SaaS entrepreneurs need to know about the relationship between analytics and pricing.
Why you have to check out today’s podcast:
- Discover how a different way of consulting like analytics can help SaaS businesses to become profitable nowadays;
- Know how much of a game changer analytics is in terms of keeping the relationship between customer loyalty and pricing intact;
- Find out how the scientific sense of inquiry helps pricing people reach greater heights in relation to sales and pricing with clients
“It isn't that you say, ‘Hey, what are you willing to pay for this?’ That's not the question. You've got to say, ‘tell me about what you're really trying to solve for here and how big a problem is this to you. What would make you feel spectacular?’ Then let's talk about the technical realities, and then let's talk about a price.”
– Mark Stouse
Topics Covered:
02:02 – Getting exposed to pricing and learning things through failures with Mark’s experience in Honeywell Aerospace and Proof Analytics
04:06 – Diving into the world of pricing with the help of advisors he trust
06:41 – Starting out in a SaaS company and initially doing consulting: a good way for one to be profitable
09:02 – A different consulting model – analytics – for a better, faster, and cheaper reality nowadays
13:16 – Business and the gap it has with data scientists due to the lack of contextual understanding in both concepts
18:23 – What does Proof Analytics charge for and why is that the right thing for them to charge for?
20:20 – Talking about the concept of 10 models equals 10 questions and how COVID affected the business industry in the past two years
26:05 – The differences in the opportunity costs of small and large companies
30:23 – A model as an indicator of customer success and people’s obsession with margins
33:25 – What makes SaaS beautiful is that it concerns value at all times
35:30 – Mark’s pricing advice for the listeners
Key Takeaways:
“If you want to talk about a lesson in the reality of economics, start a SaaS company and you will learn more than you ever dreamed was out there.” – Mark Stouse
“The problem has been not the math and not even the data. It has been the issue of how do we operationalize analytics so that everybody is able to make a better decision today than they were making before when they didn't have analytics. It really is taking the existing reality and making it better, faster, cheaper.” – Mark Stouse
“Data scientists really don't typically have much subject matter expertise about any part of the business, so as the business person, you have to be very prescriptive with the data scientist in terms of laying out the non-mathematical equation.” – Mark Stouse
“If you're a very large enterprise and you're spending $150-$200 million on marketing, what you are really after is maximizing the upside and minimizing the negative impact EPS from bad investments. That's what you're really after. If you are a much smaller company, you're really trying to avoid, among other things, being a two-time loser.” – Mark Stouse
“The intersection of customer loyalty and pricing is also a piece that is usually ignored, because pricing is seen in a very short cycle sense rather than something that's a longer time.” – Mark Stouse
“The human being has become key to the success of set which probably really and truly always was or should have been. There was just this unhealthy obsession with 90% profit margins.” – Mark Stouse
People / Resources Mentioned:
- Proof Analytics:https://www.proofanalytics.ai/
- Honeywell Aerospace:https://aerospace.honeywell.com/
Connect with Mark Stouse:
- LinkedIn:https://www.linkedin.com/in/markstouse
- Email: stouse@proofanalytics.ai
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
Every single customer touchpoint customers are evaluating us. They're saying that was a good experience. That was a bad experience. If we mess up an invoice and they have to call to fix it, that's a bad experience.
And that destroys. But if our invoices are super easy to understand, and they tie back to all the previous paperwork and they make it easy for our customers to do their job, like, oh, pay the bill, then we're adding value. Even if it isn't our main product. Every customer touchpoint adds or subtracts value.
“Everybody in your company that your customer touches either adds or subtracts value, make sure they add value.” - Mark Stiving
This is obvious. When we think about the products we build and our customers touch our products, our products, great products, high quality products. It may be obvious when we think about marketing departments, because marketing is putting out communications and are those communications truly resonating?
Or are they just falling flat or maybe even offending? What about customer service? When someone calls to our customer service line or our customer service people are delighting our customers, or are a little bit annoyed and feeling bothered that a customer bothered to call everybody in our company creates or destroys value, we need to make sure they know they should be creating that.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 8, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-power-of-procurement-matters/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Vikas Pal Boaddh is the Senior Strategic Marketing and Pricing Leader at Honeywell. He started out as a Software Engineer but has switched careers after getting an MBA in Marketing and General Management. His pricing journey in Honeywell was a happy accident for him. His startup in Food Tech wasn’t working in his early years, so he was introduced to Honeywell’s pricing team. Now, he’s been with them for 10 years.
In this episode, Vikas discusses why value-based pricing is the right thing to do and shares why understanding how your customer thinks is a must in dealing with pricing.
Why you have to check out today’s podcast:
- Discover how important it is for you to understand the customer’s business first before making them understand how much money they’re going to make once they buy your product;
- Understand the four pillars of pricing frameworks in organization; and
- Find out how you can become more efficient in pricing through tips that will help you avoid repeatedly doing the same thing with progress.
“When you have an opportunity to price something, first, go and try to talk to the customers.”
– Vikas Pal Boaddh
Topics Covered:
01:44 – The happy accident that led to Vikas joining Honeywell
02:48 – What’s in the cost plus model that made Vikas passionate about it?
04:35 – Two things to take note of when implementing value-based pricing
05:51 – How Honeywell understands customers and their business
09:37 – Where should pricing sit in an organization?
10:53 – The difference in the roles of a pricing person and a product manager
12:32 – The first pillar in pricing frameworks for an organization
14:03 – The three other pillars of pricing organization
16:19 – The competition of having the credit for the price
18:36 – Where does Vikas put the focus when trying to become more efficient?
21:35 – Vikas’ pricing advice for listeners
Key Takeaways:
“Know the customers inside out. Understand your customer base. If someone doesn't know [their customers], they will find it difficult to implement value-based [pricing].” – Vikas Pal Boaddh
“It’s the pricing person's job to talk to the customers. Ask them about all the things which goes in their business, understand them, model them, dollarize them, and then set the price.” – Vikas Pal Boaddh
“As a pricing person, I have a key say in what the price should be, but I just said, the people who own the product – for example, operating managers – they are the people who are kind of holding the price for that. They should be doing a final sign off on that. As a pricing person, it's my role to provide all kinds of inputs and guidance to help them reach there.” – Vikas Pal Boaddh
People / Resources Mentioned:
- Food Tech:https://www.foodtech.com/
- Honeywell:https://www.honeywell.com/us/en
Connect with Vikas Pal Boaddh:
- LinkedIn: https://www.linkedin.com/in/vikas-boaddh-673a896/?originalSubdomain=my
- Email: Vikas0903@gmail.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on December 1, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-based-mindset-is-hard-for-an-organization/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Yes, pricing is really hard. I personally find it frustrating when I look at companies, doesn't matter the size of the company where they're focused a lot on how do we keep costs down?
How do we cut costs? We have procurement people. We hire specific procurement people whose job is to get costs down and their job is to learn how to negotiate better so that we can pay lower prices. And I'm not saying those are bad things. But, you know, pricing is so much more powerful. What if we could negotiate better on our sales side?
What if we could communicate value better to our marketplace? What if we understood value to where we could set our prices at a higher point and maybe even build products that have more value.
“Pricing is hard. There's no doubt, but that's what business is all about. It is definitely worth investing. I don't know why companies don't.” - Mark Stiving
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Kevin Coppinger is currently the Director of Analytics in Ferrellgas. He is passionate about leading groups that turn large data into an asset, providing leadership the opportunity for insights and actions.
In this episode, Kevin shares his analytics journey as he talks about the importance of data in providing better service and becoming a better service provider in the field.
Why you have to check out today’s podcast:
- Discover why data is power and how the understanding of it makes everything better;
- Understand why an analyst needs to be a good overall communicator if he wants to be good at what he’s doing;
- Find out how knowing your competitors help you understand where your company and your products should fit in the field.
“Figure out who your top three competitors are and find their biggest weakness and their biggest strength when it comes to product offering and price.”
– Kevin Coppinger
Topics Covered:
02:40 – Talking about his failed CPA journey and how it led him to pricing
05:57 – Discussion about insurance, price segmentation, and the cost-plus model
09:20 – Ferrellgas and what Kevin does as he works there
14:04 – Ferrellgas tank users vs. non-Ferrellgas tank users and using analytics for overall betterment
20:16 – Why a good analyst needs to be a good interviewer and communicator nowadays
26:37 – How his background in accountancy helped him in switching to analytics
30:01 – Kevin’s pricing advice for the listeners
Key Takeaways:
“Price is the most important signal that a company sends to its consumers but willingness to pay is almost as important as what they think of your actual product.” – Kevin Coppinger
“Customers would want to behave the way we wanted them to behave, so that they could control their price.” – Kevin Coppinger
“You should shop insurance every three years. I know it is a pain in the butt, it's a hassle to move it especially if you've got all of your property insured with one place, but every three years, you should call just to check. It keeps your insurance company honest and it will most likely keep a couple of dollars in your pocket.” – Kevin Coppinger
“The more we know about the house and the more we can connect into how they use their energy, the better we can be for them and for ourselves.” – Kevin Coppinger
“Good pricing can only come with good data, and good data is usually tied to good understanding of your prices.” – Kevin Coppinger
“Data is power. Pure and raw data is pure and raw power and it is scary and it needs to be a little bit controlled and molded a little bit. But if you can help a company, if you can help analyst hone that data better, they become smarter, their companies become smarter, and us – we, as consumers – will inevitably benefit if more companies start using their data to much more intelligent fashion.” – Kevin Coppinger
People / Resources Mentioned:
- Ferrellgas: https://www.ferrellgas.com/
- AmeriGas: https://www.amerigas.com/
- Ivan Winfield: https://www.linkedin.com/in/ivanwinfield
- Eaton Hydraulics: https://www.eaton.com/us/en-us.html
- Syngenta: https://www.syngenta.com/en
- Resideo: https://www.resideo.com/us/en/
Connect with Kevin Coppinger:
- Email: coppinger@gmail.com
- LinkedIn: https://www.linkedin.com/in/kmcoppinger
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 24, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-based-mindset-is-hard-for-an-individual/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
I've spoken with lots of CEOs who believe that they should get higher margins and they want higher margins. And, by the way, doesn't everybody want higher margins?
But the key is the CEO as well as pretty much everybody else in the company doesn't truly understand what value means to the customer.
And what that means is that the products they're building aren't necessarily. That valuable to their marketplace.
“Build products that deserve higher margins. “- Mark Stiving
If everybody could switch their mindset to believing in value, to understanding what customer value really looks like, we could truly build products that had a lot more value in the marketplace and then charging higher prices and getting higher margins.
That just goes along with building better products.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Scott Miller is an experienced pricing professional with over 12 years of proven leadership in achieving profit oriented sales growth through advanced pricing techniques. Currently, he works as the Vice President of Pricing at Fiserv. Scott guides the pricing team in developing creative proposals for clients on Fiserv sales of $3B annually. He successfully led and implemented profitable growth and pricing strategies in Fortune 500 companies across numerous industries.
In this episode, Scott shares insights in relation to his pricing journey, from the very start of being inspired by Neil Brisbane and now working as Fiserv’s VP of Pricing.
Why you have to check out today’s podcast:
- Discover how you can avoid cannibalization of your own sales in other regions as you start going global in business;
- Know why understanding the context – your customer, your competitors, and outside influences – is important in doing pricing decisions; and
- Learn more about formula-based pricing and its difference with cost plus pricing
“Understanding the context of the situation is key in making pricing decisions. Understand the customer's viewpoint, understand the competitors that are involved in that situation, even outside influences, as much as you can, a consultant or not. I think those are the key things, and I think those are what people should think about when they're pricing.”
– Scott Miller
Topics Covered:
01:24 – How Scott started his career in pricing and what he loves about it
4:11 – Talking about Scott’s exposure to different concepts, the rebates, and the relationship between pricing and the customers
8:29 – Leaving Motorola and working in Hollister
11:40 – Going back to Motorola in a global role, dealing with arbitrage, and taking the risk of currency fluctuations
15:55 – Scott’s new environment in Air Gas and the discussion about formula-based pricing’s difference to cost plus pricing
19:27 – Why do people consider the pass through of AWS costs? What should they consider in doing so?
24:10 – Starting his journey with Fiserv through LinkedIn
26:05 – Discussion about companies taking all their overhead costs which affect their product’s standard price
27:41 – “Understanding the context of the situation is key in making pricing decisions.”
Key Takeaways:
“We didn't have a ton of tricks. Mostly, it was just paying attention to our own selling price.” – Scott Miller
“We didn't deal with it [the risk of currency fluctuations] from the other side of trying to put the risk on the customers; we took the risk.” – Scott Miller
“The formula itself – coming up with something that's agreeable to both parties, you have to be kind of specific in how it ends out in the contract to make sure if for any reason that index goes negative on you, you’d want to make sure that that's not a price break. That this is only zero or up. It's not a ‘Now, we're going to start cutting costs because the index has went under.’ You have to be careful.” – Scott Miller
“Try to do it on a calendar date rather than like a 12-month from contract date, because you get into the business of constantly running these calculations. If you can get away with just doing it once a year, then maybe you're just looking at the labor cost once and the transportation costs depending on how you built those formulas. Otherwise, you're redoing it every time the contract comes due.” – Scott Miller
People / Resources Mentioned:
- Fiserv: https://www.fiserv.com/
Connect with Scott Miller:
- LinkedIn: https://www.linkedin.com/in/scottmillernetwork/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 17, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/freemium-or-free-trial/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Gross margin never matters to pricing. Occasionally, contribution margin does.
This might feel like accounting to you.
Gross margin, contribution margin…. but you've probably heard me say, 'Fixed costs never matter to pricing. Never, never, never.’
Now, if you believe that here's a really simple accounting concept.
“Gross margin includes allocated fixed costs to the cost of a product. Contribution margin does not include allocated fixed costs. “- Mark Stiving
So if we simply take the rule that fixed costs never mattered in pricing, then when we're making pricing decisions, we shouldn't be looking at gross margins.
Sometimes we want to look at contribution margin, especially if we're pricing. Uh, take it or leave it type products.
And we can talk about that some other day.
So please don't use gross margin.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Luigi Prestinenzi is Sales IQ Group’s Co-Founder and Head of Growth. He founded this company in 2014 and has been helping companies unlock the full potential of their sales teams since then. Luigi has been in sales his entire career. He hosts the Sales IQ Podcast where he talks with various leaders from around the globe to discuss the art and science of sales and marketing, personal development, and the mindset required to sell more every day.
In this episode, Luigi discusses the importance of creating value in your practice, and why understanding your customers is crucial.
Why you have to check out today’s podcast:
- Find out why you must know what your customer values in order to provide them with what they want;
- Learn why understanding ICPs and KPIs is important for your sales growth;
- Rather than losing a client because you thought you did what was right, find out how to close deals effectively.
“Before even going to a point of price and advocating any solutions, ask yourself a question. Do you know the problem they're trying to solve? Do you know the impact, the problem you’d help them achieve? Do you know the outcome that they're looking to achieve? If you can't answer those three questions, you're pricing too early and it's completely irrelevant.”
– Luigi Prestinenzi
Topics Covered:
01:49 – Luigi’s narrative on how he got into sales
03:09 – Talking about Sales IQ Group and the importance of knowing what your customer values
05:57 – How does Sales IQ Group help people identify their ideal customer profile (ICP)?
07:39 – Why is it important to understand the KPIs in relation to knowing what your customers value?
10:16 – Mark’s dark days in the sales industry and how it reflects two things that really matter the most whenever one sells anything
13:23 – Luigi talks about derived value as he reminds us that we’re not heroes, just byproducts of what we help people achieve
15:18 – The perspective that effectively works in helping clients find the value piece
19:28 – A CPO client who chose the more expensive option in finding an integrator for areeba; Creating value in seeing unrecognized needs
22:33 – Talking about RFPs; People not going for experts and fixing the problems all by themselves
25:44 – What is Luigi’s pricing advice that could have a big impact on people’s business?
Key Takeaways:
“How can you help extract value if you don't understand what the customer's goals and objectives are, and ultimately, what they value? This is where there's a misalignment in the sales profession.” – Luigi Prestinenzi
“Companies that are happy with the customer base – they just don't have enough customers – and often what they do is they've got one message for everyone. They've got the same message for an accountant that they might be selling to and a manufacturing business, when fundamentally, those businesses behave very differently. They've got different needs. Their goals and objectives are different. The challenges and their trends are different. They should segment them and then start to think about the message that resonates for the industry sector that they're dealing with.” – Luigi Prestinenzi
“They're the two things that really matter when we're selling anything. We’re either helping them achieve a better result, or helping them fix a problem that helps them achieve a better result, or it's de-risking something within the business that could have essentially stopped them from achieving a particular result. Anything outside of that, it doesn't become a priority. The biggest competitor a seller or a company selling a product or service he's competing with is not the competitor; it's the status quo.” – Luigi Prestinenzi
“We're not the hero. We're just a byproduct of the outcome we're helping the person achieve. We've got to continue to remember that – we are not the heroes in the conversation.” – Luigi Prestinenzi
“Your pricing conversation is not what they're buying. They're buying the outcome that your pricing conversation allows them to achieve, and that starts at the very first level of interaction that we have with someone.” – Luigi Prestinenzi
People / Resources Mentioned:
- Sales IQ Group: https://www.salesiqglobal.com/
Connect with Luigi Prestinenzi:
- LinkedIn: https://www.linkedin.com/in/luigiprestinenzi/?originalSubdomain=au
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on November 3, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-during-supply-constraints/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Do I really have to tell you how pricing is for?
I hope not, but let's talk about powerful pricing. It is incredibly powerful.
You might've heard that, if you could improve pricing by 1% on average, that has an impact of 10% or 11% profitability on your company.
This is huge.
“Pricing is such an amazing topic. It's complex, quantitative, and psychological. It's huge, powerful, and emotional. Most of all it's fun.”- Mark Stiving
This is powerful, but I have to say what I think I love the most about pricing is nobody else really understands it.
Once we become an expert at pricing, a value, and we're able to communicate that in other departments, in our company, we ended up building our own reputation. We build our own value inside the company because we're able to do things and we know things that other people don't.
Now that doesn't mean that we can be A-holes about it. We have to teach. We have to be collaborative.
We're helping people do their jobs better. But if every department in the company focused on customer perceived value, which is something that you and I understand better than most, then the company would be much, much better off.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Kate Mandrell is a trusted executive with a demonstrated track record of over-delivering promised business results in large-scale commercial transformations on leading-edge marketing & sales topics. An inspiring leader, team builder, and impact-oriented problem solver.
In this episode, Kate discusses how you can embed pricing into the company culture in order to gain the best price, not just for the companies benefit, also for the customers as well.
Why you have to check out today's podcast:
- Learn how to instill a focus on pricing within your organization
- Find out how to differentiate your product and communicate your value
- Discover how to drive a transformative change within your company by partnering with salespeople to sell on value rather than price
"Make sure that you're not too internally focused. I think a lot of people get caught up in what are my costs? How do I manage my costs? But pricing has the ability to do so much more than just make money."
- Kate Mandrell
Topics Covered:
01:17 - How she learned to love pricing and has never looked back since
02:40 - Two things that drive her to want a pricing role
04:18 - What it takes to be successful and grow into a pricing role
07:14 - Echoing Mark's advice on how to make one's pricing role have a great impact on the company
08:03 - Sharing her thoughts on better word choice: 'make value a part of the culture' versus 'make pricing a part of the culture'
09:16 - Communicating the 'attitude of value' inside the company
11:02 - Solving the big picture rather than selling the individual pieces
12:46 - How to go about understanding your product packaging exercise
15:15 - Convincing salespeople of the right approach to 'sell on value'
17:55 - Proving value-selling works even when she was not actually out selling the product
20:51 - Where's the art in pricing
23:48 - Kate's pricing advice that has a great impact on one's business
Key Takeaways:
"The more that you can do to drive the pricing change, show the impact of that change, and then really embed that into the culture of how the company thinks that will help your company and it will certainly help your careers as well." - Kate Mandrell
"We changed our pricing to align to value and therefore made value of what we could deliver the focal point of the conversation versus price, as the focal point of the conversation." - Kate Mandrell
"We did a lot of research upfront. We had conversations with our customers; we understood what our competitors were doing. We really tried to see how we are differentiated, what do we do that is different, better, and special. And that was really the focal point of where we started [changing the company's pricing culture]." - Kate Mandrell
"As you go through a packaging exercise, it's really important to understand who are the different segments that you're targeting, and make sure you don't take a one-size-fits-all approach in all cases." - Kate Mandrell
"In pricing roles, we need to understand how do we tailor our packages and our pricing to deliver the value and the outcome that those unique segments are looking for." - Kate Mandrell
"Every time you introduce something new or drive a change, you have to have sales right there with you, because they're the face of the customer that has to be able to articulate that value." - Kate Mandrell
People/Resources Mentioned:
- McDonald's: https://www.linkedin.com/company/mcdonald%27s-corporation/
- Ecco Restaurant: https://www.ecco-atlanta.com/
Connect with Kate Mandrell:
- LinkedIn: https://www.linkedin.com/in/kate-mandrell/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on October 27, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-saas-on-top-of-aws/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Nobody cares about your features. They only care about what value your features provide them.
That happens to be one of my favorite sayings. ‘Nobody cares about your features.’
And what's pretty fascinating is when you look at companies' webpages, what do they talk about?
They talk about their products. They talk about their features and it's true. Nobody really cares.
“Nobody cares about your features. They only care about what value your features provide them.” - Mark Stiving
Actually experts can look at one of your features or look at your product and say, yeah, I know what that does for me.
I know what value, I'm going to be able to get out of this. But how many people are truly experts when they're shopping for your product?
Most people look at your features and don't know if that's important or not. They don't know if they need it.
They don't know how much value they're going to get from it.
If they buy your product and use that feature a much better approach is to think about value.
What does value mean to your customer? And I can tell you what value actually means. It means they have a problem. Can you identify with the problem they're looking for a result?
What's the result they're hoping to achieve and achieving that result provides value to them.
In the B2B world, that value is measured in dollars in increased profitability.
Our job needs to be, how do we find the words to resonate with our marketplace?
How do we find the ways to communicate that we're providing value to our buyers and not expecting our buyers to look at our feature set and understand what we can do for them.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Joe Woodard's vision is to "transform small businesses through small business advisors." And in the service of that vision, he and his team educate, coach, provide resources and build communities for small business advisors, with the overarching goal of empowering them to play a powerful, high-impact advisory role with their clients.
In this episode, Joe shares how you can create product differentiation that provides maximum pricing leverage where people lean in to the product’s value more than the price.
Why you have to check out today's podcast:
- Find out the key factors that create pricing leverage
- Find out how to make your services or products more valuable
- Learn how to truly get differentiated from among the rest of your competitors
"Well, I'm going to restate something I've already said: Be unlike everybody else. But I'm going to state something I haven't stated before: Make sure you over-manage your brand because you could be unlike everybody else, and nobody knows it."
- Joe Woodard
Topics Covered:
01:50 - Talking about classical Greek
02:40 - Coaching business with a pricing attitude
06:40 - Getting rid of clients you don't want to work with and keeping the ones you want
11:18 - How 'relationship work' gets the highest capacity yield off the least valuable clients
12:34 - Leveraging your unique knowledge or skill to add value to your client
18:39 - Product differentiation: flat fee versus hourly pricing
25:59 - Is it impossible to get accountants to coach their clients on price and what are they capable and very good at doing
28:46 - Joe's pricing advice that can create a significant impact on one's business
Key Takeaways:
"Just because you're valuable and essential, though, doesn't mean that that creates pricing leverage. You must also be differentiated and unique, and ultimately you must be wealth-generating." - Joe Woodard
"To have an empowerment impact on small business, they must be healthy themselves, and health naturally involves healthy pricing." - Joe Woodard
“Their problem is they're underpricing because they're penalizing their own efficiency. So, you're benefiting from the fact that they're penalizing themselves. And as long as that exists in the space, and it's going to exist in the space pervasively that people are flattening it out to increase efficiencies and gross profit margin, you are not going to be able to compete on price. So, the only way to get out of that trap for you, as the client and them as the professional is to not offer flat fee services, but instead to offer subscription services.” - Joe Woodard
People/ Resources Mentioned:
- Ron Baker: https://impactpricing.com/podcast/ep44-ronald-j-baker-trash-the-timesheet-exploring-opportunities-in-subscription-businesses/
- Xero: https://www.xero.com/
- Sage: https://www.sage.com/en-us/
- Intuit: https://www.intuit.com/
- H&R Block: https://www.hrblock.com/
- Liberty Tax: https://www.libertytax.com/
- Tax Slayer: https://www.taxslayer.com/
- Turbo Tax: https://turbotax.intuit.com/
Connect with Joe Woodard:
- Website: https://www.woodard.com/
- LinkedIn: https://www.linkedin.com/in/quickbooksadvisor/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on October 20, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-saas-on-top-of-aws/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
I hate the word commodity. When I see product managers or marketers or salespeople using it, it makes me think they're lazy.
It makes me think they haven't thought through what they're really saying because there really is no such thing as a commodity.
Think about the ultimate commodity product for second and that's gold. I could look online and tell you what the spot price is for gold right now.
And then I could go to a webpage and I could buy a gold medallion and it turns out if I go to more than one gold broker, I'm going to get a different price for that gold coin.
“There is no such thing as a commodity. There is no such thing as a commodity. There is no such thing.” - Mark Stiving
Now, why is that even possible?
This is a commodity.
How could one company be charging me more money than another company would?
Well, there are lots of reasons. Maybe the company that charges more has faster delivery or better credit terms, or they've built a reputation with me, or they have a better looking webpage or they do a better job at marketing and attracting customers.
There are lots of possible reasons. Maybe the gold itself is a commodity, but there's so much going on around any acquisition, any purchase that we shouldn't be thinking about our product as a commodity, because the moment we think we have a commodity, we stop thinking about how can we differentiate it?
How can we create value in the buyer's mind? So repeat after me. There is no such thing as a commodity.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Mark Cox has been fortunate enough to have sold, structured, and negotiated some of the largest single-sale transactions in North America (including a billion-dollar transaction with a top-10 U.S. bank). He founded In the Funnel (ITF) with the mission of dramatically improving the performance and professionalism of business to business sales teams. He accomplished this via (1) Public Sales Workshops for salespeople and sales managers and (2) Sales Enablement Consulting.
During this episode, Mark discusses how it is crucial for salespeople to focus on selling value instead of price. The company would benefit from this move economically, ensuring long-term profitability.
Why you have to check out today's podcast:
- Learn how your capability to communicate as a salesperson contributes to your customer’s desired business outcome
- Uncover top 3 business leader's desired outcomes for each sales transaction to help you lead the sales conversation with value rather than pitch
- Learn the 'common sense revolution' every salesperson needs to achieve top-tier results
"Don't give a price until you understand the impact of the solution on the customer."
- Mark Cox
Topics Covered:
01:19 - The economic impact of selling on value versus on price
02:39 - Talking about the crisis in professional sales
05:44 - Understanding the customers' problems and the desired outcome they want to achieve
09:00 - What should transpire in a value conversation
14:28 - Breaking the wall that often goes up in an encounter with the salesperson
16:41 - Talking value in terms of communication not so much in financial exchange
19:37 - Overcoming fear in outbound demand generation
21:50 - Professional sales compared to performance art and a professional sport
23:38 - How to capture that value proposition in twenty minutes
25:05 - Pricing advice that gives a great impact on one's business
25:49 - Understanding 'solution selling'
Key Takeaways:
"Let's get a little away from trying to persuade and control and trick and do all of these crazy things. Why don't we just actually help buyers buy, help them make great decisions, help them get to a better future? And the more they believe we're sincere and authentic in our desire to do that, the better off we're going to do." - Mark Cox
"The near version of a salesperson to trick somebody into doing something, nobody wants to get persuaded to do anything." - Mark Cox
"People don't buy software; they actually buy what it does for them. The one thing I will kind of call out that I'd love to see a little more up today in professional sales, we're trying to help. The big job though is, we do really need to understand that customer we're reaching out to." - Mark Cox
"This is why we identify this ideal customer profile really, what are they going through? What are they trying to do? And so instead of selling my product when I'm talking to a client or prospect, the first couple of conversations are: just let me understand you and your business and your environment and what you're trying to achieve. "- Mark Cox
"The whole sort of system right now in professional sales is a little bit broken. And that's where we're coming at it with just saying, let's just have this common-sense revolution here. Let's start to sell the way somebody actually wants to buy and start to sell the way you want to buy. And also go at this whole thing so you can be proud of what you do for a living." - Mark Cox
People / Resources Mentioned:
- Philip Squire: https://www.linkedin.com/in/philipsquire/?originalSubdomain=uk
- Levi's: https://www.levistrauss.com/
Connect with Mark Cox:
- LinkedIn: https://www.linkedin.com/in/markandrewcox/
- Email: markcox@inthefunnel.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on October 13, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-aws-can-sell-credits/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Buyers by perceived value, but perceived value is easiest to come about. If we build products that are better than our competitors, and then we make sure we communicate that to our customers so they understand our products are better.
“You create real value by improving your products and services relative to your competition.”- Mark Stiving
So I break this up into real value and perceived value perceived says, yes, we had to have done our marketing, but real value says. Is our product truly better than our competitions?
If you want to win more deals, we should be building products that truly are better than our competitors. So let's be thinking about what it is that our competitors have? What can we do better?
And in particular, what problems does our marketplace have that our competitors are not addressing? If we can do that exceptionally well. And then we're able to communicate that to the marketplace.
We end up winning more deals at higher prices.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jennifer Kerr is a results-driven professional with a proven track record of delivering top and bottom-line profitability. She is a strategic thinker with the ability to create a strategy, vision, and execute to promote business growth. With a focus on capturing customer value, she consistently delivered projects on time and on budget.
In this episode, Jennifer talks about designing your sales compensation plan and structure to drive behavior and incentivize salespeople appropriately.
Why you have to check out today's podcast:
* Discover how to use sales compensation to motivate salespeople to bring in more revenue for your company
- Learn how to use KPIs to motivate your sales team to close deals at higher prices by incorporating them into your compensation structure
-
Find out how salespeople can sell value rather than price
"Value-based pricing has to meet value-based selling in order to be effective."
- Jennifer Kerr
Topics Covered:
01:25 - What led to a pricing role for Jennifer
02:24 - How the pricing tool she created impacted the company
04:34 - A general overview of sales compensation
08:26 - Strategic initiative that is a win-win for both the company and the salesperson
08:50 - How to drive better performance from salespeople
13:27 - The importance of sales compensation base salary to incentivize salespeople
17:23 - What you can do when salespeople don't close any deal after taking the necessary steps
18:38 - Framing an incentive plan side-by-side with value-based selling
20:21 - What is selling value all about
21:40 - Why do salespeople not able to articulate value selling naturally?
25:08 - Leveraging behavioral economics and behavioral insights on salespeople
25:27 - Sharing a tip on how she's using behavioral economics
28:46 - Salespeople wanting a path of least resistance and why they do and how not to let them lead with price
Key Takeaways:
"When you think about more program-based selling, if you're a company or an organization that are on a more mature level, then I think you might want to stop considering widget-based pay, which, in and of itself, could be the lever to pull to get salespeople to sell deals at higher prices and get more margin." - Jennifer Kerr
"If you have four or five steps, and you're not aware, then the design might be off. I go back then to, is the plan design right? I mean, plan design harder." - Jennifer Kerr
"Sales are hard. And that's where I think as pricers, we can certainly help frame up that value base, that value pitch, and flip it into value-based selling. And I think organizations that really focus on that end up winning more than they end up losing." - Jennifer Kerr
"When I say selling value, I think it's how does my product, how does my service impact the P&L of the person I'm selling that to whether it's B2B or how does it impact the household that I'm selling this to. To me, that's value selling because you're not starting with price. And if you start with price, you've already lost in the war of price." - Jennifer Kerr
"Price the product based on its value and the value to the customer. And then go value-base sell it. That's transformational for any organization." - Jennifer Kerr
**Connect with Jennifer Kerr:**
- Email: kerrjennifer63@gmail.com
-
LinkedIn: https://www.linkedin.com/in/jennifer-kerr63/
Connect with Mark Stiving:
-
Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on October 6, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/dont-sell-credits/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Simon Kucher & Partners did a study that found that a huge percentage of people thought that they were in a price war. But when you ask the people who thought they were in a price war, who started it. It was like 80% said the other guy started it.
Remember that last deal that came in and the sales person said, ‘Hey, we really have to do a deep discount. Otherwise, we're going to lose this.’ And so we did a deep discount.
What is your competitor just seeing? They just saw you competing on price.
"Don't compete on price, compete on value." - Mark Stiving
We often think our competitors are competing on price, wherein truth, they're thinking the exact same things we are.
How can we win more deals at higher prices? How can we change the conversation to value instead of price? So my recommendation is to focus much, much more on value than on price.
See, if we can win deals that way your competitors are trying to do the same.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Wendy Johnson started out as an M&A consultant at Accenture, and she got to IBM ten years ago. Now, she is the Vice President at PagerDuty.
In this episode, Wendy talks about the reasons you work with a consultant and not just with someone internally. She emphasize the idea of looking at pricing not as a project but as a process that needs tweaking as you go along and not overhauling.
Why you have to check out today's podcast:
- Discover the reasons how companies benefit from hiring external consultants
- Find out the advantages and disadvantages of hiring external vs. internal consultants.
- Find out how to hire and work with an excellent consultant to avoid wasting money, time, and effort.
“Structure your data and your dashboards in a way to inform all your decisions and such that all of the decisions you make in pricing could be data-driven.” - Wendy Johnson
Topics Covered:
01:39 - Why is it relevant to talk now about a topic on consultants
02:15 - Getting consultants versus hiring them
04:52 - Making the most of a consultant’s engagement with the company
06:04 - Engaging consultants and the value they contribute to the company
07:25 - Driving force behind onboarding a consultant
08:11 - Observation on how consultants work
09:03 - Consultants hiring their own excellent talents
11:00 - Why hire a pricing leader in your company before hiring a consultant
12:34 - What you can do to get other executives involved in getting a consultant
13:12 - One good thing to think about getting data analysts to get involved with consultants
13:58 - Way of knowing for a successful engagement
15:32 - Disagreeable actions consultants do and how to avoid them
17:18 - Thoughts on hiring second consultants and pricing
19:21 - Her pricing advice that could greatly impact one’s business
20:28 - Important KPIs she looks at in her dashboard
Key Takeaways:
“I found that the best way to use consultants and the best way to enter into those relationships is to have a structured engagement with a very finite piece of work or finite task. I think a lot of times the project is too broad. And you end up when that engagement ends, not being left with enough to actually use the work they've done.” - Wendy Johnson
“I think we have to be thoughtful when we engage the consultant not only thinking about the piece of work that they want us to deliver but including what it's going to look like after they leave, like what tools are they leaving for us to use, to reassess.” - Wendy Johnson
“There's been a scenario where we knew we just did not have enough feet on the ground doing a huge transformation. You don't necessarily want to hire a lot of talent, because that capacity need is temporary. So, then you figure out how to fill that temporarily, with consultants, or there's a specific skill set that you know and that's temporary as well.” - Wendy Johnson
“I think if we have an answer to our question at the end of the engagement, and then if we have a way to continue doing that work, we're not stuck with that, that’s success.” - Wendy Johnson
“Pricing shouldn't always be project work. You should build a framework, and there should be some consistent cadence and how you measure performance and you should be tweaking more than overhauling.” - Wendy Johnson
Connect with Wendy Johnson:
- Email: wkjtoday@gmail.com
- LinkedIn: https://www.linkedin.com/in/wendykimjohnson/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on Sept 29, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/usage-based-pricing-is-not-new/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
I don't really want you to just sit around and think about lifetime value. What I want you to do is think about lifetime value and how that influences your business, how that influences your pricing and your product development and your.
If you're in a subscription-type business, this becomes so obvious.
Because we need to win a new customer. We want to keep that customer.
"Think about the lifetime value of a customer. Think about it and then do something about it." - Mark Stiving
We want to grow that customer and we can start to think about if I could win a customer over their entire lifetime, how much revenue.
How much profit do I think I'm going to end up getting from that customer?
And SaaS companies or subscription companies actually do a pretty good job at this, but if you're not a subscription company, you should be thinking the exact same thing.
You put out a lot of energy and money in order to win a new customer. You have a high customer acquisition cost. You obviously want the sale that you got. But can you think about that lifetime value?
Can you get that person to buy more things from you to buy over and over again? And this has everything to do with how well we treat the customer, what our customer service looks like.
Do we have follow-on products? Are we staying in touch with them? There are lots of reasons and things, decisions that we can make once we start focusing on the lifetime value of a customer.
Think about it and then do something about it.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Frederico Zornig is the CEO of Quantiz Pricing Solutions – a pricing consultancy that aims to increase the profitability of their clients through strategies implementing improvements in the Pricing, Revenue Management and Commercial Excellence processes. He earned a PhD in Pricing from the International School of Management, and he was a professor for 11 years.
Frederico initially fell in love with pricing while he was pursuing his MBA at the University of Illinois. It was 15 years ago when he decided to start his own consulting firm.
In this episode, Frederico discusses insights you should take note of in terms of price implementation and inflation. He shares stories that illustrate how the price of your goods can totally make a difference to your business.
Why you have to check out today’s podcast:
- Discover how strategic pricing is critical to defining winners and losers in today's increasingly competitive environment
- Learn about price implementation and how to go about getting people to adopt new strategies
- Learn how you can handle pricing when inflation occurs
“Give price the importance it deserves. I have seen some companies not paying too much attention to the area, and I have seen companies that really believe that price can be a game changer.”
– Frederico Zornig
Topics Covered:
01:34 – How did Frederico get into pricing and what is it that attracts him to keep going?
04:51 – The advantages of being a pricing person who got to lead sales and marketing as well
08:11 – The do’s on making people adopt new strategies and have them implemented in their company – the incentives and the importance of having a strategic commercial policy
14:43 – Companies focusing on revenue and not on profitability; measuring margin dollars instead of margin percentage
19:22 – In having sales compensation plans, how do we convince people to hold or negotiate price?
22:20 – Tips on how to handle pricing in the middle of inflation
25:53 – Having information about your competitors or none at all – not being afraid to raise in relation to volume
27:59 – What is Frederico’s advice that could be helpful to the listeners’ business?
Key Takeaways:
“Pricing is a journey. I believe in that. The company has to go into that journey if they want to be really pricing experts or go after pricing excellence. It's not going to happen in one or two years.” – Frederico Zornig
“The customers have to understand that if they behave the way we have the incentives created, they could benefit of that commercial policy.” – Frederico Zornig
“If you create really strategic commercial policies, you can really change the way the market is built.” – Frederico Zornig
“I always take inflation into consideration. If I'm not coping with inflation, I'm staying behind.” – Frederico Zornig
“Companies that really understand the value and pursue a pricing discipline – a pricing focus – they could benefit enormously in terms of results. Big, big results.”– Frederico Zornig
People / Resources Mentioned:
- Quantiz Pricing Solutions: http://www.quantiz.com.br
Connect with Frederico Zornig:
- Website: http://www.quantiz.com.br
- LinkedIn: https://www.linkedin.com/in/fzornig/
- Email: fzornig@quantiz.com.br
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on Sept 22, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/combining-cost-plus-and-value-based-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
It seems obvious to me that we want to find the buyers that value our products the most and then sell to them.
But once we really start to understand what value means, when we start to understand that value is really about solving buyers' problems, what problems do they have?
What results might they expect and value comes from what's the impact of those results? Once we understand that well, we start looking around and we look at many, many different potential customers or even existing customers. We can start to articulate, which are the problems that are most painful.
“Find the buyers that value your product the most. Sell to them.”
- Mark Stiving
What are the results? People who have those problems are most likely going to experience going to achieve. And then finally, how important, how valuable, how impactful is it when people get that? When we can identify that. Now it's easy for us to say, oh, these are the people. Or at least these are the problems that are most impactful and that have the most value to solve.
That's where we should be spending our time. When we try to spend our time selling products to people who don't value the solution or the results very much, we're really wasting our time putting in tons of effort.
Find the buyers, the value, your product, the most. Sell to them.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Kyle Poyar is the Vice President for Market Strategy at OpenView since 2016. He is responsible for helping OpenView’s portfolio companies accelerate top-line growth through deep insights. He leads segmentation, positioning, channel/partner strategy, new market entry, and packaging/pricing initiatives, partnering closely with portfolio leadership teams. He also covers OpenView’s SaaS metrics and benchmarking research.
Previously, he worked for Simon-Kucher & Partners as a Pricing Consultant for six years. Kyle earned his AB Economics & Environmental Studies at Brown University. He graduated Magna cum Laude with departmental honors in Environmental Studies.
In this episode, Kyle shares how you have to charge based on a pricing metric that has a lifetime value to your business.
Why you have to check out today’s podcast:
- Find out the many nuances of usage-based pricing and see where customers are seeing value and provide more of that
- Understand the nuances between consumers and businesses in terms of how they make purchase decisions so you create a long-term value and availability to expand customers over time
- Find out what forms part of your ARR (Annual Recurring Revenue) and track them to see the health of your business
“Really do the work to figure out what are the one or two usage-based metrics that correspond with the value your customers see. You might find that, hey, these are things where the customers you keep or that spend more tend to consume more of that, as opposed to the ones who churn tend to, you know, consume less of it. And think about how you could maybe incorporate that as like a limit or a fence from one package to the next.”
- Kyle Poyar
Topics Covered:
01:39 - Defining usage-based pricing
02:34 - Usage-based pricing being a customer-friendly model
04:40 - Is buying a hamburger at McDonald’s a usage-based pricing?
05:17 - Pricing metrics as also usage-based pricing
06:47 - The nuances to think about in usage-based companies
08:04 - That rollover minutes that is giving folks that peace of mind
09:10 - Understanding usage-based subscription tiers
10:23 - Kyle’s interpretation of Zuora’s report where it says 25% usage and 75% subscription
11:48 - Why minutes are probably not the best value driver or value metric for phone companies
13:50 - What is part of your annual recurring revenue (ARR)
17:11 - Lifetime value of customer
20:10 - How credits can get in the way of simplifying customers’ buying experience
23:34 - Are credits related to the value the customer gets or to the usage companies are using
25:50 - Credits as used and shown in arcade games
26:48 - Piece of pricing advice that can greatly impact one’s business
Key Takeaways:
“You don't necessarily want to price out usage. If your usage metric is declining rather than increasing, you'd rather make a creative move and say, hey, we're going to give you unlimited usage, but we're going to charge you per gigabyte of data.” - Kyle Poyar
“While you don't want to have unprofitable customers, you really need to simplify the buying experience for them. And trying to align how you charge with how someone sees value, and how your cost structure is set up is really on you. It's not the customer's responsibility.” - Kyle Poyar
“A good way of thinking about credits is building a retainer for a customer and having an agreed upon rate schedule at which they will draw down that retainer.” - Kyle Poyar
People / Resources Mentioned:
- Twilio: https://www.twilio.com/
- Snowflake: https://www.snowflake.com/
- SendGrid: https://sendgrid.com/
- Zuora: https://www.zuora.com/
Connect with Kyle Poyar:
- LinkedIn: https://www.linkedin.com/in/kyle-poyar/
- Twitter: https://twitter.com/poyark?lang=en
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on Sept 16, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/value-propositions-vs-value-selling/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Robert Tinterov is a CEO at Atenga Insights Group. He is a serial entrepreneur, investor, Advisor, and his expertise are also in Sales, Marketing, General Management, Product development, and disrupting digital media.
In this episode, Robert talks about how you can explore your pricing walls and use it to increase demand for your business and scale your growth.
Why you have to check out today's podcast:
- Learn to identify your price walls so you can map prices according to your target audience and maximize profits
- Find out how to ask the right question about a person's willingness to pay
- Learn why pricing potential needs to be raised in the boardroom and how it can be done
“Learn and explore your price walls. Instead of avoiding them, work with them, use them and create higher demand for your products or services.”
- Robert Tinterov
Topics Covered:
01:38 - How he got into pricing
02:45 - What does Atenga focuses on
04:00 - Three levels of potential users of Atenga
05:01 - People purchasing from Atenga versus Atenga selling to them
05:38 - A process they developed to help clients
07:36 - Reasons why price walls exist
08:19 - What usually is the last digit for pricing walls
09:08 - Asking a question on someone’s willingness to pay without being obvious about it
11:08 - How to arrive at the last digit that is nine and can they tell the difference in demand on 350 versus 359
12:17 - Ways Atenga finds customers
13:01 - Robert’s biggest concern
14:34 - Why is pricing not yet in the boardroom’s agenda and what can be done to
Improve on this aspect
19:03 - Pricing advice that can create great impact in one’s business
19:46 - Starting small and doing the easiest but has the most impact to the company
Key Takeaways:
“Our secret sauce (knowing one’s willingness to pay) is like enhancing well-known processes, and then combining that with accessible, firsthand survey data, instead of looking at transactional data.” - Robert Tinterov
“I think the pricing question as such, is not being treated as it should in a lot of businesses, and hence why people don't really take care of this. That's why people are leaving money on the table. They're developing features and functions that people don't want to buy. And that won't create sustainable companies.” - Robert Tinterov
“You can't do everything, but you need to do something, just start doing more about your pricing in your business, and you will see effects and results quicker than you can expect.” - Robert Tinterov
Connect with Robert Tinterov:
- LinkedIn: https://www.linkedin.com/in/roberttinterov/
- Email: robert@atenga.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
To be a pricing leader, you must be a value-based business.
Welcome to the Impact Pricing Memecast, where I take one of our daily memes and provide a little bit more insight behind the word.
In general, a company is either a pricing leader or a pricing follower. A pricing leader is someone who looks at the steady-state of pricing and says, we're going to change our prices first.
“If you want to be a pricing leader, you really need to be focused on value, not on cost plus.” - Mark Stiving
And typically the rest of the market is going to follow that pricing leader. However, if you want to be a pricing leader, you really need to be focused on value, not on cost plus.
Especially not on competitive pricing. Once you, as a company can focus on value, you have the ability to see that the market is willing to pay more than what you are currently charging.
You have the ability to see that your products are highly differentiated from your competitors or that you've got very loyal customers who are going to stay with you. Even if you raise prices above where they are relative to your competition.
When you adopt this concept of truly understanding how customers perceive value, then you have this ability to say, we're going to lead the price change because even if nobody ever follows, we're going to be better off.
We understand the way our buyers are making decisions. But the great news is if you're a pricing leader and you choose to increase prices because you know, you can get away. The odds are really good.
Your competition is going to follow anyway, which simply raises industry profits, which also means your profits.
So if you want to be a pricing leader, you need to be focused on value.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
For a change, Mark doesn't have a guest for today. Instead, he answers questions he would have liked interviewers to ask him. And part of that is, he highlights some important ideas and insights inside his new book with the title of 'Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business.'
Join us in this episode as we get to preview some of the golden nuggets in Mark's newest book.
Why you have to check out today's podcast:
- Find out the important revenue buckets you must manage in subscriptions, so you maximize revenue
- Find out the three essential value levers that companies who are running subscriptions should have to manage and think about to arrive at a good pricing decision
- Discover four ways to grow your customers, so you increase revenue
"One of many things I find fascinating about subscriptions is that many subscription companies have figured out I have to go win customers, and I have to go keep customers. But far too few have figured out, hey, I really should spend time growing customers. And the real reason for that is it's not urgent."
- Mark Stiving
Topics Covered:
01:05 - Why Mark wrote the book 'Win Keep Grow'
02:13 - The three key parts he considered when he wrote the book
03:05 - What he would do if he would rewrite the book and why
04:10 - How traditional businesses differ from subscription type ones
04:42 - Important three value levers that he built into the book
08:56 - Four ways to grow a customer
11:09 - Something fascinating about subscriptions
12:11 - Mark's recommendation to companies
Key Takeaways:
"What I found fascinating about these three value levers is they seemed obvious to me as I'm working on subscriptions. And then you step back and say, Well wait, all three of those value levers are crucial for every business, we just don't stop and think about them that way." - Mark Stiving
"If we can target a really clear market segment, and we can build a product around that market segment, we can create the right packaging for it; we could have the right pricing metrics for it, then that market segment might have a higher willingness to pay. We'll be able to keep them longer, and we'll be able to grow more revenue from them. So, it just makes a ton of sense for us to be focusing a lot on market segments in our subscription world. But we should be doing that in our traditional business as well." - Mark Stiving
"The fact that we're constantly in contact with and helping and delivering value to our current customers gives us the ability to package our products in a way that we can continue to grow our revenue." - Mark Stiving
"If we charge for the right things, and our customers use more of our product because we're charging for the usage of our product, they end up paying us more. But what's really important about that is, as our customers use more of our product, they're getting more value. It's okay that they pay us more. It isn't like we're trying to gouge them; we're simply saying to them, hey, as you get more value, you pay us more money. And that seems really reasonable." - Mark Stiving
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on Sept 8, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/messaging-a-price-increase/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
The best pricing metrics are highly correlated with users value metrics.
A pricing metric is what do we charge for McDonald's charges for hamburgers? That's a simple pricing metric, PayPal charges a percentage of the revenue that we collect.
That's a pricing metric. There are many different types of pricing metrics, especially in the world of SaaS. We have the ability to choose many, many different possible pricing metrics. We could choose the number of clicks we could choose. The number of leads we could choose, the amount of data that somebody downloads or the number of gigabytes.
Someone has access to there's many, many different possible. Pricing metrics. Probably the most common is users. How many users are there or a per seat basis, we get to choose what pricing metric we want to use. And what we want to do is choose a pricing metric that is highly correlated with a value metric and a value metric is how is it that a customer perceives value from the product.
“Choose a pricing metric that is highly correlated with a value metric.”- Mark Stiving
Now, if you think about Netflix a long, long time ago when they first came out, they put Blockbuster out of business. Well, how did they do that? They did that by changing the pricing metric metric. Blockbuster was charging rentals of a movie by the night plus late fees. If you forgot to return it, Blockbuster changed the entire pricing model.
And instead of charging a rental per night, They charged a monthly subscription, which said how many DVDs you were allowed to have at your house at any one point in time. They just changed the pricing metric. And because people love that pricing metrics so much more than they loved paying late fees to blockbuster.
Netflix took off. What you want to do is think really hard about how is it that your customers perceive value. And then see if you can find a pricing metric, what is it that we're going to charge for that is highly correlated with how your customers perceive that. PayPal is probably the most perfect example of this possible as a salesperson, as a selling company, I may X except revenue using PayPal.
So somebody pays me money using PayPal, and I love getting more money. The more money I make, this is just awesome. This makes me happy. Well, PayPal takes a small percentage of that. Well, I don't like giving PayPal a small percentage of the money I make, but I like making money. I hope someday I pay PayPal a million dollars in a year because that meant I made $50 million.
If they're taking 2%, you can see how their pricing metric is highly correlated with how I perceive value. That's what you want to be thinking about your best pricing metrics are highly correlated with users, value metrics.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
With over 20 years of software experience, Ryan Glushkoff provides pricing and product marketing expertise for business-to-business (B2B) software companies. This includes offer packaging, pricing, market research, and pricing strategy and organization.
Prior to founding Fraction8, Ryan cut his teeth in both the pre-sales and post-sales world for both mass-marketing and custom-enterprise software companies, which gives him a unique perspective on how SaaS companies need to price and market themselves for success.
In this episode, Ryan shares what important data set his qualitative and quantitative interviews and surveys uncover to arrive at a pricing decision.
Why you have to check out today’s podcast:
- Find out the three types of competitive research you can use to understand your competitors’ offer structure so you come up with the right pricing decision
- Learn about what different companies are using in their pricing structure
- Find out what is of utmost reason for putting your price online
“Pricing is a team sport. All of those different groups need to be part of the decision. So, it's incumbent upon the product team to steward the rest of the organization through that decision making process.”
- Ryan Glushkoff
Topics Covered:
01:36 - What he does as a B2B technology pricing consultant
03:32 - Doing qualitative interviews and quantitative surveys
04:17 - Aha moments when it comes to clients saying what they claim customers value versus what customers say they value
05:16 - Important data points uncovered with qualitative and quantitative interviews
05:57 - What is competitive research and its different types
07:44 - Times when you consider pricing as part science and part art
08:46 - Going the same pricing metric as the competitor versus charging with better options
09:56 - Sharing his concern about using different pricing metrics
10:38 - Perpetual license of moving to SaaS
11:23 - Touching on usage-based pricing
12:43 - Outcome-based pricing being a version of user-based pricing
13:47 - PayPal and tollbooth pricing
14:41 - Are Lyft and Uber subscription-based companies
15:06 - Price structure of AWS and how it’s different from Uber
18:48 - Regularly buying diet Coke compared to subscription-based
19:37 - What he thinks of putting pricing online
21:42 - When it’s not proper to pricing online
23:28 - His thoughts to a recommendation of putting a price range versus none at all
24:35 - Which way to go -- put price online or not
26:14 - When do companies miss part of their pricing research
26:44 - Where should pricing lives in a company
30:24 - How pricing is screaming for a center of excellence type of approach
31:58 - His best pricing advice that can have a great impact on one’s business
32:27 - Does he actually ask, ‘What are you willing to pay’
33:33 - Mark’s answer to Ryan’s question on why he asks, ‘What are you willing to pay’
Key Takeaways:
“Competitive research is something that is really good to know, but since every company has their own unique value proposition that they bring to market, just copying a competitor, you're probably leaving something on the table by doing that, or you're selling yourself short.” - Ryan Glushkoff
“If you'd ask which side of the fence I would come on, or land on for, whether to put your pricing online or not, I would err on the side of putting it online. The idea of maintaining positive control of the sales conversation is paramount. Especially if you do your homework and you're confident in the research that you've done that informs the value of your solution, the price that people are willing to pay.” - Ryan Glushkoff
“I really think it [Pricing] should live in the product organization because the product owner is really the CEO of the product; the product team has the deepest understanding of the problems that the buyer and the user are facing. They have the deepest understanding of how to go about solving those problems, through the features and capabilities that the solution is offering.” - Ryan Glushkoff
People/Resources Mentioned:
- PayPal: https://www.paypal.com/ph/home
- Lyft: https://www.lyft.com/
- Uber: https://www.uber.com/tw/en/
- AWS: https://aws.amazon.com/
Connect with Ryan Glushkoff:
- LinkedIn: https://www.linkedin.com/in/glushkoff/
- Email: glushkoff@gmail.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on Sept 1, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-cost-of-win-keep-grow/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
There's really only two basic types of value that customers can get. And that's real value and perceived value. Real value is after they've bought the product they're using it.
How does it truly impact their life? How does it really make a difference or solve their problems or yield results?
That's real value in the world of B2B. We could think of real value as economic value. How much more money does it make or save the customer? That's real value. However, before somebody buys the product, they don't really know the real value.
“Perceived value is the only value that matters in price.” -Mark Stiving
In fact, nobody really knows how much value any specific customer is going to be able to get from any specific product. What that means is that before somebody purchases our product, it's all about perceived value.
What does a customer believe they're going to get after the fact? What we need to be thinking of in terms of setting prices or communicating value to our marketplace is making sure our buyers maintain the highest level of perceived value possible from our product.
Now I'm a huge proponent of creating products that have real value and then making sure we communicate that value to our customers. So their perceptions are really close to reality.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jeff Robinson is the CEO at Revolution Pricing LLC and Author of Price for Growth!
In this episode, Jeff shares how pricing should be a strategic effort in driving a company's growth. He talks about how pricing executives should think in terms of long-term margin, having growth precedes profit.
Why you have to check out today's podcast:
- Find out why pricing people should be at the front and center in driving value conversations for strategizing a company's growth
- Learn how to look at the customers' value long-term and generating profit for life rather than looking out for profit for a year and ruining your long-term profit
- Discover the two macro goals of pricing so you think of it as a long-term profit-generating engine
"Think about the growth aspect of your business before you think about the profit aspect of your business. Think about the engine of growth before you think about harvesting profits." - Jeff Robinson
Topics Covered:
01:31 - How he started his pricing career
02:34 - Sharing his story of why he stayed with PROS for almost two decades
04:46 - What happens when salespeople have discount authority
06:20 - Different pricing models
07:36 - Are salespeople the best ones to determine pricing strategy?
10:18 - What he thinks of price differentiation
11:53 - Fairness in pricing - what it really means
15:19 - It's almost never really about pricing; it's about value
17:58 - Can pricing people make or add more value as an internal consultant?
20:40 - What he'd like to see happen at the level of Pricing Director
23:06 - Pricing's two different kinds of macro goals
26:14 - What growth strategy should look like
27:40 - Win, keep, grow - what does it refer to
29:42 - Jeff's pricing advice that can greatly impact one's business
Key Takeaways:
"Price differentiation is not only fine, I think it's desirable. But I think you got to do it in a way that you can maintain a good customer experience across your customer base." - Jeff Robinson
"Customers hate that they're getting priced based on their willingness to agree. If it's not fair, you're going to get a lot of blowbacks. If it is fair, then they'll play along. Look at the airline industry; you have tons of differentiated pricing. But I think most people understand the game; they understand there's some objectivity behind where the pricing is coming from." - Jeff Robinson
"Pricing needs to be at the forefront. I think pricing should be integral to the entire growth strategy of the company. And the reason I say that is because I think they have the most data. And I think they theoretically have the capability to understand all these intersections, if that makes sense." - Jeff Robinson
"Can pricing people make or add more value as an internal consultant? Yeah, definitely. Because as an internal consultant, they can operate at a level where they can add a lot of value, and they don't have to go into every minute detail. They can go into the level of detail that's needed." - Jeff Robinson
"The whole idea is if you think about growth precedes profits, then from a pricing perspective, pricing leadership should be thinking about growth first, and then thinking about profits when the time's right." - Jeff Robinson
People/Resources Mentioned:
- Price For Growth by Jeff Robinson: https://www.amazon.com/Price-Growth-Revolutionary-Step-Step-ebook/dp/B08Z5YTGTZ
Connect with Jeff Robinson:
- LinkedIn: https://www.linkedin.com/in/jeffrobinson4/
- Email: jeffrobinsontx@gmail.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on August 15, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/failed-to-keep/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Pricing really encompasses almost every department inside your company, because when you think about it, pricing is how do we capture that?
And so now it's all about value, what's value to the customer. In fact, what's perceived value to the customer and we can work our way backwards and say salespeople on a one-on-one basis, talking to customers are trying to help each individual customer understand how much value our product might be able to deliver.
“Product teams create value. Marketing communicates value. Sales helps buyers understand their specific value. Pricing captures value. Everyone is coordinated.”- Mark Stiving
Marketing, on the other hand, looks at a whole bunch of people and says, what's the type of value that most people are looking for. How can I communicate that value?
How can I communicate that we're solving problems for those people?
And then we take a step back to the product management or product development piece, and they better be building products that provide value to our customers.
The only way they can do that is if they actually understand what value means.
So in my view, all roads lead back to pricing because pricing understands value, at least the concept of value better than most other departments.
However, every other department probably understands the value of any specific product, better than price.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Mike Wilkinson is called 'The Value Selling Expert' and he helps Sales Directors/VPs and sales teams understand customer value and get paid what they're worth.
In this episode, Mike shares how you need to get to the generic issues of the business first, document and understand what the company faces so you know how and where to add value, and ultimately defend your pricing.
Why you have to check out today's podcast:
- Learn how to solve the 'value mystery', so both customer and seller discover how much value there is going to be
- Find out why salespeople should need to have business acumen, so you understand how your customer's business works and know where to look for value
- Discover the right approach to the ROI calculator, so you know where you add value
"Don't apologize for your pricing. Be proud of it and look for the value. Don't discount first. Value first. Then think about if you need to discount."
- Mike Wilkinson
Topics Covered:
01:59 - Sharing his thoughts on an ROI calculator gap being pointed out
03:33 - What for Mike is 'Value Discovery Conversation"
05:01 - Value is a mystery
06:06 - Why salespeople have to understand what business acumen is
07:02 - How to make value conversations better
09:24 - Big gap between expectation and reality
11:12 - Addressing a 'which one' decision scenario
12:27 - What's the biggest differentiator when there are no other differentiators
15:07 - Talking about ROI of the differentiation
16:19 - What truly is differentiation
17:48 - Talking about the concept of 'generic issues'
20:18 - Salespeople operating on a 'rat-up-a-drain-pipe' selling
22:38 - How to let customers perceive something to be a real priority
24:16 - A great way to build up the perception of pain
25:46 - Mike’s pricing advice that can greatly impact one’s business
Key Takeaways:
"I think the value discovery conversation is so much more than just having a chat to establish customer needs. I really think it is about taking the customer on a journey of value discovery, helping them to understand the things that they actually do need, the possibilities, the challenges that they have, what impact those are having on their business." - Mike Wilkinson
"If value is a mystery, we need to understand what customers value. We need to solve the value mystery." - Mike Wilkinson
"I have to have that business acumen of understanding how the hell does the customer's business work? Where does their income come from? Where do their costs come from? Because if I don't understand either of those, I'm just shooting in the wind." - Mike Wilkinson
"What a lot of salespeople forget is that one of the biggest differentiators is themselves. Just the sheer feeling of comfort people get when dealing with somebody that they know, trust, like, respect -- that is still massively valuable. But you have to be able to deliver." - Mike Wilkinson
"The thing about differentiation, as I always say, being different isn't differentiation, differentiation is being different in ways that deliver real value to the customer." - Mike Wilkinson
"I think thinking about value and thinking about the value that you believe that you can deliver to your customers is hugely important. But you need to take a step back from that in the initial stages of the conversation you're having with your client." - Mike Wilkinson
Connect with Mike Wilkinson:
- LinkedIn: https://www.linkedin.com/in/mikewilkinson-thevalueexpert/
- Email: mw@axiavalue.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
Business in its simplest form is getting paid for providing value to the customer.
It may be true that they're going to get the value. It may not be true that they're going to get the value, but they believe they're going to get the value.
And what we need to do is make sure we understand what our customers or our buyers are looking for.
What does value mean?
“Business, in its simplest form, is getting paid for providing value to the customer.” - Mark Stiving
Typically, we could think of this as our buyers have a problem they need to solve, they have a result they're trying to achieve and aspiration thereafter.
The only reason that people buy a product from us or from anybody. If they perceive value.
If we can help our customers understand what our value is and the more they understand our value. The more likely they are to buy. And in fact, the more likely they are to pay us a higher price.
Because when we think about business, business is really about us giving value to our customers, and in exchange, they give us money.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
This is an Impact Pricing Blog published on April 18, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-when-costs-go-up/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Ayon Bhattacharyya is an experienced business leader with significant success in revenue growth through commercial problem-solving. He is implementing innovative pricing solutions, fact-based analysis, and market research, drawing upon his stakeholder management and influencing skills to gain the support of other senior leaders.
In this episode, Ayon shares the need to understand your customers, so you can segment without merging them and you gauge their willingness to pay and set the best pricing.
Why you have to check out today's podcast:
- Learn about customer segmentation and how to go about defining it to arrive at optimal pricing for a particular segment
- Find out how customer segmentation helps articulate your value proposition to solve different problems
- Learn how to categorize your buyers best so you lead with value and not pricing
"Do your research and know your customers. Identify your customer segments and, where feasible, perform price experiments to validate willingness to pay. And don't be afraid to experiment with subsets of your customer base and try to innovate your approach."
- Ayon Bhattacharyya
Topics Covered:
01:37 - What sparked his interest in pricing
03:27 - Price fencing in the airline industry
04:50 - Why do airlines have the best price offering for direct customers
05:56 - Reason why airline fare price increases as the plane nears take-off
06:30 - Differentiating between a business traveler and a leisure traveler
07:02 - How could they possibly created fare rules around business and leisure travelers
08:16 - Ayon sharing his thoughts on customer segmentation
09:09 - What are those customer attributes
11:47 - Defining customer segments
13:49 - How to find out who's going to travel for a particular attribute to be met
14:42 - Would it be better to actually differentiate the proposition by having a premium and a cheaper price
15:53 - All about customers' choice of greater or cheaper value
17:58 - Preventing segments from merging
20:25 - Differentiating pricing in UK, Australia, and New Zealand
22:56 - Categorizing buyers
24:21 - People's surprising attitude on getting rich many years ago
26:20 - Reacting to Mark's funny New Zealand experience
26:56 - Ayon's pricing advice that would greatly impact one's business
27:54 - Why be careful in lifting anchor when experimenting with your market
Key Takeaways:
"It's all about choice at the end of the day. The customer gets to choose a greater value or less value, and they pay the price based on value." - Ayon Bhattacharyya
"The best way to counter this is differentiating your value proposition. If you're solving different problems, then you're able to customize that value proposition to the segment, and that helps to mitigate that risk of segments merging." - Ayon Bhattacharyya
"One of the guests on your podcast has referred to the importance of not leading with price, and I absolutely 100% stand by that. Always lead with value." - Ayon Bhattacharyya
"There is a fear often around raising prices. But if you're able to support that with additional value, then usually your customers are quite receptive to that." - Ayon Bhattacharyya
Resources/People Mentioned:
- Westpac
- Negotiating with Backbone: Eight Sales Strategies to Defend Your Price by Reed Holden
Connect with Ayon Bhattacharyya:
- LinkedIn: https://www.linkedin.com/in/ayon-bhattacharyya-a84ba615/#
- Website: https://bizgrowthspurt.com/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on April 11, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/price-moves-during-market-shocks/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
First, a zero-sum game essentially means the size of the pie is fixed. If we have a pie there and you get to cut it that, and I get to choose which half I'm going to take, then that's a zero-sum game because the more I take, the less you get, or the more you take the less I get.
In price negotiations, assuming we don't change the product or the offer. And it's just a debate on how much is a customer going to pay in order to buy our product. That's a zero-sum game.
The more they pay, the more we get and the less money they get to keep and vice versa. However, that's not the way business works.
“Business is not a zero-sum game. Focus on increasing value to the customer.” – Mark Stiving
We shouldn't be thinking of our business as a zero-sum game. Instead, if we're clearly listening to our customers in our marketplace, we can create features and products and capabilities and nuances of our, of our products so that the buyers get more and more value. And the more value they get, the more they're likely willing to pay.
And their willingness to pay probably exceeds our cost of creating that X additional value. In other words, we're creating value both for the customer and for us, hence the business isn't and shouldn't be thought of as a zero-sum game.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Monica Sinha is a Price benchmarking Lead and Senior Manager at Capgemini. She has over 15 years of experience in the Finance sector which includes experience with the business finance team of Tech Mahindra, the commercial management office at Accenture, brokerage department at Karvy Computershare Pvt. Ltd., and corporate finance department at Tata Finance Ltd.
In this episode, Monica shares how benchmarking increases your confidence in winning deals. And she also talks about when benchmarking truly becomes helpful -- that's when teams work together to truly connect with the customer to attain the best possible final price for a quote.
Why you have to check out today's podcast:
- Find out how benchmarking helps validate the final price
- Learn how benchmarking helps increase your chance of winning the deal
- Find out how you go through benchmarking the competitors' price and the nuances that are involved in it
"When you are in the pricing line, then I think you need to have a very holistic view. We just cannot go with taking the cost and add the margin, and derive the price out of it. You need to have the entire team aligned into one."
- Monica Sinha
Topics Covered:
01:11 - How she landed into pricing
02:32 - Pricing compared to a recipe
03:46 - What benchmarking suggests
05:19 - Benchmarking as a validation check
08:18 - The way benchmarking is done and the nuances involved in it
13:03 - The challenges that come with benchmarking
16:08 - Doing post-mortem analysis to what led to a difference in price after benchmarking
17:21 - How to find out what price the competitor is charging
20:07 - The one thing that helps you win a deal
20:41 - How do we benchmark value-based pricing
23:14 - Monica's pricing advice that can significantly impact one's business
Key Takeaways:
"It is so much of confidence, where benchmarking is there, where benchmarking is built to validate. And in fact, I would say that the chance of winning a deal increases by many notches." - Monica Sinha
"Benchmark gives you a sense that yes, you are close to that price, or you're very far off, then probably there is some mistake that you're doing in estimation or something somewhere. So, let's just recheck how you're doing it. So benchmarking is a very good instrument to validate the final price that you're going to submit." - Monica Sinha
"The one major thing that is very important is that if we have to really give a winnable price if we want to really understand what the value that the customer is looking for, what should be the correct price for it, then all of these team members, they need to align and work together. And they need to understand that they should have some connection along with the customer so that whatever the final price that they are coming up with is the price that should be ultimately quoted." - Monica Sinha
Connect with Monica Sinha:
- LinkedIn: https://www.linkedin.com/in/monica-sinha-46904041/
- Email: monicasinha1002@gmail.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 28, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/disney-understands-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
When we think about how our buyers decide. Oftentimes they're deciding, am I going to buy your product? Or am I going to buy a competitor's product? What they do is they look at the price of your product, the price of your competitor's product.
And for a moment, let's assume the price of your product is higher. So they ask themselves, is it worth it? Should I pay more for your product? Well, that depends on what they're going to get when they buy your product instead of the competitor's product. Now we're talking about differentiation. What's different about your product versus your competitors product.
"Real value comes from building products that are really better than our competitors." - Mark Stiving
It turns out when buyers are making this decision, they're using their perception of the differences. So it's really about perceived differentiation, but if you want to truly get. Good differentiation. My advice is always build real differentiation build products that are better than your competitors, and then make sure our customers and our buyers know that our products are better than our competitors so that they're willing to pay a higher price.
Real value comes from building products that are really better than our competitors.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Stormie Andrews is the president of Yokel Local. He is a licensed practitioner of Neuro-Linguistic Programming (NLP), an award-winning author, Forbes contributor, HubSpot contributor, recognized buyer persona expert, and HubSpot Certified Trainer. He has also been recognized as a Member of the Year from the American Marketing Association, named as a Top 50 Tech Visionary, and his book, "The World’s Best Buyer Persona® System," became an Amazon Hot New Releases Best Seller.
In this episode, Stormie talks about how the World’s Best Buyer Persona System helps users set them apart from competitors in terms of market positioning where pricing doesn’t have to be one driver.
Why you have to check out today's podcast:
- Find out how to create the next best thing in creating your best buyer persona in the absence of the gold standard
- Learn how to create a value proposition where pricing isn’t the number one driver
- Find out the concept of TINB (There Is No B) in the World’s Best Buyer Persona System
“It's not about you. It's not about your goods and services. It's about your prospects, your ideal customers, their pain points, their issues. The more time, energy, and effort you put into that, the more in alignment you're going to be as it pertains to your pricing.”
- Stormie Andrews
Topics Covered:
01:53 - How he started getting into personas
03:20 - Differentiating sales and marketing
07:02 - Creating multiple personas for each buyer type and making recommendations
07:52 - The next best thing to do when you don’t meet the gold standard to help you create the best buyer persona
09:55 - Using Maslow’s hierarchy of needs as a basis for creating personas
14:01 - How does a buyer persona influences pricing
17:34 - Building personas for different decision makers
21:28 - What could be the CFO’s TINB for a certain product
22:23 - Putting a TINB for a buyer persona
25:50 - The belief systems that are addressed in the World's Best Buyer Persona
27:15 - Stormie’s pricing advice that can have a great impact on one’s business
Key Takeaways:
“As we go through that exercise, we can spend an entire day just on positioning factors, because we have to have unique positioning factors that are designed to resonate with someone, not everyone. And if we can align those positioning factors, put them in alignment with the belief systems, the motivations of their ideal prospects, they're going to be in better shape.” - Stormie Andrews
“When we get into that positioning in the marketplace, we can find that market gap that sets the users of the ‘world's best buyer persona’ that sets them apart from their competitors, they market on that unique positioning that they have within the market. And that becomes their value proposition that can become their TINB (There Is No B), where pricing isn't the number one driver.” - Stormie Andrews
“What if we build a persona where we build resources for the initial influencer, and then we create and build a packet that they can download and give to the CFO that addresses their problems, their issues, their concerns, their motivations. That makes the world or at least that it's designed to speed up the sales process and make for a much smoother sales process.” - Stormie Andrews
Connect with Stormie Andrews:
- Website: https://www.flowcode.com/page/stormieandrews
- LinkedIn: https://www.linkedin.com/in/stormieandrews/
- Email: stormie@yokellocalmarketing.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 28, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/i-hate-loss-aversion/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
It's true, we expect we need to know how it is that our buyers are making decisions. In particular, how is it that they use price in that decision process?
Certainly, there are irrational behavioral economics-type issues, and we want to understand those. But what we truly need to understand as a company, the thing we don't understand is value. What are the decisions our buyers are making?
"Understanding your customers decisions is fundamental to value based pricing." - Mark Stiving
In terms of is it worth it? Am I getting enough value for the money that I'm paying? And in particular, the two decisions that seem to drive this the most? First decision is “Will I will I buy something in the product category?” And there we're asking ourselves, “Is the price low enough that when the customer solves the problem, they're happy paying that price to solve the overall problem?”
The second decision they make is which one, which product will I buy? Which competitive alternative will I buy? In this case, we need to make sure that our price relative to the quality and capabilities of our products is attractive to our buyers, relative to our competitors, quality capabilities and price.
We need to understand what are those decisions our buyers are making? How do they use price and making those decisions so that we can do a much better job at pricing our product and by the week creating and communicating about our product as well.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Liz Wainger is a communications strategist, author, serial connector - I help businesses and nonprofits clarify their messaging and purpose.
In this episode, Liz shares one tool she uses that helps her create a message that cuts through the noise, solely focused on your target audience and what truly resonates with them.
Why you have to check out today's podcast:
- Learn how to create a messaging architecture that is customized but has an overarching message across all audiences
- Find out a process of figuring out customer value statement
- Discover what the most smart marketers mistakes are and learn how to create something that truly resonates with your audience
“Understand the emotional driver of the purchase, what they really want in the end, it's like Ted Levitt, who was a professor of marketing, says, "When people buy a drill, they don't want the drill. They want the hole."
- Liz Wainger
Topics Covered:
01:54 - Relating a story about his brother's death and the importance of the concept of value
04:48 - People pays for whatever they value
05:28 - What value does she offer
08:21 - What you need to look into for people to buy your product
10:30 - Figuring out customer value
14:14 - Using a triangle to create your positioning platform
17:34 - What is so special about creating 'three' pillar messages
20:17 - Leading the discussion with what is truly valuable to the customer
21:49 - Focusing on what you are targeting and leaving something out
22:18 - How to communicate something that genuinely resonate with your audience
24:25 - Turning your presentation into a sales pitch
26:11 - Asking probing and not threatening questions
27:24 - Liz's pricing advice that greatly impacts one's business
Key Takeaways:
"The way I do messaging is we use a triangle. Depending on where you customize and what is most interesting to your audience, you lead with different triangle points. But the underlying message about what makes this product tick, or why you want to use this should be true, according to all your audiences." - Liz Wainger
"We live in a world where we're over-communicating, we are getting so much information. So, the ability to cut through and really get to the core and simplify is so important. Because people have very short attention spans." - Liz Wainger
"At some point, there's what I call the porosity of information. So, you want to be consistent because it's the consistency that builds equity -- attention equity, brand equity, value equity over time." - Liz Wainger
"A big part of, and I think everybody should think about this, that no matter what your product is, or services, that you should be coming at it from the perspective of I want to help these people get better at whatever it is that they want to do. Not that I want to get the work." - Liz Wainger
Resource:
- Prism of Value by Liz Wainger: https://waingergroup.com/in-the-news/book/
Connect with Liz Wainger:
- Website: https://waingergroup.com
- LinkedIn: https://www.linkedin.com/in/lizwainger
- Email: liz@waingergroup.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 9, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/when-should-you-lower-your-price/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
We know that we have to subscription companies have to win customers, keep customers, grow customers.
This is really about keeping customers and we should have a customer success department that is watching usage. Watching are people really getting value from our product.
Those who are using our product a lot are getting a lot of value and hence are very unlikely to churn.
"Subscription businesses need you to use and like their product to keep you buying it. Customer success creates value." - Mark Stiving
Those that stop using decrease using aren't using the right features, the people who aren't getting as much value from our product, they're much more likely to churn.
Our customer success departments should be watching who's using what and how much, and then helping those who aren't using the product enough to see the value.
To be able to use the product more because the more they use it, the more value they get, the less likely they are to get.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jared Smith is a Business Consultant at Vendavo, a world-class commercial excellence software firm that enjoys seeing clients evolve into leaders in their industry. He is a Ph.D. candidate at Oklahoma State University researching how companies execute strategies, pricing, and sales dynamics.
In this episode, Jared talks about salespeople's insufficiency where business acumen is concerned. He is encouraging companies to put some training where salespeople can do value statements, challenger selling, and using whatever pricing methodologies they can have.
Why you have to check out today's podcast:
- Find out how to motivate salespeople to understand the target price and capture a product's value
- Learn how salespeople can deviate from the target price and still earn from it
- Find out how salespeople can defend pricing from a product's economic value and not just on discounting
"Have the courage to experiment, have the courage to look at different things and approach pricing in a different way. The statement that we're going to raise prices and our customers are going to leave us, and we live in that fear all the time, that's not a really rational way of looking at things."
- Jared Smith
Topics Covered:
01:18 - Relating his first exposure to pricing
02:55 - Pricing for B2C versus B2B
04:43 - Taking a look at the whole value statements between B2C and B2B
06:45 - The disconnect between sales and pricing
08:26 - Shortfall in business acumen of most salespeople
10:06 - How to make value conversation happen
12:56 - Talking about sales discount and escalation processes
15:03 - He believes giving salespeople autonomy
16:50 - Setting compensation structures in a way that motivates salespeople not to discount but sell on value
18:24 - The compensation style that motivates most salespeople
20:35 - The challenge of getting salespeople sell above the target price
21:34 - Higher commission rate when hitting the price ceiling
22:20 - Understanding the value that customers get from the product
23:17 - Jared’s best pricing advice that greatly impacts a business
Key Takeaways:
"The key thing that I see is, when you start to talk about price, it gets into that whole thing of the sales operations, ‘Do I go there and do I lead with that ceiling price and discount down to the target?’" - Jared Smith
“What about if we set our compensation structures in such a way that motivates them not to discount, to always sell that value, but also maybe even motivates them to go higher than that as well?” - Jared Smith
“In the psychology of salespeople, that's what really drives a lot of the behavior and how you put your compensation system to move with those three numbers right there - the list price, ceiling, and target price.” - Jared Smith
"Have the courage to develop the capability of pricing in your company. Invest in good people, invest in good technologies, things that can support this as a discipline, much like you've been doing in the supply chain and all these other ones for years. So have the courage to change, have the courage to have the critical conversations." - Jared Smith
Resources/People Mentioned:
- Prime Source Building Products: https://www.primesourcebp.com/
- Frito Lay: https://www.fritolay.com/
Connect with Jared Smith:
- Email: jared@jaredpaulsmith.com
- LinkedIn: https://www.linkedin.com/in/jaredpaulsmith/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 2, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/can-your-pricing-be-your-advantage/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
When we asked salespeople why we lost the deal, almost always, we got the answer, it was the price.
Maybe they tell us it was a feature that we didn't have, but the price was a big deal.
And the price is always a big deal. It turns out that yes, you can probably lower your price low enough that you could convince any buyer to buy your product.
But that's really not the point of sales. What we want to be able to do is make sure that.
Our buyers understand the value of our product, what it is that we're offering. And if our buyers understand that we offer so much more value than the price we're asking for, they're willing to buy.
So the problem may be that we're not doing a good enough job at communicating value. Or the problem could be the product just doesn't have enough value.
Have we built products that people really value? And can we communicate that to individual buyers?
So they're willing to part with their hard-earned money in order to gain those benefits.
"There are two reasons for every loss sale. One, price was too high to the buyer. Two didn't expect to get enough benefit. Don't just blame price." - Mark Stiving
So the problem may be that we're not doing a good enough job at communicating value. Or the problem could be the product just doesn't have enough value.
Have we built products that people really value? And can we communicate that to individual buyers?
So they're willing to part with their hard-earned money in order to gain those benefits.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Michael Farber has 16+ Years in Enterprise Software and Technology Sales with Xactly Corporation, Concur Technologies, ERP solutions such as Baan, Deltek, ABAS-USA. He has expertise in solution selling and delivering exceptional revenue results and customer satisfaction. He has an excellent ability to qualify, professionally present, differentiate, negotiate, close, and connect the dots at the "C" level within organizations. He is the founder of The ROI Shop.
In this episode, Michael shares how the ROI calculator provides value conversation letting the buyer think of a financial number rather than just an admin tool.
Why you have to check out today's podcast:
- Find out how ROI calculators provide value conversation between the buyer and seller
- Learn how ROI calculators allow a step-by-step process of building credibility and confidence to you, thereby holding firm on your pricing
- Discover how you can provide a collaborative approach between buyer and seller so they find, understand, and see the value and not ask for a discount
"Quantifying that value upfront. I mean, if you go in and they agree to the value you can bring them in the main areas where they're looking, it is going to be impossible for them to come back and say, ‘Oh, yeah, we need a 40% reduction,’ especially if the return is ten times the investment."
- Michael Farber
Topics Covered:
01:41 - How the ROI calculator changed the way he sold
04:20 - His thoughts on replacing the word ROI calculator with the word business case
05:51 - What's the use of the ROI calculator?
07:15 - Using an ROI calculator template based on the vertical you're working with
07:51 - What the process looks like for a salesperson letting the buyer fill out the ROI calculator
10:55 - A collaborative approach to using ROI calculator
12:30 - What it means to have the step-by-step process of using ROI calculator
17:16 - 'Will I' type questions can be built inside ROI calculator
18:17 - Building a security value calculator
20:05 - Michael's best pricing advice that greatly impacts a business
Key Takeaways:
"Rationally, companies buy for two reasons: you're going to make some money, you're saving money, that's really it at the end of the day. So, it's even more important to do it. When a company sits down, or the rep sits down and does a good job of walking their prospect through it, it separates them from the other sellers, the other sellers aren't doing it." - Michael Farber
"You think about our interactive value calculator. It's like its own website portal. So, we stir emotion with visuals, and videos and stories." - Michael Farber
"Understanding the 'Will I' type questions, we could build those into the calculator. As I said, what we build is more than just how many employees do you have? What is their average salary? How many hours does it take, type thing? We build interactive discovery questions in it. So based on a certain answer or a drop-down, we can drive another discovery question. And then based on that discovery question, we can start to quantify a different area." - Michael Farber
"I will tell you; I have not discounted our price in our last seven deals, not one penny, and we more than doubled our price since a year ago. So, it really does; they got to see the value. And then it's hard for them to ask for a discount." - Michael Farber
Resources/People Mentioned:
- Concur Technologies: https://www.concur.com/
- Bacardi: https://www.bacardi.com/
Connect with Michael Farber:
- Website: https://www.theroishop.com/
- LinkedIn: https://www.linkedin.com/in/michael-farber-9946281/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on July 21, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/acquisition-pricing-for-retention/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Yes, we might have a really complicated pricing scheme pricing process that we have internal, although there are lots of reasons why we may not want that because it's complex for us to manage.
But that's better than making a complex for our buyers. In the world of what we are showing to our buyers, we need pricing to look simple, we need it easy for buyers to make decisions, because confused buyers don't buy.
And if we can't simplify the way we present pricing to our buyers, we're hurting our marketplace. My favorite company for how they do this is LinkedIn. LinkedIn is defined in four different market segments.
Those are recruiters, jobseeker sales people and professionals, which means everybody else. Inside each one of those four segments, they have good, better, best offerings.
"Pricing can be complex internally, but must look simple to the buyer. " - Mark Stiving
What we want to be able to do is emulate this because if you think about being a buyer from LinkedIn, or you want to buy one of Linkedin's products, you say, ‘Hey, I'm a salesperson.’
And now you can see the choices of what it is that you might want. And they make it simple for us to see, understand and choose.
Even though behind the scenes, they've got at least 12 different packages plus a whole bunch of different options and they're managing a lot of different things.
Their buyers see very little of that, and the choices the buyers make are much much simpler.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Mark Boundy is an expert in value building, selling, and marketing.
In this episode, Mark explains how to present value to your customers in a measurable, concrete, and real way where value is quantified resulting in more profitable deals and paying customers.
Why you have to check out today's podcast:
- Learn how to translate your customers' feature-and-benefit differentiation into a customer-differentiated customer outcome.
- Understand the buyer's purchasing journey so they know the value they are getting, and you become their only choice
- Discover the 13 things you need to know about your customer, so you win every time
"Right now, customers are really struggling with some different issues. And slowing down and understanding your customers' business and how their business is changing gives you an opportunity to really set yourself apart as that trusted advisor, that trusted partner who can help them co-create a solution that maybe your competitors could, but your crappy competitor salespeople don't."
- Mark Boundy
Topics Covered:
02:47 - What is a sales funnel and the misconceptions about it
03:57 - The most shortsighted thinking when it comes to sales funnels
07:03 - Thoughts on some terms used that are seller-centric
08:46 - What the process looks like when humans decide at something
10:18 - What happens when customers are only self-informed
12:53 - The likelihood when there is no differentiating factor among sellers other than the price
14:11 - How to make customers ‘will I’ compelling that you are the only choice for the ‘which one’ decision
15:23 - Creating demand for the outcomes that come from the differentiating feature
17:10 - Importance of dollarizing outcomes
18:01 - What’s with personal outcomes
19:39 - Value versus price
26:43 - Thirteen things you need to know about your customers
Key Takeaways:
“If we tell salespeople just to find out what the customers have self-informed and what their envision is, what usually happens is the result of that self-informing is under informing and misinforming and some combination. And their vision for the future is probably pretty underwhelming. And if you actually build exactly what they envisioned, it would never have ROI in the first place.” - Mark Boundy
“We train people using methodologies and great questions and understand and uncover the pain. To uncover, get a perfect vision of the customer's imperfect vision. When we ask them to uncover the pain, the customer can only answer the pain that is the result of their self-informed vision, they can only give you what they know. They need an expert to say have you ever thought about this or other customers like you have actually found this, too.” - Mark Boundy
“You have to bring them [customers] from a 'will I' to a 'what will I'. As soon as that 'what will I' becomes compelling, then they're back to a 'will I' and it happens to be a 'will I' that you're the only available 'which one'?” - Mark Boundy
“I work with my clients to understand their differentiation. And I work with them really hard to translate their feature-and-benefit differentiation into a customer differentiated customer outcomes.” - Mark Boundy
“Value only exists in your customers’ mind, that scale, that counterbalance only exists in your customers’ mind. Your value that you articulate, it's a value proposition, you're proposing something that you hope comes into existence between your customers and yours. So, credibility is what opens their ear.” - Mark Boundy
“Value has to outweigh the price. Your differentiated value has to outweigh the price premium over the next best choice.” - Mark Boundy
Resource/People Mentioned:
- Radical Value: How to Take Your Company to the Next Level Through Radical Customer Centricity by Mark Boundy: https://www.amazon.com/Radical-Value-Company-Customer-Centricity-ebook/dp/B08527K4ZG
- The Nature of Human Intelligence by Robert J. Sternberg: https://www.amazon.com/Nature-Human-Intelligence-Robert-Sternberg/dp/1316629643
- Miller Heiman Group website: https://www.millerheimangroup.com/
Connect with Mark Boundy:
- Website: https://boundyconsulting.com/
- LinkedIn: https://www.linkedin.com/in/markboundy/
- Email: mark@boundyconsulting.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on July 14, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here:
https://impactpricing.com/blog/stop-sales-discount-authority/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Tech support is reactive and prevents unhappy customers. Customer success is proactive and generates customer delight. Customer success creates additional value.
These are solving problems that our current customers have and typically customers are going to call us. They say, ‘Hey, I'm not getting delivery or, Hey, I don't know how to use this. We're being reactive and supporting our customers. And yet in this recurring revenue world, we really need to be proactive.
We need to make sure our buyers are using our product.
They're getting value from our product, because if we want them to pay us month after month after month, they'd better be receiving value. That's where the customer success department comes in.
"Subscription businesses need you to use and like their product for you to keep buying it. " - Mark Stiving
Customer success needs to be watching. Who's using the product. How are they using the product? How much are they using the product?
Are they truly getting value? The way we would expect them to? And as customer success helps our individual customers get more and more value from our product.
It makes it less likely that our customers are going to churn out. And B makes it more likely that our customers will end up buying more from us in the future, either through usage or upgrades or, or even cross selling or buying something different from us in the end customer success, that proactive activity is creating value to our marketplace.
And it's something that we'll end up capturing in higher prices or more sales.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Sebastian Wrobel is an energetic and passionate professional leader, helping companies to achieve value and pricing excellence. In order to achieve lasting integration, he is pushing digital transformation. In addition, he has extensive experience working closely with the C-suite and senior stakeholders to formulate and implement major profit and growth optimization plans. In addition, he leverages a collaborative and data-driven leadership approach to build high performing teams.
In this episode, Sebastian highlights pricing’s role in sales negotiations.
Why you have to check out today's podcast:
- Learn why Pricing people are expert negotiators, a good business partner and advisor to sales in negotiations
- Find out how to negotiate sales more effectively with value levers
- Understanding procurement's role in negotiating the best deal
“Pricing people can do, they can deliver regularly on trainings, at least to create awareness and ability to understand the commercial levers that salespeople could leverage.”
- Sebastian Wrobel
Topics Covered:
01:13 - Relating an incident that got him started in Pricing
01:55 - Getting addicted to Pricing
03:10 - The extent to which Pricing people should be involved in sales negotiations
04:30 - What is in Pricing people that makes them a good part in the negotiation
07:27 - The point you need a professional negotiator to help sales in the negotiation
08:43 - How from the nature of their roles pricing people are professional negotiators
11:22 - Misconceptions about negotiations and the importance of preparing for it beforehand
15:51 - What do pricing people need to have to be effective in negotiation
18:09 - Value drivers that have commercial impact you can use to negotiate with big customers
21:33 - The ‘negotiation jacket’ and the role play involved in negotiation by procurement people
24:55 - Using all levers in negotiation to get the best outcome
27:00 - Sebastian’s best pricing advice that could greatly impact one’s business
Key Takeaways:
“The underlying assumption is that in the negotiation, you discuss value. And in fact, you need to know the value for the client much earlier before you go into a negotiation. So, this is the first maybe misconception about negotiation that you negotiate the value at the event of the negotiation. That happens much earlier.” - Sebastian Wrobel
“To be effective in pricing, you need to have empathy with sales, with your sales team.” - Sebastian Wrobel
“And I think pricing can help both in the preparation in delivering the data and developing the commercial strategies negotiation, but also being a neutral negotiation partner that is less emotional, and can help on the commercial and objective parts in the negotiation.” - Sebastian Wrobel
“There are many kinds of tools in negotiations. Once you learn them, it's by far not as complicated as sometimes perceived. But you need to understand the toolbox, and you need to be able to use it. I'm personally convinced that pricing people has the skill. And once they get comfortable with the toolbox, they can be really good business partners and advisors to sales in negotiation.” - Sebastian Wrobel
Connect with Sebastian Wrobel:
- Email: wrobel@pricingworks.io
- LinkedIn: https://www.linkedin.com/in/sebastian-w/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 30, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/willingness-to-pay-vs-price-sensitivity/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Values should drive most business decisions
Yes, it's true. Value should be.
Almost everything that goes on inside your business. I learned this because I'm a pricing guy as a pricing guy. What we think about is, “Hey, I've got this product. What's the value of that to my buyer? To my customer? How much would they be willing to pay me?”
But once you start thinking that way you realize, “Well, did we actually create a product that had value to our customers? Could we change the product? Could we create products that have even more value?” And then we start thinking.
Well, how well does marketing do at communicating the value?
"Value is that thing that really should be driving everything in our business. " - Mark Stiving
Once I understand what buyers are truly valuing and how much they're willing to pay, do we put those things in our marketing messages? Are we finding the right types of buyers?
And then you start thinking, will the salespeople truly understand the way buyers value the product, and can they help individual customers understand that value even better?
In the end, value is that thing that really should be driving everything in our business.
I like to think of it as we need to create, communicate and capture more value. And that's really what makes a business successful.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Alex Hoffman is an articulate commercial leader with extensive experience in addressing profitability challenges through Commercial Analysis, Pricing / Business Strategy, and Portfolio Management.
In this episode, Alex Hoffman underscores how pricing tools, insights that pricing experts develop, and the key decision-makers play a crucial role in value-based pricing. And most importantly, effectiveness in communicating those important insights has to be taken into consideration.
Why you have to check out today's podcast:
- Find out the six features that are critical to setting pricing that could maximize the capture of value from customers
- Learn how to capture the value that's created through product innovation and understand the critical nature of the message
- Understand the crucial role of marketing in pricing
"Using market research, using your past campaign performance, figure out the economic value you bring to the customer. The first thing you need to do is figure out the value, and more importantly, does the customer perceive that value?"
- Alex Hoffman
Topics Covered:
01:45 - Alex's weird and circuitous way of getting into pricing
03:05 - What got him interested in pricing that he stayed with it
04:24 - Sharing successes at implementing value-based pricing in Telstra
07:34 - How Telstra uses conjoint in pricing
09:18 - Using conjoint for churn
10:48 - Honing your marketing message for a specific segment
12:56 - Marketing as a critical role in pricing
14:32 - The hard part of focusing on both cost and value when pricing
16:06 - Looking at the subscription model from the ground up
18:02 - The idea of cross-subsidization
19:37 - Interesting concepts around cloud-based gaming that could help boost the margin
20:20 - Talking about the disparity between the sophistication of the pricing tools, pricing teams' insights, and those who make the critical decision
23:00 - The law of agency kicking in
23:39 - The hard part of having the 'burden of proof' displaced
25:21 - How things can work if you have a support network
26:12 - What destroys margin across the entire Telco industry
28:20 - Alex's best pricing advice that can greatly impact one's business
Key Takeaways:
"And as you get involved in pricing, you really understand the critical nature of the message. So, we're about capturing the value that's created through product innovation and the like. But if the messaging and the marketing doesn't adhere to that, you get nowhere." - Alex Hoffman
"You need to ensure that you've got strong input and buy-in into the marketing, as well as the pricing, the pricing strategy, the financial analysis. Marketing is a critical part of the role." - Alex Hoffman
"With 5G coming on board now, cloud-based gaming is dynamically growing, and customers who are game addicts, by the very definition do not necessarily behave in a rational way, at particular points in time when they need their surging speed; they are prepared to pay what I would call almost surge-like pricing. And so, you can develop all sorts of interesting concepts there that could help boost the margin." - Alex Hoffman
Resources mentioned:
- Telstra: https://www.telstra.com.au/
Connect with Alex Hoffman:
- Email: ahoffman644@gmail.com
- LinkedIn: https://www.linkedin.com/in/alex-hoffman
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 16, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/perceived-versus-real-value/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Using price to solve product-market fit is like changing gravity to lose weight.
Product Market Fit is one of those things that we hear often, especially as we're going to launch a brand new product.
We want to make sure that we understand what the market really needs, what problems we plan to solve.
And have we built a product that truly solves those that resonates with the marketplace.
“Using price to solve product-market fit is like changing gravity to lose weight. “- Mark Stiving
And this is something that we have to try to figure out as a business. And yet, sometimes companies say, ‘Well if I just lower the price, I'll be able to sell more.’ And that's absolutely a true statement. Probably you'll sell more if you lower the price. But that doesn't say that you've achieved product-market fit. I compare this a lot to losing weight.
I know that I need to eat less, I know that I need to exercise more. But you know, if only I could change how strong gravity was I'd weigh a lot less. And it would take me much less work.
When we're after the product-market fit. Don't be thinking so hard about the price. Yes, the price is important. Yes, we're going to use the value we're delivering to our buyers in order to set that price.
But for right now, in the beginning, focus all of your efforts on what are the problems we're solving? What does the market really need? And have we built a product to go solve those.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Robert Ribciuc is a Managing Partner at EBITDA Catalyst and a Pricing expert for Consumer & Software brands, driving 2-5+% profit & valuation gains in less than 12 months.
In this episode, Robert shares how as pricing experts, we need to capture as much of the value and use value-based pricing to its full advantage while understanding a client's business goal regarding social concern in taking care of its vulnerable market segment.
Why you have to check out today's podcast:
- Learn how to make your pricing function and capabilities tuned in for price increase even at a time of inflation
- Find out about a white paper on how you can turn inflation into a competitive advantage
- Learn how to make your role as pricing experts be economically and morally satisfying
"Don't accept inaction for too long as your standard course of action."
- Robert Ribciuc
Topics Covered:
02:01 - How Robert's journey began in pricing
05:27 - Talking about what EBITDA Catalyst do: customer insights and designing offers
07:03 - The broader definition of customer insights
08:49 - What he has to say about the price increase and inflation
11:40 - When do cost start to matter when pricing
17:53 - The deal-envy factor that happens
19:02 - What you earn for superior procurement function and competitive advantage
20:33 - A question on when should we start putting a second lens on value-based pricing
23:13 - Showing what mission-driven pricing is about
27:42 - What it means to enlarge the definition of one's role as pricer
29:49 - Robert's best pricing advice that could significantly impact one's business
Key Takeaways:
"Seeing the human impact of doing pricing better, I'm not going to say right, but doing pricing better can impact the teams and the lives of the people who produce the value in the first place." - Robert Ribciuc
"I think when we look at inflation; if you do nothing and you think just the cost impact, of course, bad things are going to happen to your margins when costs are up and everything else stays the same." - Robert Ribciuc
"Being able to articulate, especially in B2B conversations, hey, part of why the price is higher is like, look, it's fair, our costs are higher. That does play a role in the sales interactions that moves the needle towards achieving that price increase a little easier." - Robert Ribciuc
"The conversation we just had reflects this role we have as pricers to help our clients or our employers capture as much of the value as possible. And I think there's also a part of what we should be doing, which is to think about the sort of social role and ultimate role of pricing as a vector in social movements." - Robert Ribciuc
"We should enlarge the definition of our role as pricers because our first role is to understand our client." - Robert Ribciuc
"If the client or the employer, part of their mission is not to capture as much as they could from the value pie that's being created, but to consistently leave more on the table than they could, I think that makes our work both economically satisfying and morally satisfying when we can be part of that." - Robert Ribciuc
Resources Mentioned:
- Inflation & White Paper Increase - EBITDA Catalyst: https://www.ebitdacatalyst.com/inflation-price-increases-whitepaper/
- Chick-fil-A: https://www.chick-fil-a.com/
Connect with Robert Ribciuc:
- Email: robert@ebitdacatalyst.com
- LinkedIn: https://www.linkedin.com/in/ribciuc/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on June 16, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/4-steps-to-being-a-great-director-of-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Win, keep, and grow are three different revenue buckets that any subscription company has to manage.
You have to put resources into winning customers, you have to put resources into keeping customers, you have to put resources into growing customers.
“Win, keep, and grow, each needs its own focus.” - Mark Stiving
What's fascinating is that most of the time when you invest when you do marketing tactics, you're impacting one of those three. And even if it goes across more than one, you're probably doing it for a specific reason.
My recommendation, go through all of the tasks that you have, and identify which of these three revenue buckets are you focused on, you focused on winning or keeping or growing customers.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Saima Khan has 10+ years of experience creating pricing strategy and portfolios, revenue management, and business planning. She has 7+ years of experience in international markets as a leader and teammate. She is quick to adapt to change and able to work with different teams in difficult environments.
In this episode, Saima shares how you shouldn't price low your products or services at the start as it is hard to increase prices later on, and it might be lower than the market's perception. And she suggests pilot models you can use other than underpricing.
Why you have to check out today's podcast:
- Find out what these two essential factors to pitch when you work for startup companies as a pricing consultant
- Learn about the tools used to test the pricing effectiveness of products in a startup company
- Find out how to do pricing for newly launched products for a startup company
"Always start your business with your customer. Where do they see the value? Focus on that when it comes to products, services, and pricing, and then look internally and see how you can be more relevant to your customers, how you can provide them the best value and be agile about it."
- Saima Khan
Topics Covered:
01:45 - What got Saima into Pricing
02:30 - Why she stayed in Pricing
03:10 - The many skills involved in Pricing
03:52 - What's the difference working for a big company versus consulting
05:16 - What companies in terms of size does she work with
05:52 - Why are there few Pricing consultants focusing on startups, and what is her way of working with startups
06:54 - What it looks like pricing for a startup
09:42 - Pitching both business model and pricing strategy to companies
12:36 - How she helps startup companies with smart pricing decisions based on value
14:08 - The biggest challenge startups face in terms of pricing
16:17 - Why you shouldn't go for a low price when launching new products
19:22 - What creates lack of trust in the market
20:02 - Using tools to help clients understand their product's value
22:49 - Her pricing advice that can significantly impact one's business
Key Takeaways:
"I think the most interesting part of startup pricing for me is, and I say this again, and again, is the link to the business model. Because for a startup, it's very important to see how the startup is going to charge money, for what, and from who. And it applies to mostly all of the startups but a lot more to software products." - Saima Khan
"When I work with startups, I don't start with pricing, I start with the business model, and identifying which customer group is actually deriving the most benefit from your existing product and services, and how you can work or adjust your products and services portfolio to create more value, or that group of customers who you can monetize the most." - Saima Khan
"You cannot monetize a product which has not been tried in the market. But the best way to do it is through a freemium model or a pilot model instead of underpricing. Because taking the price up is very hard because you establish the value of that product already." - Saima Khan
"I guess we need to educate startups a little bit more on the element of pricing the value they bring because it's natural that whenever you bring something very new to the market, you're a little bit under-confident. And it's natural to underprice your products and services." - Saima Khan
People/Resources mentioned:
- Bumble app: https://bumble.com/
Connect with Saima Khan:
- Email: khan@gmail.com
- LinkedIn: https://www.linkedin.com/in/saima-khan
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on May 26, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/the-buyers-journey-when-to-reveal-the-price/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
When you first launch a subscription product, you have to focus on winning customers right away, of course. And you'll really quickly realize that keeping customers becomes just as important as winning customers. All companies, all subscription companies have to focus on winning and keeping customers.
There's also growing customers, growing customers becomes really important as you mature as a company. In the beginning, it's all about winning customers, keeping customers building up that recurring revenue base.
“When and keep early and often grow only later.” - Mark Stiving
Once you've built a decent installed base, though, now the question becomes, how do we get those customers to pay us more money?
If you just think about when you're going to spend time and energy focusing on different activities early on, only focus on when and keep completely ignore the grow piece.
But once you built that installed base, it's time to start shifting to grow the problem most companies have, they never do that. So don't be like most companies. Instead, start thinking about how do you grow the amount of revenue you get from your installed base.
If you learn to do that, your company will grow much faster.
We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.
Now go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
John Peacock is a Senior Vice President at ASRC Federal.
In this episode, John shares how building up great relationships ultimately paves the way to your success rate in a government setting as in any other. It’s also a matter of triangulating these three essentials of pricing, price to win, and competitive intelligence, and all other data points to reach your pricing point.
Why you have to check out today’s podcast:
- Learn how to do competitive intelligence and price to win
- Find out how to show value in a government setting and have a good win rate
- Learn how to shape opportunity so that government RFPs comes out more in your favor
“You’ve got to have really good relationships across all the different functional and organizational teams within your company. At the end of the day, my ability to get to the right price and help the company get to the right price is all driven off of the teams of people that you work with to get there.”
– John Peacock
Topics Covered:
01:16 – How one thing led to another and finally into pricing
02:23 – What got him to stick with pricing all these years
04:06 – Working through the pricing ranks
04:57 – What is ASRC, what does it do, is it government-focused primarily
07:09 – Pricing for value in a government setting
09:01 – A multi-step process in government bidding
10:38 – Talking about sole source contract award
12:03 – What’s a good win rate
16:58 – Taking a look at win rates early and late in the process
19:06 – Increasing win rate at the time the RFP comes out
21:46 – Factoring in competitive intelligence in the price to win
23:56 – The key to do competitive intelligence and price to win
28:21 – Margin requirements for bidding
30:31 – John’s best pricing advice to help create a great impact on one’s business
Key Takeaways:
“A big piece of government pricing is compliance; it’s responding specifically to what they ask for.” – John Peacock
“It’s much harder to win something where you’re not ahead of the curve in government pricing. It’s not as if there’s a commercial price list that you just go grab a number off of; we’re not buying a Dell laptop that you can just get anyone can go and get the same price for. It’s much more specific than that. And so, you’ve got to be ahead of the curve if you want to have a good win rate.” – John Peacock
“Just like everything in life, everything comes down to relationships, and whether it’s your BD people, your program people, the people that are truly successful are the ones that make good relationships; they bridge that gap. And that allows you to have those conversations, and explain why there’s value add. If you have the greatest product in the world, but no one will talk to you. It’s not going to ever go anywhere.” – John Peacock
“The level of information and expertise comes into play. Putting the numbers together, honestly, isn’t the hard part. It’s pulling all the pieces together, so you know what the numbers should be?” – John Peacock
“The key to how we do competitive intelligence and price to win is, I see federal really falls within the expertise of the team that does this, and how they’re able to present the data.” – John Peacock
“I always tell my team, how you present information, how it looks even, is critically important. You might have the best answer in the world. And if you do it in cram, on a PC, your kids drawing paper, you’re not going to win the award; it’s got to look good, smell good, taste good. It’s got to be 100%.” – John Peacock
People/Resources Mentioned:
- Tech Systems: https://www.techsystemsinc.com/
- Dell: http://www1.ap.dell.com
Connect with John Peacock:
- Email: jpeacock@asrcfederal.com
- LinkedIn: https://www.linkedin.com/in/john-d-peacock
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on May 19, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-to-become-a-pricing-expert/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
The reason we even have this meme is because too often, companies think, ‘Oh, I need to go subscription.’
They want to transition from a traditional business model to a subscription business model.
And they often think of it as a payment plan. ‘Oh, I used to charge this. Now I'm going to charge this divided by 36 each month. And that gives me a three year payback.’
And even if the math works out, it's not the right way to think about it.
“Subscribers buy benefits, not products, they don't take ownership.”
- Mark Stiving
What you want to think about is, what's the stream of benefits my customer gets when they buy my product, because what you really want is for them to get that stream of benefits month after month after month.
They're happy paying you month after month after month, because they're getting those benefits. If you can think through clearly what are the benefits that you deliver, then you might be able to restructure your product so that you can deliver those benefits more visibly more easily more readily.
And then you can think through what are the detriments of the way you sell your product today? And is there a way we could overcome some of those because we go for a subscription. We want easy detriment is instead of giving you all that money upfront, I get to pay you a month at a time.
And by the way, if I don't like your product, if you're not delivering value to me, I get to churn out and I get to unsubscribe, so it gives buyers or customers the ability to try our products without committing huge amounts of money.
So in the end, think about the benefits your buyers are getting. It isn't about selling our product because buyers are buying our benefits.
We hope you enjoyed this memecast. If you see any of our memes that you'd like to move to the top of our memecast list, please let me know.
If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Arjun Patnaik is Head of Pricing & Commercial Finance at Pine Labs. He used to work at GE as an Audit Manager.
In this episode, Arjun talks about how the role of pricing is richer in subscription businesses than any traditional business as it allows you to pull many pricing levers. He shares how triangulating the three important factors of knowing your value, communicating it, and figuring out people's willingness to pay drives the whole point of pricing.
Why you have to check out today's podcast:
- Learn to differentiate and understand how pricing works in a traditional versus subscription business
- Learn about the whole customer lifecycle and lifetime value in pricing subscription
- Find out the three pillars of subscription pricing where everything flows from there
“Don't undervalue yourself. Don't leave money on the table. Do the hard work. Don't just go for a cost-plus or competition-based pricing. Spend the time, talk to your customers, understand their value equation and willingness to pay. It's going to pay off. So, spend time, money, and effort on pricing, and it will pay you back.”
- Arjun Patnaik
Topics Covered:
01:46 - Arjun's accidental entry into the world of pricing
02:46 - What pricing for him is
03:56 - What was GE's pricing approach, as he used to work there
06:13 - How was it like for him moving from cost-plus pricing to value-based pricing
08:51 - Why is the role of pricing much richer in subscription business than any regular sales business
10:18 - What he thinks of subscription pricing
14:11 - The business he was involved in at GE
14:56 - Talking about businesses transitioning from traditional ones to subscription
15:58 - His thoughts over Finance people being the wrong people to run pricing
17:59 - The need to marry data and solid customer research
Key Takeaways:
"When I think about pricing, I need to think about the whole customer lifecycle, especially in my business, right? So, I need to think about, at what price is my sales team acquiring customers efficiently? So, at what price can I maximize productivity and lower the cost of acquisition? - Arjun Patnaik
"Beyond just the core product that I'm selling, which I'm getting the recurring revenue for, how do I sell more services to this customer because it's much easier, you get a much larger bang for the buck, monetizing compared to acquiring." - Arjun Patnaik
"I think that's why we need to marry data, which we have an abundance of, with solid customer research. Because if someone says the customer wants this versus that and they're not able to prove that, it just comes down to, like, a bit of faith, experience, and gut feel. But then I just believe in customer research, and there are so many tools in pricing to figure out what the price range is." - Arjun Patnaik
Resource Mentioned:
- GE: https://en.wikipedia.org/wiki/General_Electric
Connect with Arjun Patnaik:
- LinkedIn: https://www.linkedin.com/in/arjun-patnaik-63abb56/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an Impact Pricing Blog published on May 12, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-question-about-pricing-models/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Customer Success is that department where we want to onboard
We want to make sure they're using their product, getting as much value out of our product as possible.
Because companies that use our product a lot are much less likely to churn out.
We think of customer success as reducing churn as a way to keep our customers then absolutely it is and it absolutely should be.
“Customer Success creates real value that we can capture now in retention revenue, and someday in expansion revenue.*”*- Mark Stiving
But what really happens that's super valuable is the more we can teach our customers to use our product, the more value they get out of our product, the more likely they are to upgrade.
The more likely they are to stay if we raise their prices, the more they love us and we consider other products or the more they use our product, and they end up paying us more because of our pricing metric.
Customer Success then not only helps us with retention, but it's probably even more value in expansion.
We hope you enjoyed this memecast. If you see any of our memes that you'd like to move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Michael Hurwich is one of the foremost and sought after Pricing, Revenue & Strategy Management Consultants known around the world. Michael is a highly effective and energetic business leader with over 20 years of experience in Strategy, Revenue Optimization, Mergers & Acquisitions, New Product Development and reengineering business processes. Michael works closely with leadership from the C-Level to line management to develop and execute clearly defined pricing strategies.
In this episode, Michael takes pizza as an example to explain pricing as there are commonalities shared by businesses when it comes to pricing strategies and tactics that resonate with the whole concept of pricing pizza.
Why you have to check out today's podcast:
- Learn how value and demand factors, not cost, help you increase price
- Find out how you win customers and gain their loyalty
- Learn how to harmonize your pricing and the value that you deliver
“Definitely focus on demand, supply and demand issues. When something seems very busy, there's a tremendous opportunity to elevate your price, so long as you're delivering value in the marketplace.”
- Michael Hurwich
Topics Covered:
02:03 - Why talk about pizza
03:29 - A variety of pizza suiting everyone’s preference on every location
04:44 - Why are organizations leaving money on the table when pricing pizza
08:07 - Pricing being all about value, the supply and demand
11:36 - How do we avoid price transparency
15:20 - What is price transparency and the goal of moving consumers to purchase more than they otherwise would have
19:17 - Pricing and elasticity of demand
22:03 - Talking about loss leader products
24:03 - How to earn your customer’s loyalty
26:56 - His best pricing that can greatly impact one’s business
Key Takeaways:
“The key is to really figure out how to move away and make the price a little less transparent and focus on the value and the demand of those products. It's all about supply and demand. And the stock market reflects that very well, as does Bitcoin.” - Michael Hurwich
“It's really about moving customers to where you want them to end up at the end of the day. And it's incumbent upon vendors to drive purchasing behavior, not the other way around.” - Michael Hurwich
“The goal is really to focus less on price and price points, focus more on value and increasing that value perception and differentiation.” - Michael Hurwich
“In the pricing world, the important component of understanding price is also to evaluate and determine the elasticity of demand.” - Michael Hurwich
“And one of the things that people, most consumers actually don't know, they typically don't know the individual price of a product. What they do know is how much they're willing to spend when they go out.” - Michael Hurwich
“Better to sell the first slice at full ticket price, the second slice at half price, you're more than covering your costs, and also covering some incremental fixed overhead, at the same time, an extra sale. - Michael Hurwich
Resources Mentioned:
- McDonalds: https://en.wikipedia.org/wiki/McDonald%27s
- Burger King: https://www.bk.com/
- Wendy’s: https://www.wendys.com/
- Schneider: https://www.se.com/us/en/
- Pepsi: https://www.pepsi.com/en-us/
- Coca Cola: https://www.coca-colacompany.com/
- Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business by Mark Stiving: https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784
Connect with Michael Hurwich:
- LinkedIn: https://www.linkedin.com/in/michael-n-hurwich-6292109/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an article published on April 21, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/a-question-about-pricing-models/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
If we can continue to win customers, we're growing a business a lot, like a traditional business would where they constantly have to win customers. And the good news is, if we keep them, then we start the beginning of each year out with a whole bunch of customers we already have.
“How to grow a subscription business? Step one, win another customer. Step two, keep that customer. Step three, grow that customer. Step three is crucial but often ignored*.”*- Mark Stiving
But the best companies figure out ways to grow individual customers. What this means is, can we find ways data customers who paid us $1 last year to pay us more than $1 this year. And there are several techniques that you can use, you can certainly raise their prices, if you have a subscription-type business, you can upsell them into another package, you can cross-sell them into something that's similar.
Or if we've chosen a good pricing metric, we can help them use more of our product, which means they're good at getting more value, and they're paying us more money. There are lots of different ways that we can grow a customer. The key is way too many companies completely ignore this.
And we ignore this because we don't really have to deal with it. If you're not winning new customers, you can tell that's a problem. And if you're turning customers out, you can tell that's a problem. But there's nobody watching, are you growing your customers and claiming it's a problem?
If you're not? Well, I'll claim it's a problem. If you do not figure out how to do it, you'll grow much much faster.
We hope you enjoyed this memecast. If you see any of our memes that you'd like to move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jose Mirabal is an advisor and expert in negotiation and pricing strategies. He has more than 350 projects carried out in 27 industries. His clients include multinational companies, governments, regional organizations, foundations, and non-profit companies.
He is also the CEO of MIRABAL Pricing Services, a consulting firm specializing in price strategies and negotiation. He is the author of the Value-Based Pricing Framework ©. He has given more than 160 talks, workshops, and seminars in 13 countries.
He graduated from Cornell University with postgraduate studies in California Coast, Stanford, and Adolfo Ibañez.
In this episode, Jose underscores the common thing all CEOs share -- being pricing leaders. To him, an even greater need to have a strong grasp of pricing and knowing and recognizing value. That's why he also shares the reason why he started Pricing Institute and what it does.
Why you have to check out today's podcast:
- Find out a pricing standpoint on value-based pricing as opposed to cost-plus pricing, so you find solutions to business problems from a pricing perspective founded on value
- Discover what value configuration is, so you focus on what the client gets and provide options for them, so you get the right pricing for everyone
- Find out the different dimensions you need to work around to make up value, so you back it up with the right pricing strategy
"Read about need-based segmentation. Just read it. How could you do need-based segmentation in your business? That's number one. The second thing, if you're going to do competitive analysis, do competitive analysis from a value standpoint."
- Jose Mirabal
Topics Covered:
01:43 - How a talk with some CEOs started his Pricing career
04:09 - What he has found out about pricing through the years of his consulting career
05:37 - Everybody's focusing on the costs but forgetting the value part
07:48 - Why did he create Pricing Institute
11:17 - Tactics he is teaching
14:48 - Why to him the whole concept of value is sort of missing everywhere
16:38 - What he thinks on why most companies don't know how to identify value
22:49 - Not only do they not know value, they also don't recognize it
26:41 - How to do competitive analysis from a value standpoint
25:53 - Jose's piece of pricing advice that can significantly impact your business
Key Takeaways:
"If I want to improve the pricing of one of my customers, the first thing I need to do is that relationship of value between my customers' products, and the clients' needs in the market and how those two things talk when I contextualize them and put them against other competitors." - Jose Mirabal
"When I think of pricing, I look at first value configuration because Warren Buffett said, price is what you pay, but value is what you get. So, let's focus first on what the client is getting, or how we can improve the number of options and expand the width and the range of options that we can offer clients, just like a restaurant." - Jose Mirabal
"I want my clients to come in. And regardless of what they want, always have the right option for them. And I think when you have that, that's the same thing as having the right price for everybody." - Jose Mirabal
"Most companies, most professionals, specifically, most investors, if not all of them, most CEOs do not challenge their pricing. What happens is that they end up perpetuating all bad pricing habits." - Jose Mirabal
"Nobody really realizes that the only way your value or the value you offer will actually work is by how well you capture that value backed by your pricing strategy." - Jose Mirabal
Resources/People Mentioned:
- The 1% Windfall: How Successful Companies Use Price to Profit and Grow by Rafi Mohammed: https://www.amazon.com/1-Windfall-Successful-Companies-Profit/dp/0061684325
- Rafi Mohammed: https://www.pricingforprofit.com/rafi-mohammed/
- Vistage: https://www.vistage.com/
- Amazon: https://en.wikipedia.org/wiki/Amazon_(company)
- Uber: https://www.uber.com/tw/en/
- Netflix: https://www.netflix.com
- Airbnb: https://www.airbnb.com/
Connect with Jose Mirabal:
- Website: https://pricing.institute/
- LinkedIn: https://www.linkedin.com/in/jrmirabal/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an article published on March 31, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/pricing-is-not-driven-by-supply-and-demand/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Everybody has a pricing metric. But so few companies actually think about it. Think about when we bought cars, we would buy a car. And that's a pricing metric. The pricing metric is what is it that you charge for as a company.
So McDonald's charges for hamburgers, so a hamburger is a pricing metric. In the old days of software, I remember going to Fry's Electronics and pulling a shrink-wrapped box off the shelf with Microsoft Office in it.
“All companies use pricing metrics. Some companies consciously make the decision.”
- Mark Stiving
And so the pricing metric was that box, they were selling me the box and the contents inside it. Nowadays, though, especially in the world of SaaS, and cloud-based SaaS, we have tons and tons of different things that we could possibly choose for, choose to charge for, for example, maybe we charged by the user, which is what Salesforce certainly popularized in the subscription business.
We could sell by the gigabyte of storage, we could sell by the number of clicks, we could sell by the number of downloads, we could sell by the number of emails, there are so many different things that we could sell our products based on.
And what I find fascinating is when we moved to cloud-based SaaS, many of these companies had to think through this, they had to say, Okay, what makes sense for us, although way too many of them still just default to users when it's probably not the best choice.
But now, go back to a traditional company. Now that we understand that we get to choose what we want to charge for, is there a way that we could choose something that more closely ties to the value our customers receive?
And one of my favorite examples of that was a comedy theater in Spain, where they had video cameras on the seat in front of you, and they charged based on the number of laughs.
That's pretty awesome.
The real point is, spend a few minutes, think about your pricing metric back maybe spend a few hours, but your pricing metric in a traditional business, you have the ability, the potential to change industries.
Just look at what Netflix did to Blockbuster.
We hope you enjoyed this memecast. If you see any of our memes that you'd like to move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Larry Walsh is the leading go-to-market advisor to technology executives, channel leaders, and solution providers around the world. Widely known for his ability to cut through problems and challenges facing vendors, distributors, and solution providers, Walsh is sought for his advice, counsel, insights, and consultation on channel strategies and technology market trends.
In this episode, Larry shares how to determine channel profitability and the economic equation that goes with it. He talks about how brand presence is one of the determining factors to persuade channels to take the risk of selling your product. He also differentiates how you can make money or compensate channel partners for selling a product directly versus selling a subscription for a product. He also shares what his company, Channelnomics, does.
Why you have to check out today's podcast:
- Learn how to structure your process in terms of relationships you want to create with your channel partners in order to meet the types of need you have
- Understand the pricing strategy that goes with having channel partners, so you get them to convince to sell your product instead of the competitors'
- Find out the sales motion [sales model] you want to operate on so you determine how to set the compensation and who sets the price
"Once you fall out of that zone where there's none of the endemic margin in your pricing to support yourself plus your partners, then stop selling to your partners."
- Larry Walsh
Topics Covered:
01:38 - How he transitioned from being the newspaper editor to a channel guy
03:22 - What he thinks of channels
05:17 - A channel being a sales motion
06:08 - Talking about parallel channels and channel strategy
07:20 - Pricing strategy for channel partners
11:15 - What he thinks as a mistake when dealing with channel partners
11:57 - Determining channel profitability and the economic equation associated with it
14:57 - How brand presence affects channel partners' decision to sell a product
15:57 - When can you go shallower on the margin
16:30 - First mover advantage in terms of consideration
17:30 - Selling a SaaS through a channel versus selling a physical product through a channel
21:53 - How to compensate a channel partner for a subscription type of sales
22:56 - How do you make money on a sell-through-sell on a more consumption-based model
24:19 - Differentiating the subscription and consumption-based models
25:03 - Talking about lock-in terms and renewal rates
25:44 - Larry's pricing advice that has a great impact on your business
26:57 - What is Channelnomics and what does it do
Key Takeaways:
"What we look at when somebody comes to us looking for a channel strategy, the first thing we want to know is, who's the customer? What does the customer need from you, or what does the customer need to be successful with your product? And that will then define the chain or the channel that it goes through." - Larry Walsh
"To me, a channel is a sales motion. And that can include direct relationships; it can include automated relationships. So, it's not the ‘what’ that's doing, it's the ‘how’ it's being done." - Larry Walsh
"Often, a mistake that's made when dealing with channel strategies is thinking about this as what do I have to pay versus what do I have to do to enable? Or what do I have to do to engage with a partner to be a good go-to-market, have a good go-to-market relationship?" - Larry Walsh
"When I think about channels, what I'm thinking about is selling relationships." - Larry Walsh
Resources Mentioned:
- HP: https://www8.hp.com
- Cisco: https://www.cisco.com
- Microsoft: https://en.wikipedia.org/wiki/Microsoft
- IBM: https://www.ibm.com
Connect with Larry Walsh:
- LinkedIn: https://www.linkedin.com/in/lmwalsh2112/
- Email: lmwalsh@channelnomics.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an article published on March 31, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/why-you-need-to-price-before-during-and-after/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
You've heard it, you've probably said it, your company probably says it. Everybody thinks they're gonna land and expand. But what I want you to do is take a moment and think about all of the efforts, initiatives you have inside your company.
What is sales people work on what marketing people work on what products people work on. And I will bet you that most of the effort that you have goes on winning new customers, how do I win new customers? Surely we focus a lot on land. And by the way, we probably also focus on retention. But the thing companies rarely focus on putting true effort and energy behind is the expanding part of land and expand.
"Growth in subscriptions comes from land and expand, you focus on land already, focus more on expand." - Mark Stiving
What does expanded mean? It means I want a customer and they're paying me some amount of money, let's say it's $100 a month, how do I get them up to $125 a month, or up to $200 a month? Think about growing individual customers or individual buyers.
And that's what expand really means. If you're curious, there's only four ways I know to get more money from a current customer, we can raise their prices, we can convince them to use more of our product. And if we have the right pricing metric, then we get paid more. We could upsell them into a bigger package. Think good, better, best.
We get them to go from good to better. We could cross sell them into a different related package. But in the end, if we're not focusing on how we get more money from our current customers, we're ignoring the expand part of land and expand. That's probably where most of your opportunities for growth.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Anshu Jalorais the Founder and Managing director of Sciative Solutions Private Ltd., used to be a Director of Pricing Strategy at Starbucks, Pricing Scientist at PROS, and Director of Pricing at Overstock.
In this episode, Anshu talks about how true price elasticity brings about change in customers behavior and creates great impact in business. He shares about what his company, Sciative does at optimizing pricing, simplifying solutions from massive data to generate insights in lightning-fast speed necessary for decision making needed to make a maximum impact to the business.
Why you have to check out today’s podcast:
- Find out what Sciativedo to help businesses maximize value in the massive data available to them
- Find out the two crucial things that make a huge impact in a customer's traffic pattern
- Learn how to achieve bringing in customers from low-end products to high-end products with the understanding of price elasticity and consumer behavior
“Focus on three V’s - Value, Variety, and Velocity. As you're looking at your pricing processes, focus on these three V's.”
- Anshu Jalora
Topics Covered:
02:17 - An interesting story related to his Ph.D. story
03:30 - How he got into Pricing
04:07 - What made him like Pricing
06:09 - Success stories in B2C in terms of applying scientific models for pricing
08:52 - Capturing value through individual customer level or collection of customers together
09:32 - Talking about the coined word Sciative
10:39 - How can Sciative help businesses truly find value in the massive data that they have
13:36 - Price elasticity and consumer behavior
15:26 - Two things that basically make a huge impact on a customer's traffic pattern
21:20 - His thoughts on the criticism against price elasticity
23:55 - Playing with different types of mathematical models in coming up with true price elasticity
24:58 - What are Walmart parking lot products
28:26 - A pricing advice he shares that would have a great impact to one’s business
Key Takeaways:
“Pricing is a very powerful tool. It's educational for customers. Sometimes we guide customer behavior, we help customers figure out what is right for them. We make a direct impact on the business.” - Anshu Jalora
“What we found used to work best was that you don't have to take a blanket pricing approach everywhere, there will be some products where you will have more opportunities of increasing pricing without affecting customer sentiments and in some others you will not increase customer prices. You may even decrease prices to make the entire portfolio look competitive enough.” - Anshu Jalora
“I fundamentally believe that if you change prices, customer behavior will change and that is elasticity for me.” - Anshu Jalora
“Some very misleading information also get picked up by simplistic models, if we do not get into the nitty gritties and details and separate out seasonality effects, separate out cannibalization effects, cross price elasticity effect, we won't be able to compute the true price elasticity. And this is where elasticity gets criticized a lot. And that's what we try to avoid when you're educating customers.” - Anshu Jalora
People / Resources Mentioned:
- Andy Boyd: https://www.linkedin.com/in/andy-boyd-9760945/
Connect with Anshu Jalora:
- LinkedIn: https://www.linkedin.com/in/anshujalora
- Website: https://www.sciative.com/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
This is an article published on April 7, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/blog/how-to-price-hardware-like-its-software/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
It's true subscription buyers are looking to exchange money for benefits. But what's funny is I so often hear from executives and companies, we need to go subscription, we need to find a way to turn our business model into a subscription. I got to tell you that's very inside-out type thinking.
That's a company thinking about themselves and what they want. Now mind you, it's a great idea because of valuations for subscription companies are huge compared to more traditional or transactional type businesses.
"Subscription buyers are looking for a clear and easy exchange of money for benefits." - Mark Stiving
But yet, if they want to go subscription, instead of saying, how do we go subscription, we need to flip the script and say, What are the benefits our buyers are buying from us? What are the benefits they expect? And is there this periodic delivery or receipt of benefits that they're getting?
Because that's what we really want to do. Think about Porsche, again, is a great example of this. What are the advantages or benefits to owning a Porsche itself?
Well, I own a Porsche Well, actually, I don't, but I could own a Porsche because I want the fun of driving one. Or maybe I like the ego of being seen driving one. Or maybe it's because it's in my garage, and it's ready to go.
Anytime I want it. It's right there. And I probably drive it every day or every other day, I drive it a lot. So these are benefits you get when you own a Porsche.
But what about if you subscribe to a Porsche, could you still deliver all those same benefits, we're sure we can deliver the fun of driving one, you can still have the same ego stroke, when you're when you're seeing driving one, you can hold it in your garage and be ready, you can drive it every single day.
All those are great. And in addition to that, they can add even more benefits to the subscription.
For example, they cover the maintenance, they cover the insurance, you can change out cards, right? If you own your own car, you can't change a 911 for a career up or a 911.
For a Boxster, you've got to have whichever card is that they've got that you bought. And by the way, there's no real commitment. you commit a month at a time. I could go try it, I can see if I like the plan, I can cancel someday.
Think how hard it is to sell a car and switch cars. If you're really thinking about going to subscription, then what you want to do instead of saying how do we go subscription? Instead ask the question, what are the benefits that my customers expect on a periodic regular basis?
And by the way, what are the hassles that they have on a periodic or regular basis? And can we solve those using a subscription as well.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jim Broderick is a seasoned Pricing Professional with 20+ years’ experience across Marketing, Product Management/Product Development, Finance, Operations, Data Analysis and Sales; he has a unique ability to view Pricing from all dimensions. He also created and led the Pricing Function at a $500M Manufacturer/Distributor and a $100M Professional Services Company. He works cross functionally to achieve support in building the pricing function, pricing initiatives and overall strategy at the same time he is responsible for price uplift in excess of $50M over a 15-year career.
In this episode, Jim shares how the different roles he tackled helped him work his way up to being a Pricing executive. How he greatly impacted his business in just over three years is one area he details the process in achieving it. He talks about how value pricing and value selling is at the heart of providing solutions to customers and impacting businesses.
Why you have to check out today’s podcast:
- Learn how you can institute a value-selling process with your salespeople so you know your customer’s pain points and find solutions to their problems
- Find out how to see price as a proactive lever rather than a reactive pain point
- Discover the pricing skills and action steps you ought to have and implement to massively impact a business
“You have to talk to your customers. You have to be out from behind the desk, work with the sales people, figure out what makes them tick. How can they drink the Kool Aid that you are pouring in? Because if you can't get to that level, again, all the analysis in the world, if you can't get it in front of the salespeople, in front of the customers, it's a waste of time.”
- Jim Broderick
Topics Covered:
01:20 - From being a carpenter to a VP of Pricing
02:39 - The affordability of school back then compared to this time
03:30 - How he started consulting with small businesses
04:12 - The role he started out in and how he worked his way up to an executive-level Pricing position
06:03 - How does Excel fare from all the other BI tools around today
06:55 - The same but different way of writing Math in Tableau or Excel
08:13 - How changing jobs is like learning a new language and how he uses that idea to solve problems
09:58 - More than value-based pricing, it’s value-based selling
11:05 - Seeing value-based pricing years before and how it was achievable
13:12 - Value drivers are not internal - they have to be external from customers
15:15 - What he does around value drivers in his own company
15:58 - Instituting a value-based pricing
16:51 - How he made a $125 million impact
20:02 - Instances where you leave money on the table by not communicating your value
21:09 - Thoughts on compensating salespeople for price increase
22:53 - Impacting business for over just three years
Key Takeaways:
“I like to say when I'm talking to people about Pricing, I'm in the middle of the Rubik's Cube. Everything else is rolling around me. And I'm in the middle of the Rubik's Cube keeping it all together and making sure that the colors are lining up.” - Jim Broderick
“I think I had the benefit of coming from a Sales background. Because you know, part of what we do is we have to sell our story. We have to sell to the business, why is it important to do things the way we do.” - Jim Broderick
“If you want to advance to the level of director, or above in the Pricing world, you have to put yourself in front of the business, you have to.” - Jim Broderick
“I have a saying that I repeat all the time to anyone who will listen to me, we can create the most Math-based, value-based, algorithmic-based price you can come up with, if Sales can't translate that and sell it, it's a waste of time.” - Jim Broderick
“Identifying value drivers, in a business, quantifying the value drivers, and then training your sales people to change the conversation from price to the value drivers that are important to that customer.” - Jim Broderick
“Value drivers cannot be internal; value drivers have to be external from the customer.” - Jim Broderick
“I think that the most important thing [impacting business] is that you have an executive team that sees price as a proactive lever, and not a reactive pain point.” - Jim Broderick
People/Resources Mentioned:
- Reed Holden: https://www.holdenadvisors.com/about/leadership/
Connect with Jim Broderick:
- LinkedIn: https://www.linkedin.com/in/jimbroderick1/
- Email: broderick@unitedsiteservices.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
This is an article published on May 21, 2021, turned into an audio podcast so you can listen on the go.
Read Full Article Here: https://impactpricing.com/podcast/blogcast-4-pricing-consultant-vs-pricing-advisor-whats-the-difference/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Welcome to the Impact Pricing Memecast, where I take one of our daily names and provide a little bit more insight behind the words.
Think about Netflix for a second. My guess is if you're a Netflix subscriber or Hulu or wherever you get your video, you probably pay the bill every month, and you rarely ask yourself, should I stay with Netflix or not?
And yet, what do you think happens? When Netflix announces $1 a month price increase? You suddenly ask yourself?
Is Netflix really worth it? Am I getting the value? Now it's not to say that it's not worth another dollar. But it's to say that you rethink the decision. Were prior to them raising the price.
You never even thought about that decision.
"When you raise prices on your current subscribers, you cause them to rethink their decision. Be careful." - Mark Stiving
Now, if you're anything like me, in my old days, I used to pay for a gym membership.
And one of the things I found is even though I paid for a gym membership, I rarely went to the gym, I certainly did not get my money's worth.
And yet, if they never raise prices, I just keep paying the bill. Don't even think about it, because it's a decision that I had already made someday in the past.
But imagine what happens the day they say, “Hey, we're gonna raise your prices.”
Oh, now I have to say, you know, “I'm not really using it that much. I'm not getting my value out of it.”
I think I'll go ahead and unsubscribe or cancel my membership. In other words, when we raise prices on people who are subscribing, we forced them to rethink their purchase decision, where they're not going to rethink it regularly.
Probably not a bad situation. In fact, in many times in subscription businesses, we have the opportunity to raise prices, because we're delivering so much value to our customers. But what about those customers we're not delivering a lot of value to maybe it makes sense to not raise prices on them.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Steve Rosvold is the founder at CFO.University, a global professional development community dedicated to growing finance leaders by providing tools and learning opportunities suited to individual needs. Its focus is on delivering practical, convenient, performance enhancing learning, economically. Its community is made up of Member-Scholars, Companies, and Trusted Advisors committed to the development of finance leaders.
In this episode, Steve shares what CFO University hopes to help CFOs in terms of value-based pricing and not just setting the margin, and tapping its influence on the entire company to give more value to the organization.
Why you have to check out today’s podcast:
- Find out about CFO University and the education they provide around value-based pricing for CFOs so they become more creative and innovative in providing a more positive influence on pricing to the company
- Learn how Sales, Marketing, and Finance can create a cooperative and collaborative dynamic that boosts value to the company
- Find out where CFOs can find opportunity to learn more value in discrete products and product portfolios that work
“Learn the language of your sales and marketing teams and use that to help define what they need, and go out and get the data for that.”
- Steve Rosvold
Topics Covered:
02:17 - What do CFOs generally think about Pricing
03:30 - CFOs’ reaction to an article published about value-based pricing
04:53 - The hard work that goes into educating CFOs about value-based pricing
05:54 - The reason why CFOs don’t emphasize pricing
08:20 - Learning how to test the value rather than just setting the margin
09:32 - How the cost part is the CFOs domain in the past
11:04 - The whole strength of the CFO
13:16 - What CFOs do a really good job of
14:46 - Creating a collaborative effort among Sales, Marketing, and Finance
17:13 - Not doing it the way they should be doing it
18:32 - What scares people of the CFO
20:26 - Where CFOs have to learn more about value in pricing
21:56 - Steve’s pricing advice that will impact your business
23:27 - When do financial transformation takes place
Key Takeaways:
“We're frankly learning about how to test the value, rather than set the margin.” - Steve Rosvold
“I think that whole customer journey, the Finance teams can help a lot with the data they have, and help influence and really give insight to the marketing, the pricing, and marketing teams.” - Steve Rosvold
“There's been a kind of a contentious dynamic where it really should be very cooperative and collaborative. And then if we get to that point, now we've got this super power being created between Finance and Sales, and Marketing that boost value in companies.” - Steve Rosvold
“The whole idea of looking at net present values and future cash flows, we're great at that, but that's the big picture, looking at other companies. When it comes to these discrete products that we're selling, and trying to put a portfolio of products together that works, I think CFOs aren't very strong in that generally. And there's an opportunity there.” - Steve Rosvold
“Transformation takes place when value goes up, and costs go down. It's two levers and both have to happen. So, we're really forcing Finance people to really get on the value side of things, whether that's products or their services or systems or whatever.” - Steve Rosvold
People/Resources Mentioned:
- Andrew Codd
Connect with Steve Rosvold:
- Website: https://cfo.university/
- LinkedIn: https://www.linkedin.com/in/steverosvold/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- LinkedIn: https://www.linkedin.com/in/stiving/
To start with, I strongly believe finance should NOT set prices.
Now don’t get me wrong – finance cares a great deal about pricing, because part of their job is to monitor profitability. They need to determine how profitable the company will be, and pricing is a major part of this. They care about pricing, but they should not SET prices.
Here’s the problem: those in finance don’t know the real value of their products. If they set prices, the only strategy they use is cost-plus pricing. Anybody who knows anything about pricing knows this is the wrong answer if the goal is to maximize profit.
This isn’t to say finance teams can’t play an important role in pricing. There are many ways, including:
Margin guidance: Finance knows what investors/owners expect in terms of overall margin. They can give guidance to those in charge of pricing, who then can ensure the blended margin, across all of their products, achieves the margin goal.
Margin floor: Some companies set a margin floor, meaning they won’t accept any business at a margin below that level. I’m not a huge fan of margin floors, because sometimes companies can accept business at a loss in order to gain other business at a profit. However, one of the roles of finance is to mitigate risk for the company; margin floors help significantly in this capacity.
Price monitoring: Now is where those in finance and pricing can and should work closely together. Finance constantly collects and analyzes data about the business. The two groups should think about what information around pricing will help them understand the health of the business. For example, monitoring average discounts by product could indicate that market conditions have changed. The win/loss ratio is another indicator of changes in the market. There are many other KPIs or measurements that can be monitored by those in pricing and finance.
Pricing committee participation: some companies have a dedicated pricing committee where representatives from different parts of the company come together to discuss and improve pricing practices. Finance should absolutely be one of those participants. As price methodology changes are suggested, finance plays a critical role in projecting the financial impacts of those changes on the business.
Price leadership: In a rare but powerful role, finance can take the lead on pricing. In this role, finance directs and monitors all pricing activities within the company. They spearhead the finding and fixing of all the profit leaks, including the product lines, sales, and even accounting. This is an ideal role for finance for several reasons:
- Pricing success is vital to the success of the company.
- Nobody else in the company generally takes on this role.
- Finance often has enough power to strongly influence all departments, and all levels.
- Finance already works closely with every department in the company.
An engaged and informed finance department can allow a company to have far more successful pricing. It’s just that finance should NOT set prices. They know numbers, they just don’t know value.
Read Full Article Here: https://impactpricing.com/blog/should-finance-influence-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Often people ask if I offer consulting services. I hate that question because I have to honestly answer no, but then explain I offer advisory services. Here is what you might want to know about being or hiring a pricing advisor.
What is the difference?
In my career, I’ve hired and worked beside pricing consultants. For each project, they typically have an experienced leader who commands a team of less-skilled workers. The team gathers and analyzes data and recommendations are made to the hiring executive. Companies who follow the recommendations often find phenomenal results. The key is that consultants do the work and present their findings.
A pricing advisor works with executives and teams within the client so they can solve their own pricing problems. This happens through a combination of education and frequent consultations. The advisor asks many questions and applies his/her vast pricing experience and knowledge to the client’s specific situation. Instead of making recommendations at the end of a project, the advisor discusses ideas throughout the engagement. When data needs to be collected or analyzed, the advisor helps the client understand what to do and the client is responsible for the execution.
Should you choose a consultant or an advisor?
It depends on your situation. If you have money but not people resources, a consultant is probably your best choice. If you don’t have a lot of money, but you have people to work on the project, then an advisor probably fits better. An added advantage to using an advisor is your people become more skilled at pricing and value.
What about a coach?
I have a lot of friends who are coaches so I have to tread lightly here. My understanding is that coaches ask a lot of questions to guide you to find the answer yourself. That may help the lessons stick better, but it is slower. An advisor asks questions to understand your situation and then makes recommendations. I often think of myself as a coach as I’m helping individuals uplevel their skills, but my coaching friends tell me that’s not coaching.
Is education enough?
I’ve taught pricing to thousands of students over the last 27 years, and I’ve learned even when students understand a concept, they aren’t able to apply it to their situation. That takes practice and guidance. To those of us who have been doing it for so long, solutions sometimes seem obvious, but experience shows it is challenging for new practitioners. Education is a significant first step that benefits dramatically from implementation assistance.
What makes a good advisor?
Here are three important characteristics of a great pricing advisor.
Pricing expertise – A true pricing expert has worked in many industries, solved many different pricing problems, and has created a set of principles that apply in most situations. True experts study their field and create thought leadership content to share with the world. They willingly engage with other experts and practitioners to push the boundaries of knowledge.
Communication skills – Knowing pricing isn’t enough. A pricing advisor must be able to communicate their ideas and reasoning to their clients in ways that resonate. Clients can only make good decisions when they understand the options.
Helpful attitude – Pricing advisors must know their role is to advise, not make decisions. Their job is to help their clients make the best decisions possible. This requires an attitude of service, not a belief that they know everything.
Is Mark Stiving a good pricing advisor?
YES! (I had to say that since I’m writing this.) However, here is some supporting information.
Pricing expertise – I’ve been in pricing for over 27 years. Here are some highlights.
- Ph.D. in pricing (marketing) from U.C. Berkeley
- Two pricing articles published in top tier academic journals
- Experience as a pricing executive at a $2B technology company
- Started, grew, and sold 2 businesses
- Helped companies with pricing in many different industries
- Author of Impact Pricing: Your Blueprint for Driving Profits (Entrepreneur Press 2011)
- Author of Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business (Morgan James Publishing, October 2021)
Communication skills – I love to teach and help people succeed. As an educator, I’ve created ways to simplify pricing concepts so more people can learn and use them. I’ve been teaching at least part-time most of my career. Here are a few highlights to demonstrate my ability to communicate complex concepts.
- Distinguished Toastmaster
- NPS score of 81 when teaching for Pragmatic
- Blog weekly on pricing since 2010. Initially at pragmaticpricing.com and now impactpricing.com
- Host the Impact Pricing podcast
- Created 10 different pricing courses in my career … so far
Helpful attitude – I will always tell you what I think, but all decisions are yours. I am never upset if you don’t like or use my advice. I know pricing better than you. You know your company and market better than I do. My job is to make sure you have more relevant information to consider when making decisions. Your job is to decide and execute. Our time together will be spent discussing your specific situations, me teaching how relevant pricing frameworks and strategies may apply, and us discussing whether and how to apply them.
Before committing to pricing, I was an electrical engineer and a sales engineer (with a quota). These, plus my experience starting and running companies make me empathetic to every role inside your company.
One of the most fascinating things I found as I was researching subscriptions. Is traditional businesses. Don't really care if you use their product.
Think about it for a second. You're going to buy a Porsche and you take the Porsche home and you put it in the garage and you put a cover on it and you never drive it for the next 10 years, 20 years. Do you think Porsche cares or were they just happy that you bought it and they got your money? But imagine subscribing to a Porsche.
“If you think of value as what is a customer willing to pay. Buyers who don't get value are going to churn out.” - Mark Stiving
And it's very different. If you're going to pay pours $2,000 a month for the right to drive a Porsche, are you ever going to put it in your garage and put a cover on it and not drive it? That because if you do that, you're not getting any value at all for your $2,000 a month. What we're really talking up then his company subscription companies need to retain customers.
When you think of win, keep, grow, this is the key part. I can go out and win a new customer, but I have to keep them happy. I have to keep them using my product to, in order to get value from my product.
And hence comes the customer success department. We didn't really see customer success before subscriptions came along.
But now that we have subscriptions, we have customer success departments because we need to get people up to receiving value for our product as quickly as possible. We think of that as time to value. We need our buyers to continue getting value over time, and maybe we can get them to, to earn more and more value.
And we do that by customer success, sharing with them, hints and tips on how to use the product better. And maybe we can even customize those, especially for SaaS businesses.
When you can see how people are using the product, you can likely say, yes, they're not being as efficient in this area as they could be.
Maybe we could give them some hints. Customer success then creates value.
If you think of value as what is a customer willing to pay. Buyers who don't get value are going to churn out.
They're not willing to pay anything. Keeping buyers receiving value for our product then really does create value because value is what a customer is willing to pay.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Dave Daniels is a launch guru helping businesses plan successful product launches.
In this episode, Dave shares how understanding market segmentation will help you figure out what consumers are willing to pay so you focus on that segment when you launch a new product. If you are an early-stage company who is concerned about building out a product, you can listen to Dave talk about growth hacking concepts. He also talks about the obstacles and advantages concept you can derive insights from.
Why you have to check out today’s podcast:
- Learn about the factors to consider in revisiting your pricing so you don’t leave money on the table
- Discover about using objectives and key results (OKRs) for a clearly defined product launch success
- Learn how to figure out where the least resistance lies so you meet your product launch objective and key results
“I would deeply understand their motivations for solving the problem that they want to solve. Because how acute that motivation is will largely determine what their willingness to pay us.”
- Dave Daniels
Topics Covered:
02:07 - Talking about the price class he took while he was at Pragmatic Institute
03:56 - Using objective key results for defining a successful launch
06:06 - What does it take to launch a product
07:32 - How do pricing and product launch tie together
11:57 - What is a concept of obstacles and advantages
14:38 - Why is it easier for startup companies to figure out their obstacles and advantages
17:37 - Taking the whole growth hacking concept for startup companies
19:31 - Setting price for new products
22:06 - How frequently do you change your price
24:39 - Validation of pricing by market segment
25:24 - How to factor in price segmentation over the lifecycle of a product
27:07 - Willingness to pay and how everybody relates to this phrase
29:07 - Your reputation and charging premium
Key Takeaways:
“Everyone says I want a successful product, but few of them define what success actually is. And so, my thinking has now evolved into using objectives and key results, OKRs, as a mechanism for clearly defining the success of a launch.” - Dave Daniels
“Your market segment and that competitive landscape will influence the willingness to pay for buyers that are in that market segment.” - Dave Daniels
“In order for us to be successful with that customer in that market segment who's willing to pay the price that we want to charge, then what are the barriers that will keep us from being successful? So, what are our obstacles because we got to get rid of those.” - Dave Daniels
“As a startup, that's a lot easier to figure out your advantages and obstacles. Because if you look at the ledger, you have a whole lot of things in the obstacles column, and you have very few things in the advantages column.” - Dave Daniels
Connect with Dave Daniels:
- LinkedIn: https://www.linkedin.com/in/davidkeithdaniels/
- Email: daviddaniels@brainkraft.com
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com
Many companies use cost-plus pricing. In fact, I’d say nearly all hardware companies, and service companies with fixed costs, use cost-plus pricing in some way. And yet, pricing people know this isn’t ideal (or at least, they should) since it leaves money on the table.
Most of the time, cost-plus pricing doesn’t make sense. Imagine you build a product for $10, and want a 50% margin. This means you price is at $20. But what if your market would pay you $50? Shouldn’t you try to capture that? And what if your market would only pay you $15? At $20, you either leave money on the table, or you don’t sell. It’s an arbitrary number, based on what you want – rather than a meaningful figure, based on your customer’s willingness to pay.
We should always, as much as possible, price based on how much our buyer is willing to pay. Easily said, hard to do.
Now, why do companies use cost-plus pricing? It’s usually because they want to cover their costs while being competitive on price. Finance set margin goals for the company, and this becomes the cost-plus price-setting mechanism. Note however, that this is not a great reason to do cost plus. It might look like you’ll meet your margin goals on paper, but it doesn’t optimize the return on your innovation.
That being said, I can think of a couple of instances when it makes sense to use cost-plus pricing:
If you have tens of thousands of products to price, it would be cumbersome and unrealistic to use value-based pricing (VBP) on every single one. Imagine you are pricing every item at a retailer, or every item at a distributor. Pure VBP isn’t practical in these circumstances.
However, in these situations, we can and should use VBP for portfolios of products. There may be brands or product lines where you have no competition, for example. Those should have higher margins. The brands or product lines that tend to attract new customers should have a lower margin. Even though you are likely using a cost-plus pricing model, the ‘plus’ part doesn’t have to be identical for every product. The margin you can earn should be dependent on the product, the competition, the buyers and their buying process (especially the last two).
The other scenario where cost-plus pricing makes sense is when your costs fluctuate dramatically. For example, in the chemical industry, it is common to quote prices as a function of the price of a raw material. Buyers see this as fair, and it helps finance people maintain their margin goals. However, even in this situation, you still want to use the underlying principles of VBP to determine what margin you should charge different types of customers or situations.
So, yes, cost-plus pricing can make sense some of the time. However, blanket cost-plus never makes sense. Even when we feel we have to use cost-plus pricing, we should still look for ways to charge our buyers as close to their willingness to pay as possible. Don’t just accept cost-plus pricing on its own. If you do, I guarantee you’re leaving money on the table.
Read Full Article Here: https://impactpricing.com/blog/when-you-should-use-cost-plus-pricing/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Is subscription a business model or payment model? Probably the easiest example to think through is Porsche.
Yes, you can subscribe to a Porsche.
But before I describe that to you, let me talk about buying a Porsche. Let's say you want to go buy one, there are four different payment models that you could use.
You could pay cash, you could take out a loan from a bank, you could take out a loan from the dealership who's selling you the car, and you could lease the vehicle.
“Subscription is a business model, not a payment model. ” - Mark Stiving
Now, leasing may not be exactly ownership, but it acts almost exactly like owning the vehicle. In each of these four cases, the experience from the consumer is almost identical when it comes to the product. The only thing that's different is how we ended up paying for it.
But now let's jump to the subscription. In Atlanta for sure, you can subscribe to a Porsche for a measly 2000 or $3,000 a month, you can drive any Porsche you want, any day you want. That's pretty cool. They'll even cover all the maintenance fees, they'll pay for the insurance, you're simply paying for the right to drive a Porsche whenever you want.
Notice that's a very different experience than owning a Porsche.
Can you think through what are the benefits that your buyers are expecting when they buy your product and use your product?
And is it possible that we could, we can take that product and that series of benefits that they're truly looking for, and deliver the benefits to them without requiring them to own our product?
And then could we deliver those benefits so it's a stream of benefits?
And the stream of benefits never ends, it goes on forever. In that case, maybe our buyers will pay us forever.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jon Jennings is the Founder and Managing Partner of Jennings Executive Search, LLC. He began his career with a boutique recruiting firm, building relationships with C-Level accounting and finance professionals utilizing a research-based approach of study and analysis to best serve his clients.
In 2012, Jon took this approach to a larger firm where he worked with several CFOs to build entire accounting and finance departments and gain a large firm perspective in how to build a successful practice. This experience led to the creation of Jennings Executive Search, LLC.
In this episode, Jon talks about how he matches pricing talents depending on a strategy the company uses and each company’s preferences, what screening process he uses when looking for pricing people. He also shares how he guides companies in choosing the best pricing leader they can get as sometimes they don’t know what they are looking for. He also emphasizes on skill sets a pricing person should develop and acquire early on as he starts to elevate his career along the way.
Why you have to check out today’s podcast:
- Learn how to build out your skillset as a pricing person so you get more relevant in today’s competitive world of pricing
- Find someone who knows Pricing people if you are looking to hire Pricing leaders
- Discover how to find Pricing people that match your company’s strategies to get a good fit to impact the business
“Think about what you're leaving on the table. If you're not trying to be creative around pricing, you're losing. If you're not thinking about ways to add some sort of dynamic element in trying to find ways to increase profitability from that standpoint, then someone else is.”
- Jon Jennings
Topics Covered:
01:39 - How he got into Pricing
03:15 - What do they focus on when hiring Pricing people
03:50 - How the company’s strategy matter when hiring Pricing people
05:42 - Delineation of roles among Pricing analyst, the VP, and the middle level
07:03 - HIs screening when looking for Pricing leaders
08:37 - How they provide guidance to companies when looking for Pricing leaders
09:39 - Building off of the job description, value-based principles, and the roadmap of the company to find potential Pricing leaders
11:53 - How he helps clients find Pricing people
13:49 - Starting with questions to convince a company to hire a pricing person
15:10 - Suggesting to companies to listen to Impact Pricing
15:32 - How value-based pricing makes sense in the world of recruitment
16:48 - Skillset you need to build as a pricing person early on in your career
18:16 - What more you can do to expand your capabilities as a Pricing person
19:40 - Beg, borrow and steal
20:44 - Be a driver and not a whiner
21:06 - Are pricing people well compensated
22:37 - Setting differentiators for Pricing persons to match with client companies preferences
23:48 - Setting expectations for yourself and executing it
25:20 - The strengths and weaknesses of a consulting talent
27:15 - HIs impactful advice to help you in your business
Key Takeaways:
“Our job is to find people who make impacts with fitting culturally and have a history of really impacting the business.” - Jon Jennings
“It's really about me kind of telling them [client companies] a story, and asking questions to see if I can guide them to a more dynamic solution if they're not already there.” - Jon Jennings
“I always start with questions. Because I can't give advice without context.” - Jon Jennings
“If I'm advising someone, I have to build out their skill set. There's a couple of elements that you want especially nowadays. Get into as much data science as you can, teach yourself coding. It doesn't matter, as you get to higher levels, obviously, you're not going to utilize that as much, but you're going to still use that a little bit.” - Jon Jennings
“As you move up the organization, it's about reaching out across company lines, and not being afraid to go talk to the marketing person, pick people's brains. Try to expand that knowledge as much as you can and just always be learning. That's how you can elevate your career.” - Jon Jennings
“Be a driver. Don't be afraid to challenge above you. If you believe in your concept, just be the squeaky wheel until you get some traction.” - Jon Jennings
“Being mindful of constantly trying to improve your strategy and looking at competitive advantage and all different elements is 100% key.” - Jon Jennings
Resources / People mentioned:
- Professional Pricing Society
- McKinsey
- BCG
Connect with Jon Jennings:
- www.jenningsexec.com
- Email: jon@jenningsexec.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
On April 20, 2021, the Wall Street Journal published an article titled Procter & Gamble Will Raise Prices in September.
Here are the first three sentences:
Procter & Gamble Co. this fall will start charging more for household staples from diapers to tampons, the latest and biggest consumer-products company to announce price hikes. The maker of Gillette razors and Tide detergent cited rising costs for raw materials, such as resin and pulp, and higher expenses to transport goods. The announcement, which came as P&G disclosed its quarterly financial results, follows a similar move last month by rival Kimberly-Clark Corp.
“Blame costs. Announce your price increases. And watch your competitors.”- Mark Stiving
In these three sentences are three incredible lessons on raising prices.
Lesson 1: Blame costs
Costs probably did go up, but I would bet the costs went up much less than the price. Costs are pretty much the only reason customers accept for price increases. The truth is probably closer to this sentence. “P&G will raise prices so they can make more profit because they believe their customers are willing to pay more.” It’s probably true, but they could never say that.
Lesson 2: Announce your price increases
Notice that last month Kimberly-Clark announced a price increase (and they blamed increasing costs). Their price increase isn’t due to take effect until late June. Since I’m writing brutally honest news copy, this is what their news release could have said, “KC is announcing a price increase for late June, but they will only implement it if competitors like P&G also agree to a price increase.” To say this out loud is a violation of the law. It is illegal to collude with competitors. But the implication is there.
Lesson 3: Watch for competitor price increases – Decide carefully
P&G likely saw the KC announcement and thought, “we could raise prices or we could keep prices low and take some additional market share.” But what would happen if they didn’t raise their prices? KC likely would not have gone through with their price increase and market shares don’t change. However, if P&G raises their prices, KC goes through with their price increase, market shares still don’t change, and everyone makes more money. This is called implicit collusion. Nobody talked to anybody, they just made assumptions about how the other company would act.
It is possible that I am completely wrong on this. It is possible that costs really did go up. That both KC and P&G independently and myopically decided to raise their prices for the sole purpose of covering their costs. But that doesn’t negate the lessons. Blame costs, announce your price increases and watch your competitors.
Resource Mentioned:
- Procter & Gamble Will Raise Prices in September
Read Full Article Here: impactpricing.com/blog/three-lessons-from-a-pg-price-increase/
If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Pricing metrics really should be correlated with your customer's value metrics.
First off, what's a pricing metric?
A pricing metric is what you charge for. If you're salesforce.com, you are charged by the person.
If you're Dropbox, you might charge by the terabyte of storage. You might charge by the click, you might charge by the view or the exposure. There are lots of things we can choose to charge by, you have to make a decision, what are you going to charge for? That's your pricing metric.
“The best pricing metrics are highly correlated with users’ value metrics. ” - Mark Stiving
Well, how do you make that decision? One really important thing to think about is, is it correlated with your customers value metric? A value metric then, is how does your customer measure the value of your product.
I like to play a little game with my clients and I say, "Fill in the following blanks. My customers love me because they're blank went from blank to blank." That could be their turnover went from 8% to 6%. That could be their productivity went from 1000 units per hour to 1200 units per hour. There's some metric they're using that they're saying, "Hey, when we use your product, it really helps us in this area, and here's how we measure that."
The great thing about having a pricing metric that somehow highly correlated with our buyers value metric is as our buyers get more and more value, we end up getting paid more, and our buyers don't mind because they're getting all that value.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, please let me know. If you have any feedback, definitely send it. You can reach me at mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Matt Johnston is the Founder and CEO of EPIC Conjoint. As a highly motivated seasoned commercial marketing professional possessing 25 years Pricing, Product and Segmentation experience with Tier 1 brands in Europe, North America, MENA and Southeast Asia, he is a huge fan of conjoint analysis but massively frustrated with the time, effort and cost barriers to conducting a conjoint study. So, instead of grumbling about its limitations, he designed and developed his own rapid conjoint platform EPIC Conjoint.
In this episode, Matt talks about the confidence and reassurance conjoint study provides in coming up with crucial pricing decisions. And how it helps you differentiate from competitors. He also shares how he started EPIC Conjoint to provide a simple, fast, and inexpensive conjoint study.
Why you have to check out today’s podcast:
- Find out a more cost-effective conjoint analysis to help in your company’s pricing decisions
- Find out how conjoint analysis not only help in pricing decisions on new products and services but also on the existing product context
- Discover how close to the truth you can get in terms of assurance that is statistically significant to your pricing decisions
“It's always very important to look at the transactional data, the behavioral data, the previous data that will inform your assumptions. But then cap it off by asking the customer.”
- Matt Johnston
Topics Covered:
00:57 - How it was like starting his pricing career at Comedy Central
01:26 - An Impact partner in the course creation
03:03 - A funny story of how Matt started in Pricing
04:43 - How most pricing people never started with a pricing role
05:45 - What made start EPIC Conjoint
07:13 - The budget and the investment involved in designing conjoint analysis
08:41 - What drove the timing to put up EPICConjoint
10:18 - Bringing automation and rigor into the pricing process
14:31 - What do you need EPIC conjoint for
18:04 - How EPIC conjoint gives you an amazing capability to differentiate yourself based on value
19:32 - How conjoint captures price sensitivity
19:57 - Conjoint analysis being a big help in B2B companies
21:38 - How close to the truth can you get with conjoint analysis
22:15 - Matt’s impactful pricing advice on your business
Key Takeaways:
“The point I'm trying to make is, actually there are a lot more use cases that you can apply conjoint to because it is a trade-off methodology.” - Matt Johnston
“We capture that price sensitivity as well, in conjoint, at a segment level so you do see it, you can see that change.” - Matt Johnston
“It [Conjoint] can keep the middlemen honest even within your organizations, the sales folks, it can keep them on as to where you can leapfrog them and actually check and see what exactly the customers are saying.” - Matt Johnston
“The comfort and the confidence of launching them - new products or making price changes. Having done a conjoint, having been in that situation, is priceless.” - Matt Johnston
Resources Mentioned:
- Van Westendorp
- O2 plc
- Telefonica
- Vodafone
- Sky News
- New York Times Company
- Tribune Company
Connect with Matt Johnston:
- Epicconjoint.com
- Email: mattjohnston@epicconjoint.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Understanding your customers' decisions is fundamental to value based pricing, especially in subscriptions.
When we think about our customers' decisions, especially in subscriptions, we want to break it up into those three different revenue buckets we talk about - Win, Keep, and Grow.
When we're trying to win a customer, a customer's making those "Will I and which one" decisions, you've probably heard me talk about those two topics or those two decisions on ad nauseum. And if you haven't, you'll find tons of content, and one of these days I'll do a memecast on those as well.
But keeping, if we want to keep customers, what's the decision they're making? Most often, they're actually not making a decision at all. They're just using our product, they're just writing us checks or letting the credit card go through.
“Understanding your customers' decisions is fundamental to value-based pricing, especially in subscriptions. ” - Mark Stiving
The last bucket, grow, has a ton of different decisions that we need to focus on. Because maybe we want to raise prices on them, that's drawing attention and making them rethink. But, have we provided enough value that we're pretty confident they're not going to turn out?
What about usage, maybe we can get them to use more? As they use more, they're willing to pay us more, and they say, "Hey, that seems fair." That's a decision that they have to make. Maybe we want them to buy more from us. Maybe we want them to upgrade into a new product or buy a different product from us. This is us thinking about the decisions our buyers are making.
Value-based pricing is always putting yourself in the mind of your buyer. In subscriptions, there are several different decisions your customers have to make in that relationship lifecycle. And we want to think about each one of those decisions.
We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, or if you have any feedback, please email me, mark@impactpricing.com. Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Lindsay Duran is the Chief Marketing Officer at Zilliant. Over the course of her career, she focused on uncovering inefficient and sub-optimal processes and actively worked to solve those challenges with creativity, whether it's developing a new go-to-market methodology, revamping a marketing organization, or, in her current role, helping clients realize better financial results through artificial intelligence and sales rep enablement.
In this episode, Lindsay talks about what Zilliant does in terms of providing a pricing system that helps you how to price your products, more effectively manage your customer price agreements, and point your salespeople to the actions that are going to drive the most revenue and margin growth and systematically do that.
Why you have to check out today’s podcast:
- Learn how Zilliant’s pricing system can calculate and measure price elasticity for the different segments to come up with price optimization for the goal you are trying to achieve for the said price
- Find out how to pinpoint the best selling price to charge given the complexity of pricing decision in every selling circumstance
- Find out the problems Zilliant can help you with to effectively and efficiently deal with pricing decisions that drive revenue growth
“Stop relying on spreadsheets. Spending your time manipulating data in spreadsheets and trying to execute price changes in spreadsheets is underselling the value of pricing professional.”
- Lindsay Duran
Topics Covered:
01:30 - What led Lindsay into pricing
02:00 - The mix of roles she held at Zilliant
02:46 - Thoughts about ‘product marketing and product management people
03:06 - The bias to over discount
04:06 - What does Zilliant do?
07:45 - Elaborating on segmentation and willingness to pay of customers
10:27 - Giving her thoughts on price elasticity
14:48 - What is the digital transformation of sales
18:36 - Why do we still need salespeople in the online sales setting
21:07 - Salespeople and price negotiations
24:24 - Helping customers’ handling of thresholds and rules
30:03 - The problems Zilliant solves
30:42 - Lindsay’s one piece of pricing advice that will greatly impact your business
Key Takeaways:
“What we do at Zilliant, as we help companies using software and using data, and Data Science, figure out what is the best price that they should charge in every selling circumstance. And then we help companies figure out how to manage all of the processes that go along with setting, updating, executing prices in the market.” - Lindsay Duran
“For those that like to argue that price elasticity can't be measured, I would encourage everyone to raise their prices by 50, 100, 200% and see what happens to their volume. There is a point at which you are past the profit-maximizing price, and that your volume is going to drop off and go to zero if you are too far out of the market.” - Lindsay Duran
“Digital transformation is seeing it on two fronts. It's the shift to e-commerce and the need to provide salespeople with more Data-Science-driven guidance, to help them be more effective at their job and ultimately meet customer expectations.” - Lindsay Duran
“It's really up to the strategy of the company as to how they want to handle those thresholds and rules and we're simply there to not tell them how to approach that but make that work systematically so that the outcome is what they've requested.” - Lindsay Duran
“As much as you can rely on data and technology to do some of that very heavy lift, often not value add, but critical steps. You can spend more of your time on the actual pricing strategy portion of it and figuring out the opportunities where you have the biggest areas of impact and where you need to focus your time that isn't on all of that kind of manual data manipulation that so many people get mired in.” - Lindsay Duran
Connect with Lindsay Duran:
- E: lindsay.duran@zilliant.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
The secrets to a successful subscription really are to win, keep, and grow. Traditional companies meaning those that are typically transaction-oriented, know about winning. And in fact, subscription companies have to win customers as well.
Now, subscription companies also relatively quickly learn what it's like to keep a customer.
Because if they're not focused on keeping customers, that customer retention piece, they quickly go out of business, their customer acquisition costs exceed the amount of revenue or profit they can get from any individual new customer.
“The secrets to a successful subscription business - Win, Keep, and Grow.”
- Mark Stiving
Subscription companies get the key part of win, keep, and grow, as well. However, most companies overlook the grow part. And grow means, "Can you get a customer to pay you more next year than they paid you last year?"
And that doesn't necessarily mean raise prices. It may mean that they use more, it may mean that they upgraded, it may mean that they added more capabilities, it may mean that they bought something else. And yes, it may mean that you raised prices.
Zoom, when they went public if you took the set of customers they had a year before they went public, that exact same set of customers paid them 40% more the following year. This is amazing. And that's really the goal. If you want to be a real successful subscription company, you need to grow, and you need to keep, and you need to win. The secrets then, win, keep, and grow. You need to focus on all three of these revenue buckets, but you need to focus on each one individually.
If you've seen any of our memes that you'd like to move to the top of our memecast list, or if you have any feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jon Manning is the Head of Pricing / Chief Economist at MYOB and Author of "Overcoming Floccinaucinihilipilification: Valuing and Monetizing Products and Services". His career has been a journey through the most commonly used pricing methodologies: the cryptic world of oil industry pricing, cost-plus pricing in catering & consumer packaged goods, revenue/yield management in aviation, travel & tourism, and dynamic pricing in internet cafes on the High Streets of the EU and USA.
In this episode, Jon shares that more than relying on Twitter and Facebook likes, especially with startup companies, it's essential to have a pricing model at the start, so you provide and create value at the onset. He talks about the book and how it tackles the end-to-end journey in the world of value creation, understanding, monetization, and communication of value.
Why you have to check out today's podcast:
- Discover and understand the value-based pricing canvas so you can provide value even at the start of your business
- Learn to identify the sources of value in your product and services to define your value proposition clearly
- Find out how you can be focused on value creation but making it more powerful with behavioral economics in consideration
"It's all about value, really. So, just make sure you understand the value. And if you're monetizing value you just can't go wrong."
- Jon Manning
Topics Covered:
01:25 - Talking about Jon's book: Overcoming Floccinaucinihilipilification
03:40 - How does a crowdsourcing website work for Pricing Prophets?
06:35 - What is a value-based pricing canvas as the main gist of Jon's book
08:30 - How each cell in a canvas work
10:34 - Talking about the internal pricing processes and customer-facing processes in the pricing canvas
13:18 - Where creating value appears in the book
15:28 - Talking about the second half of the book about customer value analysis
16:43 - Why Jon put behavioral economics at the last part of the book
20:24 - Sharing an exciting experience where behavioral economics is concerned
21:36 - What got Jon started in Pricing
22:38 - The best pricing advice Jon shares that can have a significant impact in your business
Key Takeaways:
“What's really been interesting is that sort of six, seven years down the track, when I go into those workshops now, nine out of 10 businesses do have a pricing model when they start. They realize they provide value from day one.” - Jon Manning
“The first part of the book is to make use of the canvas to identify the sources of value in your product or service. And that's a collection of approximately about 15 quadrants which will help you be able to clearly define your value proposition, the economic value you provide, how you stack up against the competition and things like that.” - Jon Manning
“The second half of the book then says, okay, let's take your understanding of value now. And let's actually strike a price point for you based on one of four value-based pricing methodologies. So, it's a sort of end-to-end journey.” - Jon Manning
“One of the methodologies I walked through in the second half of the book is customer value analysis. And I only talk about a very basic version of customer value analysis, but just through that exercise, and other methodologies that other authors have written about, you can quickly identify features that should be included or excluded from a package if you're asking the right questions to customers.” - Jon Manning
“I like behavioral economics, it is useful. I agree that it should be value first, behavioral economics second, but it can also be powerful at the same time.” - Jon Manning
People/Resources mentioned:
- Overcoming Floccinaucinihilipilification: Valuing and Monetizing Products and Services by Jon Manning
- Zen Ore
- 99 Designs
Connect with Jon Manning:
- https://pricingprophets.com/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
How do you determine how much to charge for a product? Figuring out how much somebody's willing to pay for a product seems like a really simple question, but in practice, it's not that easy.
The problem with asking people what they're willing to pay is you have to ask them at the exact moment when they are ready and able and motivated enough to give you an answer.
"The most profitable pricing decision really is to adopt value-based pricing."- Mark Stiving
By value-based pricing. I always charge what a customer is willing to pay. If you think about it, that's perfect pricing. It's not possible to get a price higher than what a customer's willingness to pay. If I could always charge whatever any customer is willing to pay.
I have absolutely maximized the amount of revenue and profit that I can get for my company. By now you figured out that that's not really possible. I can't read somebody's mind. I don't know how much they're going to be willing to pay me. But instead of thinking about this as, 'Oh, we have to be perfect at value-based pricing.'
Let's accept it as a goal or as an attitude. And when we think about doing price execution and the daily tasks that we do, or the strategies we create in every decision that execution should be all about, how do we get closer to this idea of charging? What a customer is willing to pay. And that is the most profitable pricing decision you can make.
If you've seen any of our memes that you'd like to move to the top of our memecast list, or if you have any feedback, please email me mark@impactpricing.com.
Now, go make an impact.
Kevin Mitchell is the President of The Professional Pricing Society (PPS), the worldwide professional organization dedicated to pricing training, education, and networking.
In this episode, Kevin shares what a pricing professional should be -- one that is not only adept at pricing strategies but can articulate, communicate, and negotiate in and outside the organization.
He also talks about the pricing career path that the Professional Pricing Society provides in its pricing education. He doubles down on saying that every money that goes into what the company spends on and the revenue generated ties back to a pricing decision at one point in time.
That’s why it is best to learn and understand pricing so we can make the best decisions. Because this would impact the organization and the people who work hard to create value in the products and services available to the consumers.
Why you have to check out today’s podcast:
- Find out how to be a great pricing professional with pricing leadership
- Learn about the pricing education Professional Pricing Society provides for someone in terms of forging a pricing career path
- Hear about the future of pricing considering the uncertainty that concerns us at this time
“Everything in your company, all the profitability, all of your salaries, all of your bosses' salaries, every Dollar, Yen, Euro, Won that comes into your organization has a pricing decision attached to it.”
- Kevin Mitchell
Topics Covered:
01:49 - What made Kevin start a Pricing career
04:54 - Professional Pricing Society being a subscription company
06:19 - Who joins the Professional Pricing Society
08:09 - What is a pricing professional
11:22 - Two things that a company does in terms of R&D, product development, marketing
15:56 - How does PPS does education on pricing leadership
18:06 - Thoughts on the pricing landscape COVID and post COVID
25:19 - Changing names but keeping the value
26:43 - Best pricing advice that could impact your business
Key Takeaways:
“For a lot of individuals, pricing people, it's our job to make sure that we keep the lights on and keep everything running. And we do that because a lot of people invest a lot of resources in creating whatever it is that our company does, it's our job to make sure that we are adequately compensated for that.” - Kevin Mitchell
“The price is often the first impactful thing about a product or service. And it is our job to manage that.” - Kevin Mitchell
“To be a great pricing professional, you have to be an artist and also a scientist at certain levels. Certainly, you do need the mathematical, data, analysis background. But I think sometimes we can be lacking in communication, on the negotiation with others inside and outside of our company. I think both are very, very important about what we're trying to get across.” - Kevin Mitchell
“All of the money that comes into any organization, and therefore all of our salaries, all of the benefits that we get, that's all tied to a pricing decision at one point, and it's just a matter of, are we going to have our influence in it or are we going to let the marketplace decide?” - Kevin Mitchell
“It's so important that we should all be in the mind-frame that we're going to learn as much about it as we can to make the best decisions for ourselves, for our companies, and for all of the people in our organizations who work so hard to create the value in the products and services that we deliver to the marketplace.” - Kevin Mitchell
People/ Resources mentioned:
- Ford
- Xerox
- IBM
- Tom Nagel
- Reed Holden
- Eric Mitchell
Connect with Kevin Mitchell:
- pricingsociety.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Brooks Hamilton is the Vice President of Services at Zilliant. He is responsible for Services sales, the technical team, engagement methodology, partner enablement, and training across multiple countries as well as assist building Zilliant's brand via industry speaking engagements. Zilliant is a global company with blue-chip customers around the world.
In this episode, Brooks shares how tariffs can make changes on your cost basis and impact your company’s bottom line. That’s why companies who respond quickly in their pricing and have a better understanding of their pricing and tools fare better than those who are not. He also talks about price modes and how clarity and knowledge about it can turn more revenues for your company.
Why you have to check out today’s podcast:
- Find out why you should care about tariff pricing and what you can do to protect your company’s bottom line
- Learn and understand pricing mode to turn more profit dollars for your company
- Understand how pricing culture affects the usage of pricing mode to effect changes in price the best way possible
“Pricing clarity to understand the different mechanisms, to understand who owns them, and the decision-making process that's behind them. So that each level of that process is solving the approach in the best way possible.”
- Brooks Hamilton
Topics Covered:
01:37 - How Brooks’ career in Pricing started
03:32 - What is a tariff
05:03 - How tariffs impact cost basis and a company’s revenue
06:03 - Important questions you ask yourself when faced with a tariff concern
07:55 - Contributing factors that can help in the decision to increase price brought about by a tariff
09:15 - Why Zilliant cares about tariff pricing
10:35 - What plagues organizations of all sizes
10:57 - What are a price mode and the mechanisms that go with it
12:04 - What is a great aspect of a price mode for a pricing organization
14:59 - How to use price modes to
16:35 - How the number of price modes used depends on pricing culture
17:17 - Taking a look at an organization’s pricing culture to see how it affects the usage of price modes
19:09 - What is considered as one mode and a price envelope
19:41 - The challenge we see in organizations when it comes to price modes
21:01 - What are the things we need to know for any given price mode
22:05 - Who has the authorization to make the change
23:52 - Understanding price mode and getting into a mode shift
26:43 - Brooks’ best pricing advice that greatly impacts your business
Key Takeaways:
“You may be able to provide some air cover, some pricing air cover for you and the competitor. But that's largely going to be based upon whether or not you are a price leader or perceived price follower in the market. And it may also be one where a competitor is poised to make a bit of a move during that time to try to gain additional market share.” - Brooks Hamilton
“We know that those customers who can or organizations who can respond quickly, who both have an understanding of their pricing as well as tools to rapidly change their pricing are going to fare better in an environment where tariffs are changing quickly as opposed to those where they're not able to move as nimbly.” - Brooks Hamilton
“So, when we engage with a customer, the one thing we want to make sure we do is we establish a common understanding of the mechanisms that a customer uses to price. So, what I mean by a mechanism is having a product price that's available to all reference or downstream prices.” - Brooks Hamilton
“I think a great aspect of a price mode for a pricing organization is to first have a really clear understanding of what are the price modes that we use, how much of my revenue do I have going through these various price modes, and then really importantly, who makes the decisions behind the prices for each of those modes.” - Brooks Hamilton
“Every organization has price modes, whether they recognize them or not. And the more common challenge that we see is organizations having great clarity behind the price modes that they use in the role that they play, and having a really good understanding of how they make decisions around them, what portion of their business is associated with it, and which tools they use to inform those decisions, as opposed to the exact setup and structure of those modes themselves.” - Brooks Hamilton
Connect with Brooks Hamilton:
- Email: hamilton@zilliant.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Axel Kirstetter is a global and multilingual technology executive with start-up and large-cap experience for companies achieving accelerated growth targets, category leadership, and successful exits (Datasite, COLT, TomTom, Intralinks). He has been in the cloud space since 2000, subscription economy since 2003, SaaS sector since 2006, and tackling product-led growth since 2017.
In this episode, Axel shares how you start from a transaction nature of a product, then find your best market fit, work around what pricing is relevant to support it. Eventually, you look at the genuine subscription model that best gives you the chance to achieve your revenue objectives.
Why you have to check out today’s podcast:
- Find out how to build a business so you can get subscription revenue and, more than that, finds opportunities for upselling and cross-selling
- Find out which subscription revenue model is best to go after considering the growth rate mode at which you are at the moment
- Learn how to combine the subscription revenue model with the consumption-based notion to achieve revenue objectives better
“Keep optimizing, keep iterating; it's never done. Don't overthink the quantitative elements because you do have the possibility nowadays to quickly and rapidly adjust once you are in market. So really keep optimizing, keep working away at what the price point is.”
- Axel Kirstetter
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:24 - How he became so good at all issues around pricing and started a career at it
02:26 - How does he define his title as Content Marketing and Pricing VP?
03:51 - Product people talk about Pricing but don't really understand in the detail level what Pricing does
05:17 - A degree of maturity and sophistication as to how you do pricing discovery and value discovery
07:06 - Axel’s thoughts about a subscription
09:17 - Taking a look at Salesforce subscription pricing
10:02 - What do most associate 3.0 with?
11:07 - What is 4.0?
13:46 - The difference among consumption, subscription, and recurring revenue
16:49 - Are Coke and Uber a recurring revenue model?
22:24 - Combining subscription with consumption notion
24:57 - Which one to use: subscription business model or recurring revenue business model
25:55 - Axel’s perspectives on these three revenue buckets of winning customers, keeping customers, and growing customers
28:23 - Which one to focus on: going after recurring revenue or asking what’s the right business model
Key Takeaways:
“There has to be a degree of maturity and sophistication as to how you do pricing discovery and really value discovery. And that takes understanding the sort of product-market fit; it requires a bit of understanding of how your salespeople would negotiate.” - Axel Kirstetter
“A company is willing to be very clever about a subscription versus a consumption mode. I think being online is fantastic because it makes you findable that you don't have to gravitate towards the notion of you know, subscribe to over 12 months, when all you do is you need it at certain peak times at certain convenience levels.” - Axel Kirstetter
“We need to think beyond just the gold-silver-bronze approach. Because it's more than just a subscription. It's more than just sort of meeting the needs of investors; you have to meet the needs of the end consumer.” - Axel Kirstetter
“Subscription has varied flavors to them. Think which type of subscription model works for the client circumstance.” - Axel Kirstetter
Resources Mentioned:
- Salesforce
- Starbucks
- Panera
- Pret
- Uber
- Coke
- Harry’s Razor
- Zappos
- Amazon
Connect with Axel Kirstetter:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Chris Barth is currently the Vice-President of Pricing at Pitney Bowes Commerce Services. He used to be the Vice President of Finance Operations at Newgistics.
In this episode, Chris talks about how to sell on value, matching the markets’ needs with a solution and tying it up with an appropriate and justifiable price.
Why you have to check out today’s podcast:
- Learn how to bring salespeople to sell on value and at price points that make sense in the market
- Find out how to articulate value and translate it to price
- Find out a commission algorithm that makes salespeople earn more when selling on value but earns lower when selling below the target price
“Really understanding what you're trying to do as a business has many functions of what they're working on, what's on their roadmap. And ultimately, how is that translating into the pricing and that story that you're trying to communicate to your customers through your sales team.”
- Chris Barth
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:18 - How his pricing career started with Dell
03:05 - What does special pricing mean?
03:39 - What contributed to his status as VP of Pricing
06:14 - Matching up value with price
08:00 - The time in his career when he pivoted his thinking on pricing and considering the value components
12:14 - The challenges of making salespeople sell on value instead of price
15:34 - Putting yourself in your customers’ shoes when trying to set up price
17:47 - Structuring commission plans for salespeople to sell on value rather than just giving discounts
21:48 - Coming up with an algorithm that incentivizes bigger commission those that sell on the sweet spot and higher
24:51 - Chris’ best pricing advice that has a great impact on your business
Key Takeaways:
“You're always thinking about how can I hold the line on price. It's really trying to match what are the needs of the customers with the solution that you're offering and what is the appropriate price?” - Chris Barth
“We didn't have this grand network; we didn't have assets. And here, we had to sell value and convince retailers to pay for our solution. And then, in turn, we had to coach our customers on how to position it with their consumers.” - Chris Barth
“All the things that go into what you're trying to do as a business have got to translate into your positioning in the market and what you're trying to do. So, when I say that, it’s just understanding your business strategy.” - Chris Barth
“When you're trying to set value, then, put yourself in the customer's shoes. Would you buy this product? Would you pay for the solution? What need or problem are you trying to solve in the market? And what is it worth?” - Chris Barth
“What you want are sales folks, really being able to articulate the value, matching that value to a customer's needs and being able to capture the highest possible price that can tie to the value and optimizing your profit as a company.” - Chris Barth
Resources / People Mentioned:
- Freakonomics: A Rogue Economist Explores the Hidden Side of Everything by Steven D. Levitt
Connect with Chris Barth:
- E: fastercall@gmail.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Stephan Liozu is the Chief Value Officer at Thales. His expertise includes Customer value modeling, value proposition design & value-based pricing, Business model innovation & differentiation strategies, Creative & disruptive innovation strategies, Change management & leadership training.
In this episode, Stephan shares how important it is for C-suite to be more than just focusing on the usual aspects of cost improvements, acquisitions, and cash flow management. There is a need for them to educate themselves in the pricing profession on how pricing can help them drive profitability, improve customer experience and satisfaction.
Why you have to check out today’s podcast:
- Find out the need to convince the C-suite why understanding pricing is important
- Find out what the important objectives of the book are, ‘From the Profession to the C-Suite’
- Find out the soft skill courses you have to invest yourself in to become a better leader
"Invest in yourself, learn some of the soft skills, get a better-rounded person, and in 2021 invest in training in your soft skills, and I think that will help you for the rest of your career to become a better leader."
- Stephan Liozu
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:40 - What the C-suite has not done in the pricing profession
03:22 - What do C-suite pay attention to that they keep from wanting to do pricing
04:32 - Is thinking about cost a more tactical thing than pricing
06:28 - What’s missing in the C-suite when it comes to wanting to do pricing
07:53 - What’s behind pricing person not able to educate or inform a CEO in the organization
10:11 - What’s this book all about and what’s its purpose: ‘From the Profession to the C-Suite’
13:15 - What are the objectives of the book
15:53 - Much more on the value side much less on the pricing side
17:34 - What does work look like for Directors and VPs of Pricing
19:23 - What the leadership side of Pricing entails
20:34 - A chapter in a book dealing with strategic capabilities
21:30 - His personal mission for having the book
22:44 - What success for a company mean
23:16 - Stephan’s best pricing advice that will significantly impact your business
23:42 - Different courses you can invest in for soft skill improvement
Key Takeaways:
“We have to take the responsibility as a profession, not organizing ourselves enough, not publishing enough as a profession, not educating the C-suite enough. And I think we got to get to the point where we do it.” - Stephan Liozu
“The first objective of the book is to really show them the impact. Once and for all let's put that discussion to rest. So, there is going to be lots of chapters on impact, showing case studies showing statistics.” - Stephan Liozu
“The second purpose is really to address the myth and the lack of understanding. So, we have papers around, you know, what pricing is now, especially post-COVID. You know, what it can do for you, why do you need it?” - Stephan Liozu
“We're going to talk about the third objective and to show them what capabilities do you need to really do good pricing projects.” - Stephan Liozu
“I'm trying to convince a lot of the pricing people to invest in themselves and develop these soft skills and be able to tell stories and be able to understand the social fabric of their organization, who knows, well, this is kind of a sixth sense that we need to have.” - Stephan Liozu
“It's a question of us as a profession to send books up to the C-suite for them to read it. And then more than that, it's going to be difficult to do. But it will be, for me an objective that I always wanted to do. As you know, you and I are evangelists; we push pricing day in, day out. And I think we need as a profession to promote ourselves better and to start coordinating the messages that we have.” - Stephan Liozu
“Frankly, either we do nothing, or we try our best to do something and influence. And for us, it's not like it's going to change our life as far as income is concerned; my interest is really to get pricing much more on the radar and much more adopted, like other functions, like supply chain analytics these days. And it is a mission for me, I took it as a personal mission to really educate and get into the C-suite to make a difference.” - Stephan Liozu
Resources / People Mentioned:
- Kevin Mitchell
Connect with Stephan Liozu:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Alon Ellis is a partner at Deloitte Monitor. He is leading Deloitte Australia’s Pricing Strategy & Margin Management capability
In this episode, Alon shares how he believes it is value-based pricing but understands what value means not from your perspective but on customers’. He talks about not giving everything away to the customer as you are in the business of providing a service or a product, and you have to be profitable.
Why you have to check out today’s podcast:
- Learn how to sell on value and what that actually means not from your point of view but from the customer’s point of view
- Learn how to communicate simply and straightforwardly your value and the pricing strategy that aligns with it
- Understand the economic analysis in every pricing decision
“Make it easy. And this is the hardest thing in pricing. Let’s assume that you’re entirely on board with value-based pricing and you’re thinking about getting the consistency and all that kind of stuff. The simpler you can make your pricing without losing big valuables, the better.”
– Alon Ellis
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:18 – How Alon’s curiosity led him to a career in Pricing
02:36 – How he went from industry to consulting to industry to consulting
06:57 – What is pricing consistency
08:58 – Having an economic analysis in every pricing decision
13:20 – Analytics versus value
15:41 – What is economic value estimation
17:23 – The difficulty when customers don’t care about the features and benefits you make
18:58 – Factors you can’t reduce to purely analytical process
20:21- How Australia and the US differ in terms of companies not understanding their product’s value
21:31 – Why salespeople need to be confident in communicating to the consumers that price is fair and reasonable
25:39 – How do the market perceive discounts
26:48 – Alon’s pricing advice that would greatly impact your business
Key Takeaways:
“Sometimes I get to kind of almost the extreme customer advocacy. So, everything is about us giving away stuff to the customer, or the other extreme, you know that trying to screw over the customer. And that’s never going to create a long-lasting relationship. You need them to be somewhere in the middle.” – Alon Ellis
“We always need to sell on value, but we need to make certain we understand what that actually means not from our point of view but from the customer’s point of view.” – Alon Ellis
“I believe it’s always value-based pricing as the number one way but they actually have to understand what value means from the customer’s point.” – Alon Ellis
“There’s nothing worse than a client who’s invested lots and lots of money into features that they think should have some value. But you’ve actually done this while you figured out that no one really cares.” – Alon Ellis
“This is where the psychology, the real world comes in. And that’s where, I think you can’t reduce this into a purely analytical process.” – Alon Ellis
Resources / People Mentioned:
- LexisNexis
Connect with Alon Ellis:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Brian Sharp is an Innovative Sales, Marketing & Pricing leader with a track record of driving step-change improvement in the enterprise’s financials through institutionalization of value-led disciplines. His expertise is integrating pricing and value disciplines across Sales, Marketing, Innovation, Supply Chain, Technology and Finance functions in large or complex organizations.
In this episode, Brian talks about value over cost and contract packaging pricing in the petrochemical and personal care industries. He shares how Velo provides service that prepares you for negotiation readiness and places you on the advantage against other negotiators.
Why you have to check out today’s podcast:
- Learn and understand negotiation readiness as a process to save you worth millions of dollars
- Find out why companies need the best relationship managers more than the best negotiators
- Learn how you price value over cost
“What we find consistently is less than 4% of customers almost always drive more than 64% of margins and revenues. And if you really want to change pricing in your business, figure out how to impact that concentrated mix and those monumental episodic negotiations.”
- Brian Sharp
Topics Covered:
01:16 - How Brian’s Pricing career started
02:23 - Why does he stay in pricing and why he shuns the pricing title
04:05 - How people define pricing
05:22 - What is a rise-fall mechanism in pricing
06:33 - Thinking in terms of value over cost in the petrochemical industry
07:43 - Pricing in contract packaging
08:46 - How businesses in commodities are invested in the value chain
10:16 - How incumbent transactional relationships are often shaped by context
13:01 - Understanding negotiation readiness as a process
15:57 - Effective relationship managers versus savvy negotiators
21:00 - Why wouldn't we go sell to the committee, and then pass the negotiations off to procurement
22:44 - Why process beats individual skill in large complex transactions
24:31 - The training you do when you purchase the Velo software
26:23 - How the Velo service works a deal from the minute the clients engage them
Key Takeaways:
“The way to think about it [petrochemical pricing] is its value over cost. So, it's easy to sell, it's cost-plus pricing. But really that base price, especially the base price, at the beginning of the contract period, is where value pricing manifests itself in these kinds of deals.” - Brian Sharp
“One of the things that we do in Velo is, we deliver an outcome that is driven by negotiation readiness as a process and part of that process is telling our clients, and in many cases, pulling our clients executives out of the foxhole, we're getting them off the front line.” - Brian Sharp
“Many companies have their best relationship managers, not their best negotiators. Because they're managing three- and four-year relationship cycles against the contract.” - Brian Sharp
“In large complex transactions, process beats individual skill, and it's not even close. There are several irrefutable fact basis. And what does that say? It says preparation, and structured process to get ready. The negotiator that's better prepared is going to win.” - Brian Sharp
“Our Velo service is, from the first minute our client engages us we're working a deal. There's a name, we're looking at stakeholder, who are the stakeholders who's going to be in the room.” - Brian Sharp
Resources / People Mentioned:
- Vendavo
- Pricefx
- Zilliant
- A.T. Kearney
- Castor Oil Lubricants
Connect with Brian Sharp:
- E: brian.sharp@profitvelocity.com
- hellovelo.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Zen Ore, a.k.a. “that pricing guy”, is a respected consultant who helped business across Australia, UK, USA, and Israel. Zen’s background is in procurement, negotiations, and deal structure, which gave him quite the reputation with pricing teams he opposed in negotiations.
After years in operations management roles, he specialized in analytics and BI, leveraging his statistics-rich engineering degree. Zen constantly volunteers to support small business and young entrepreneurs.
In this episode, Zen shares how pricing is not about how much you invested now but the value you deliver. He also highlights that pricing is not something you do at the end just before the product launch; it’s something you do even before you design a product. He touched on Wine Pricing and what influences buyers’ purchasing decisions with spirit products. He made mention on the psychology of pricing in this regard. Other than that, he gives his thoughts on how pricing works in the petrol industry; the pricing metrics used to gauge buyers’ willingness to pay.
[powerpress]
Why you have to check out today’s podcast:
- Learn about wine pricing and how its price is a strong indicator of the product’s quality and influences the ‘what’ and ‘how’ of buyers’ purchasing decisions
- Find out how petrol pricing works where an increase or decrease in the world’s oil price movement is concerned
- Find out why ‘pricing is a thing’ in your business
“Making sure your initial pricing doesn't damage your brand and addresses more than one market segment. I think that's the most common mistake I see with small businesses.”
- Zen Ore
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:35 - How an impactful event in his life got him started in Pricing
03:27 - How do consumers base their purchase decision on when it comes to wine pricing
04:39 - Why Pricing is a thing
05:50 - How Petrol Pricing works
09:48 - Why gas price goes up the same time oil price goes up for the day even if lead time for the oil production takes days for it to be brought to the station
12:28 - How everyone else raises prices without collusion once world oil price goes up
12:43 - When do oil companies make a better margin
13:37 - Getting out of a price war
14:25 - How Zen’s Jewish-Buddhist background made him put a pro-bono tab on his pricing website
17:36 - Zen’s testimonial about Mark’s online courses
19:38 - The need to understand the mental toolkit for Pricing
Key Takeaways:
“They don't understand that pricing is a thing. It's not something you do at the end, occasionally, five minutes before you launch into the market. It's something you have to think about way before you even start designing your service or product.” - Zen Ore
“There's a lot of costing involved because that's a factory, making wine is the factory, but the way pricing works, I think even without calling it by that name, it's more psychological than one might think.” - Zen Ore
“We started playing with the metrics [petrol pricing], and we realized that yes, sometimes you can raise the price. As long as you raise another metric or another value driver, they will keep buying and you will maintain the same volume with the higher price. And I think that's the business you want to have.” - Zen Ore
“[On his website’s pro bono tab] It's me, showing that I believe in what I do, and I believe in what I understand about how people pay. You can pay as much as you want. And I'm not going to criticize you for this. And experience shows that's actually not a bad financial decision on my end as well.” - Zen Ore
“Once you get accustomed to that kind of strategic thinking, it's in your mental toolbox. And I think it's the same with your courses. So, it doesn't matter if you're pricing petrol or you're pricing fast-moving consumer goods or anything. You understand the mental toolkit for pricing. And I think that's priceless.” - Zen Ore
Connect with Zen Ore:
- pricingisathing.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Maciej Kraus is an experienced strategy executive with a broad operational background. He specializes in pricing and sales excellence in B2B, B2C, and retail markets. He worked both for leading multinationals as well as SMEs. He is also a guest lecturer at Stanford and LBS and an author of 2 books on Sales, Strategy, and Pricing. He is also an acknowledged sales coach and trainer, a certified business coach at the same time a TED speaker.
In this episode, Maciej shares how companies should think more than monetization of their product and go after customer retention. He underscores how Pricing validates product-market price fit. As with SaaS Pricing, he points out that it is not about building cool marketing around the product but creating an intrinsic value in the product itself. He shares how one should not be scared to raise prices because for as long as you are winning your deals your price is not high enough.
Why you have to check out today’s podcast:
- Learn to understand how Pricing is the best validation for your product-market price fit and why you should not feel scared to raise your prices
-
Find out why you should come from a mindset of not just acquiring but also keeping customers
-
Find out what Pricing strategy you need to put in place now so that when COVID is over you are prepared that you only have to access and launch it right there and then
“Raise your price by 5% increments. And just wait until you have 20% of your customers leaving you. And then it means that you got to the optimal price.”
- Maciej Kraus
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:11 - How Maciej got started in Pricing
01:36 - What got him stuck in Pricing
02:02 - Emphasizing Pricing on the webpage
03:14 - Pricing as a validation for your product-market fit
03:32 - Not just a product-market fit but product market price fit
03:57 - How do startups think of Pricing
05:02 - Agreeing to what Stiving Value Table stands for
05:12 - How does SaaS Pricing excite him
06:10 - The intrinsic value you need to build in SaaS products
07:42 - Mistakes that a lot of subscription businesses make
12:26 - Understanding the value you deliver in a subscription business
14:42 - What should you prepare and what pricing strategy should you need to roll out once COVID ends
16:29 - His best pricing advice that can impact your business
17:13 - The best test if you get Pricing or not
18:10 - How to get your optimal price
18:29 - Why you should raise your prices
Key Takeaways:
“For me, Pricing is the best validation for your product-market fit. If you have to give away your product for free, what is it worth?” - Maciej Kraus
“We both agree that you should quite often start with your Pricing, and then build a product around it.” - Maciej Kraus
“I think what I really love about SaaS is that it's not that you sell and forget, which quite often happens with just any other product. You have to build the value on the ground when you have a relationship with your customer.” - Maciej Kraus
“I see quite often with the SaaS businesses they have this product kind of mindset; you just have to acquire customers. And this is the only thing you have to do. But actually, where the money for the SaaS model comes from is from that monetization and the retention.” - Maciej Kraus
“When you are overwhelmed with those different options that you cannot see the difference, then probably most customers will say, my old car is still okay, so I don't need a new one.” - Maciej Kraus
“And this is where I spent quite some time these days working with companies on how to think about what should be our pricing strategy when the reality changes so that we are prepared and we just can press the button and launch it.” - Maciej Kraus
“It's easier to lower price than to increase it. That's why it's always better to start a bit too high than a bit too low.” - Maciej Kraus
“Keep raising by 5%. Because what you hear is that 'Okay, so I listened or I read a marketing book, I raised my prices and guess what -- none of my customers left me. Usually, the answer is, so probably you still have a lot of room for price increases.” - Maciej Kraus
Resources / People Mentioned:
-
Marc Andreessen
-
Kyle Poyar
Connect with Maciej Kraus:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Chris Hopf is a Trusted and Respected Monetization + Pricing Strategy Consultant to Innovative Software and Technology Market Leaders. He helps innovative software and technology companies of all sizes create, recognize and capitalize on opportunities to achieve their full market potential - every day - every transaction. For more than twenty-five years, he has worked as an owner, employee, and as a consultant with small startups, mid-sized mergers, and Fortune 50 Corporations such as Microsoft and United Technologies.
In this episode, Chris shares why companies should know how to communicate their value as there is always pressure to reduce price. In this regard, they need to stand up for their value. He also talks about how companies must understand the distinction of strengths, advantages, and alternatives, so they won’t be missing opportunities to be always relevant to their customers.
[powerpress]
Why you have to check out today’s podcast:
- Discover the ‘Ten Steps to Scalable and Recurring Revenue’ and see where you can work on your strengths and advantages to always put you in a better and unique position against your competitors
- Find out how to always reinforce the value you are delivering to your customers so they won’t take it for granted, and so you always create value and not destroy it
- Learn how to prioritize your efforts in terms of acquiring customers so you are spending time well focusing on being relevant
“Give your pricing a chance. And part of that is making sure that you're taking a really honest look at what your advantages are, and honest look at what your advantages will be in the future. And making sure that you're giving those advantages the best chance.”
- Chris Hopf
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:36 - The different ways Chris works with companies
03:09 - How he got involved in Pricing by chance
04:09 - His main reason for staying with Pricing all these years
05:29 - What is ‘The Revenue Due Diligence: The Ten Steps to Scalable and Recurring Revenue’ all about
06:29 - Why would someone pay?
08:32 - Who is willing to pay -- what ‘The Pricing Window’ visual is all about
09:27 - How can you influence the ability to pay
10:37 - Why is it important to understand who your customers are and prioritize your efforts
11:48 - When are they most likely to pay -- understanding the ‘buyers’ journey’
13:10 - How seasonality’s affect how companies buy
15:28 - How will they know about you -- how is it best for people to know about the value and the advantages that you deliver to your customers
16:36 - Why is it that in the ten steps mentioned, in no way does it ask how much should we charge
17:04 - Why choose you now -- what are your advantages
18:13 - What is the key to creating a sense of urgency
20:01 - Pricing problem versus value messaging opportunity
21:27 - Why do companies sometimes don't do a very good job of communicating their advantages
22:15 - Distinction between advantage and a strength
23:09 - Why keep choosing you, and why pay more from you?
23:28 - Why tell others about you?
24:27 - Why stop choosing you?
25:43 - Why always highlight to your customers the value you are delivering to them
27:05 - Chris’ best pricing advice that will impact your business
27:41 - Stand up for your value
Key Takeaways:
“One way you can influence the ability to pay or possibly drive or increase the ability to pay is if you think of your solution and the people within the organization that are impacted the value that is received.” - Chris Hopf
“Companies don't think through these in a very organized and deliberate way. And they can spend a lot of time focusing on being relevant, and acquiring customers that really are and should be considered distractions, maybe distractions for now, and maybe not in the future. But it really is important to prioritize your efforts.” - Chris Hopf
“For some companies, there's seasonality to how they buy, and this isn't only their initial purchase, their initial decision to do business with you, but what are they most likely to pay to expand with you?” - Chris Hopf
“What I found is sometimes people do a relatively good job, some better than others around understanding their advantages. But they don't go to that next step around, 'Why now?'. What are you going to do to compel action?” - Chris Hopf
“What's key to creating a sense of urgency is creating a sense of opportunity, you create that sense of opportunity, and you frame that well in their minds in terms that they understand and relate to their business and the outcomes they care about. And then that's how you're going to create that sense of urgency. But what's key is that it needs to be directed back at your solution over other alternatives.” - Chris Hopf
“People actually don't spend much time understanding with clarity an honest assessment of their advantages over alternatives.” - Chris Hopf
“A lot of times when people reach out to somebody like me, is they think they have a pricing problem. And oftentimes, they actually just have a value messaging opportunity, right. So, they aren't doing a very good job of not only communicating their value that will resonate with their prospects and customers, but they don't do a very good job of communicating their advantages.”
Connect with Chris Hopf:
- pricingwire.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Love Sanoria is the Director of Operations at ChargePoint. He is also a Professionally Qualified Senior Finance business partner adept at increasing profitability, having significant all-round corporate experience of 16+ years in Finance & Accounts domain. He is a subject matter expert in creating processes for driving financial forecast & annual budget for the organization in collaboration with multiple teams.
In this episode, Love talks about what IT pricing is all about, though it may be based on what the costs are but it is never about not putting concern over quality first for as to him quality never comes cheap. He points the fact on how a company’s IT landscape determines its subscription need. He also shares how COVID will increase pricing due to expenses and losses incurred by companies at this time of the pandemic.
Why you have to check out today’s podcast:
- Learn how to charge your product based on the level of differentiation, how better your product is from your competition
- Learn what is COVID pricing and how it affects future pricing
- Understand how IT pricing is arrived at
“If you understand the business, then pricing is a derivative of that. So, if you understand what are the cost elements to it, you will be able to do the pricing.”
- Love Sanoria
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:00 - What made Love consider Pricing
01:54 - How does Revenue Assurance differ from Pricing
03:38 - Looking at cash and revenue from the accounting standpoint
04:44 - Does it happen that transaction in million dollars not paid
05:08 - What is IT pricing
08:55 - His thoughts on pricing based on customers’ willingness to pay and not about the cost
11:39 - Quality never come cheap
13:54 - How a company’s IT landscape determines subscription needs of companies
15:30 - How people wouldn’t mind spending something just to keep things as it is
17:00 - How has COVID hurt the IT industry and how it affects future pricing
18:20 - How prices are going higher not because of consumer’s willingness to pay but because companies expenses have gone up
Key Takeaways:
“I would say pricing comes... might be at a second, third level, but quality comes at first but given the transparency of the process in the big companies, it adds a weightage to your overall budget from the customer perspective.” - Love Sanoria
“Think from a vendor perspective, no one wants to lose a deal from high price perspective, given the very competitive scenario.” - Love Sanoria
“There are different vendors. And if you talk about vendor, they have different cost strategies as well. They have different quality. But if a customer wants to choose the high quality, they have to pay the high price, quality never comes cheap.” - Love Sanoria
“COVID has hurt, I would say, the IT industry, generally a lot. Obviously, they have their margin pressure, they have cost pressure, it will bounce back, once it bounced back, they will obviously charge back from their customer.” - Love Sanoria
Connect with Love Sanoria:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Andrew Butt is a Co-founder & CEO of a Silicon Valley venture-backed SaaS platform called Enable, which deals with rebate management. He has been a director of several other companies and not-for-profits. He has started and grown multiple businesses into profit and positive cash flow, including exit to PE.
In this episode, Andrew talks about using rebates to incentivize distributors to meet the goals manufacturers have in mind. He shares how manufacturers create different rebate programs with various supply chains to work closely together to provide consumers better service.
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Why you have to check out today’s podcast:
- Find out how Enable can help manufacturers deal with data flow complexities and execute well the rebate programs for the different supply chains involved
- Understand why you should go for rebates rather than discounts in a B2B setup
- Find out how rebates provide a symbiotic relationship among the supply chain in the B2B sector
“Definitely have some kind of rebate incentives in place because I do genuinely believe that they can drive that behavior in a way that a pure price on its own can't do. That, I think even with rebates, keep it simple, make it clear to customers what they need to do and what benefits they can get.”
- Andrew Butt
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:12 - How Andrew found his path to a Pricing career
02:06 - What kind of rebate is Andrew talking about
02:34 - How different is a B2B rebate from a consumer-type rebate
03:32 - Talking about rebate’s bad reputation with B2C
04:46 - Addressing rebates’ bad reputation in the B2B sector
05:40 - Why go for rebates than just discounts
07:15 - The need for data sharing between manufacturers and distributors
09:20 - How rebates work outside of the usual supply chains
10:09 - The disadvantage of manufacturers incentivizing end-customers directly
10:59 - What problem does Enable help to solve
13:31 - Automating transactions, especially where a rebate is concerned
14:22 - How Enable helps companies on what they are already doing in terms of rebate execution
15:47 - Helping companies realize the power of rebates
17:34 - How rebates can be very effective
19:02 - What is ‘ship and debit’
19:41 - Industries where he sees rebates successful aside from warehousing or distribution
21:40 - Why is hardware companies more likely to have rebates than software companies
22:37 - The most creative rebates he has seen
23:49 - Big drivers for creative behavior inside a channel
24:56 - Andrew’s best pricing advice that can greatly impact your business
Key Takeaways:
“I think rebates generally are all about driving behavior. And because they are claimed back retrospectively, you have to do something to collect the rebate. That's how it's designed to drive behavior.” - Andrew Butt
“Rebates are the currency of joint business partners that exist between trading partners. So, it's a lot more kind of ongoing than just a B2C type one-off rebate situation.” - Andrew Butt
“Rebates are not at all a bad thing like we might think about with some of those consumer nightmares. It really is about a genuine and very effective incentive program similar to what you might have with your own sales team.” - Andrew Butt
“We had many situations where manufacturers were not paying the rebate that was promised, not because they were trying to be malicious, but they just couldn't calculate it and couldn't work it out. You could have situations where distributors abused manufacturers and claimed too much more than what was due. And the whole idea that we've been talking through here, which is so powerful, was just not being executed well. Enable saw the opportunity to automate that with a SaaS software platform, which is exactly what we've done.” - Andrew Butt
“We really believe that in every trading relationship, any of the buying and selling relationships, there should be these intelligent kinds of deals, these incentive deals in place that can be kind of tracked on both sides using the same language, and then each party can be rewarded when they hit the goals.” - Andrew Butt
Connect with Andrew Butt:
- enable.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Florian Bauer is an internationally sought-after expert and speaker on the subject of price psychology and behavioral pricing. He is an honorary professor at the Technical University of Munich and author of several books on price research. He also has a doctorate in Psychology at TU Darmstadt, MIT, and Harvard.
In this episode, Florian talks about how discounts can give you short-term gain but cost you long-term. He underscores that there are other means to incentivize customers without diminishing a products’ value perception. And that, cashback is one thing to consider other than discounts. He also talks about buyers’ irrationalities and how to use Behavioral Economics to influence their decision-making and let it work in your favor.
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Why you have to check out today’s podcast:
- Learn about the psychology of price structure and how it influences consumers’ buying behavior
- Find out what you can, what you should, and what you should not do when giving a discount
- Learn how Behavioral Economics can help you influence buyers’ decision-making and maximize your company’s profit
“If you want to price or sell something, you have to think in two dimensions. You have to think about what people want. That's the traditional value-based approach. And you have to think in the dimension of how they decide.”
- Florian Bauer
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
00:37 - How Florian got started in Pricing
01:34 - What the psychology of price structure is all about
02:31 - What a price structure looks like
03:22 - What’s the psychology behind using cashback than just lowering the price
05:13 - How do discounts differ from cashback
06:51 - The feeling of disconnect with cashback
07:38 - Cashback being an icing on the cake that can potentially make you feel more decided about your choice
09:29 - What’s the disadvantage of discounting
11:09 - What behavioral economics means for pricing
16:04 - Different people behave differently when it comes to decision irrationalities
20:11 - His thoughts on the ethical issue about Behavioral Economics
23:44 - What is Behavioral Economics showing us and why this works in the B2B world
26:08 - How heuristics simplify complex decisions
30:23 - Florian’s best pricing advice that can significantly impact your business
Key Takeaways:
“Never ever give a discount without anything the customer has to give in return.” - Florian Bauer
“That's the issue with discounting. It really works very well short-term. So, you have to gain short term, but you have to cost long-term.” - Florian Bauer
“If I want to sell somebody something, I need to know what he wants, or she wants, and I need to adapt my sales approach and my pricing model, potentially, to how he decides.” - Florian Bauer
“For me, the purpose of marketing, pricing, and sales is to influence decisions. So, there is no reason to have a marketing campaign or a marketing team if you would not have the idea that I can influence my customers' decision in my favor.” - Florian Bauer
“I think when we talk about value and price acceptance, it's very much a story. And there is not one story better than another one. People hate to make decisions, they want to be made decided and with some stories, they are quicker in deciding than in others.” - Florian Bauer
“Think about that you're not only selling value; you’re also managing decisions. If you keep that in mind when you design your pricing model, you also avoid the traditional clash between pricing and sales because you're also able to tell your salespeople how they can actually execute your pricing strategy to make the customers actually follow the decision or the directions you want them to.” - Florian Bauer
Resources / People Mentioned:
- Daniel Kahneman
Connect with Florian Bauer:
- Email: bauer@vocatus.de
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Alessandro Monti is a pricing enthusiast and expert on all topics related to monetization, conversion, upselling, and digital pricing history. He’s an experienced consultant, advisor, mentor, and speaker in all fields related to price management, sales excellence, marketing, and corporate strategies.
He's also a dedicated professor and lecturer for Marketing, Pricing, Sales and Digital Transformation at the CBS International Business School in Cologne.
In this episode, Alessandro talks about the importance of learning the pricing basics, the fundamental pricing relationships that must be considered before pricing a product, and how a customer perceives a price ‘fair’.
[powerpress]
Why you have to check out today’s podcast:
- Learn why history is important in pricing, and the other fundamental factors to consider in coming up with a price
- Find out what the ‘Blackbox of pricing’ is all about and why not all people know about it
- Learn the importance of why as a pricing professional you need to live, breathe, and ace the basics first before you come up with pricing shortcuts and beta tests
“Learn the fundamentals. Understand the basic mechanisms. In the long run, this will yield you far better results than just the ‘easy and quick’ approach to pricing.”
- Alessandro Monti
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:06 - Alessandro’s first touchpoint into pricing, what made him stick to pricing - Price as the central hinges of the economy
03:05 - How did his Ph.D. in Business History help him in working at Simon Kucher & Partners?
05:29 - Alessandro and his coaching and consulting business, the kind of clients and businesses he typically coaches
06:52 - Why pricing is so easy in theory but not in real life? The complexities, the abstract, and the real deal
09:20 - Connecting the dots, the quantum parts of the decision making: future decisions that customers take
12:07 - ‘Unlocking the Blackbox of Pricing’: How to answer the ‘what should be the price’ question
16:17 - What is a fair price? How do you decide what fair means? The Fair Transaction the concept of fairness
20:04 - The Fairness Index - telling a reason for your price increase than telling nothing without spooking your customers
21:08 - The 10x approach of pricing Softwares as explained by Alessandro
23:09 - The hardware pricing /The digital ecosystem of hardware in the subscription businesses
24:09 - Alessandro’s pricing advice: “Try to understand the fundamentals. Don't try to hack yourself somehow through the price or go for some shortcuts. Understand the basic mechanisms and this will yield you far better results.”
25:10 - The fundamentals of pricing and the factors affecting it
Key Takeaways:
“Price is the central hinge of the economy.” - Alessandro Monti
“[on coming up with price] ...the discipline is so complex; it seems to be easy. But the complexity every time I start the lecture on elasticities, in the end, it's difficult because it's so abstract. Then you’ll realize, ‘Hey, this is real life. There is some reaction to price changes and in demand.” - Alessandro Monti
“The concept of fairness is so individual. At the end of the day, I'm a big fan of, ‘Hey, if I'm able to charge at the level of individual’s willingness to pay, and I deliver value, and the customer is willing to pay for that.” - Alessandro Monti
Connect with Alessandro Monti:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Ben Blaney has had broad pricing stints with companies like GE, Pros, Colfax, and Updegraff Group Realty. To date, he is with Vendavo taking the role of Vice President for Pre-Sales.
In this episode, Ben talks about how misunderstood, underserved, and undervalued channel selling or channel management is. He shares that unless you have a clear understanding of your value chain, only then you can price your channel partners. As this pandemic shaped how we need to look at the future, so has e-commerce posed an important issue on how we should think about whether it be considered a channel in itself.
Why you have to check out today’s podcast:
- Learn to understand the value a channel brings to you to help you price your channel partners
- Find out the force multiplier effect of your channel partners in your product distribution
- Learn how to make the value chain better for you, your distributor, and ultimately your end-customer
"On a whiteboard, on a piece of paper, draw all of your channels to market. How many steps are there on this value chain? How many possible different ways are there? Because until you know that, you can't possibly say how things should be priced into these different channel partners."
- Ben Blaney
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:11 - A funny story on how he started his pricing career
01:42 - Any transaction has already been priced
02:22 - What makes him love pricing
03:22 - Defining price
04:22 - What makes channel selling, channel management, and channel pricing underserved, misunderstood, and kind of undervalued
07:10 - What is a channel, and what are examples of it
09:51 - Seeing the important value distributors provide to manufacturers
11:26 - The force multiplier in the network of distributors
13:52 - Of commodity selling and delivered pricing
15:13 - Sell on Amazon or get distributors
18:42 - What the future of e-commerce would likely be
20:18 - What a distributor provides that an e-commerce platform could not
21:57 - The difference between distributor and brokerage
24:47 - What is going to distinguish the winners in channels from the losers
25:21 - Creating a unified price in the marketplace
27:36 - The essence of shifting from cost-plus pricing to value-based pricing
29:43 - The need for data cleansing
31:19 - Ben's best pricing advice that could impact your business
Key Takeaways:
"I kind of feel like the word price always needs a word before or after it because otherwise you can quickly become confused about what we're talking about." - Ben Blaney
"To understand the value a channel brings to you, say, manufacturer, that's the only thing that tells you how you should price to and through the channel." - Ben Blaney
"In commodity selling, you talk about a delivered price, meaning you are accommodating for the cost of transportation to the customer organization. These are important things; these are valuable to the end customer. And so, they're worth, the manufacturer, taking that margin out of their own pocket and put it in distributor because it's better for the value chain. You express better value for your customer." - Ben Blaney
"The moment that the distributor fails to understand that the distributor has this function to provide over and above what can be provided by the manufacturer, that's the moment of which they are obsoleting themselves as a step in the value chain." - Ben Blaney
"It's the focus, that relentless, obsessive focus on what the end-customer needs and wants, is going to distinguish the winners in channels from the losers." - Ben Blaney
Connect with Ben Blaney:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Rebecca Kalogeris is the Vice President of Marketing & Product Strategy at Pragmatic Institute. She has a contagious passion for telling brand stories and driving revenue. A true sales partner with the ability to quickly and effectively delve into markets and products, develop brand messaging, and build programs and teams that deliver results.
She has a proven track record of delivering rapid revenue growth - One of Kapost's "Top 50 Product Marketers to Follow" - Passionate builder of teams, processes and infrastructure to meet organizational goals. She is also host of a popular weekly product management and marketing podcast.
In this episode, Rebecca talks about the new Product Design course Pragmatic offers in partnership with the founding instructors of Cooper Education. She relates the importance of sales teams having the belief in the price so that they can be confident to go out there and win your price. She also highlights on who should own Pricing in the company as it relates to who creates value for people's willingness to buy.
Why you have to check out today’s podcast:
- Find out how and when to decide the price
- Learn about how deeply tied product management is to Pricing and see the depth of the connection and how powerful it can be
- Find out what you can do to affect customers' willingness to pay
"I would invest in more time…in explaining your price to sales."
- Rebecca Kalogeris
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:28 - How Rebecca got into Pricing accidentally
02:45 - Why she didn't get things right in the early part of her pricing career
05:11 - Pragmatic DNA - What's the problem
06:19 - Who should own Pricing
06:46 - Which particular department should Pricing reside in the company
08:03 - Why Product Management and Product Marketing should own Pricing
09:52 - Is Product Marketing a better place to put Pricing
10:55 - Her thoughts on product marketers being smarter than product managers
11:43 - Why does Pragmatic not incorporating good, better, best Pricing
16:16 - What Pragmatic is spending time on for a wider tool belt of items to create good, better, best Pricing
17:18 - Founding instructors from Cooper education partnering with Pragmatic for a Product Design Course
22:42 - Why product designers need to have a good understanding of the business in both the market and financial context
23:25 - When to decide what the price would be
24:32 - What to consider before building a solution
25:21 - What can any member of the company do to affect someone's willingness to pay
26:41 - Everyone in the company should create value and not destroy it
Key Takeaways:
"Once you start to talk to the rest of the organization about why that is how you price, it's a big learning curve for all those departments you interact with, but it makes you think about everything differently. At the end of the day, that's where the money comes in. And to be able to tie those things together, I think, excites everybody and also kind of coordinates everybody around the same north star." - Rebecca Kalogeris
"Product Management, Product Marketing, certainly we've seen Pricing and pricing strategists that come in more and more where it's an in-piece. I would not put that Pricing in Sales. And I would not put that Pricing in Finance. I think Finance is too far removed from the market, that's not their role. And Sales is too tied to individual customers versus the market to see some of those bigger trends." - Rebecca Kalogeris
"I think designers get a much better understanding of the market. But the other thing that designers need is a really good understanding of the business because sometimes they're isolated from that in a way that product isn't." - Rebecca Kalogeris
"I would say that you should decide what the price is going to be before you decide if you're actually going to build it." - Rebecca Kalogeris
"What can you do as any member of that company to affect someone's willingness to pay and I think I was just reading a big study about customer loyalty and satisfaction, and sort of how important that literally, the experience they have in the purchase process to the experience they have what they call customer service, all really affect someone's willingness to pay." - Rebecca Kalogeris
Resources / People Mentioned:
- The Inmates Are Running the Asylum: Why High-Tech Products Drive Us Crazy and How to Restore the Sanity by Alan Cooper
Connect with Rebecca Kalogeris:
- pragmaticinstitute.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jason Covitz is a VP of Pricing, Analytics, and Strategy at Safelite AutoGlass. His specialties include: P&L Management - CFO/CIO, Business & Risk Analysis, Value-Based Pricing, Sales Effectiveness, Product Management & Marketing, Business Strategy, and Data Analysis. And he has experience in a wide range of industries that includes Retail, Healthcare, Financial Services, Manufacturing, Online Services, Outsourcing, Telecommunications, Defense, and Strategic Consulting.
In this episode, Jason talks about how to measure value and how to get paid for value you give. As a business for profit your goal is not so much about increasing your market share as it is about growing your revenue.
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Why you have to check out today’s podcast:
- Learn how to make CFOs favor Value-Based Pricing more than Cost-Plus Pricing
- Find out one strategic action to encourage sales teams to communicate better a products’ value
- Learn how to turn sales conversations with sales teams to value conversations
“Number one is listen. Go around as you're joining an organization, go talk to everybody and listen to what their problems are. And then the second part is, go add value there. They're going to tell you where the problems are, and where the problems are it's usually where the money is. Go solve that problem, that's worth money to you and the organization.”
- Jason Covitz
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:32 - What brought Jason to Pricing
01:58 - What is his analytics work all about
02:57 - How his work in the competitive intelligence area relate to his being VP of Pricing
04:02 - How Pricing touch every part of the company
05:25 - How do CFOs look at Pricing
06:46 - How scared or excited are CFOs to get involve in Pricing
08:03 - How to get CFOs to think more about the Value Pricing and less of Cost-Plus Pricing
09:48 - Taking a look at the dispersion chart
13:18 - How to get around to stop the notion of Pricing people as ‘sales prevention’
15:39 - How to help the sales team sell value better
18:41 - Understanding the win rate and communicating it to sales teams
20:06 - Looking at win rate as true measure of whether pricing is doing well or not
21:35 - How win rates are often calculated
22:48 - What’s the right win rate
23:50 - How to tell when you’ve reached the right win rate
25:56 - What is a ‘Deal Desk’
27:47 - Why are ‘Deal Desk’ can be very transactional
30:16 - What percentage of deals should you be approving
31:34 - Seeing different approval rates by different people
32:29 - Pricing advice that helps impact your business
Key Takeaways:
“Once you understand what's going on in the market, what drives value, it's very easy to say, hey, I want to price it this way to win. And I want to win it, price it this way to maximize profit.” - Jason Covitz
“My experience with sales teams are 5, 10 percent of sales teams get the value story. My experience is usually, find a champion, find the sales guy who is the value seller and find out a way to call out his achievements. And I call positive peer pressure, 'Hey, look what Bob's doing. Bob just did this. And as a result, he made all this extra money.'” - Jason Covitz
“I think about pricing with a capital P, which means it should be doing price setting, it should be deal management, it should be doing the analytics, you know, if you're not doing all those pieces, as a price organization, you're missing your calling at every opportunity to drive impact.” - Jason Covitz
“You want to understand win rate and you want to communicate that to sales teams. And you can cut that in multiple different ways. It doesn't have to be an overall win rate. It can be by size segment, geo, salesperson, just to kind of you know, push it a little further.” - Jason Covitz
“Where you do interviews and go through the whole nine yards, people make decisions on four things, they make it on price, they make it on sales experience, they make it on operational experience, and they make it on product or solution capabilities. Those are the four, time and time again.” - Jason Covitz
“I look at win rate, as kind of one of my true measures of whether my pricing is doing well or not.” - Jason Covitz
Resources / People Mentioned:
- Manage for Profit, Not for Market Share: A Guide to Greater Profits in Highly Contested Markets by Hermann Simon
- Cardinal Health
Connect with Jason Covitz:
- E: jascovitz@gmail.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Natalie Louie is a Product Marketing strategist and leader who can build, scale, train and manage teams or roll up her sleeves to create and operationalize repeatable playbooks around positioning, messaging, go-to-market, product launches, customer journeys, training, competitive intelligence, win-loss analysis, customer and market research, sales enablement, pricing and packaging.
She is a strong operator and strategist adept at working with C-level executives, board members and cross-functional teams to ensure alignment and execution excellence for projects inside and outside of her scope. She loves telling a great story where the customer is the hero.
In this episode, Natalie talks about shifting pricing mindsets in the digital products space particularly under the subscription pricing model.
Why you have to check out today’s podcast:
- Learn how to introduce a new recurring revenue model into your pricing system without getting rid of your one-time transaction
- Learn how to make a win-win situation both for you and the client you are serving when introducing a recurring revenue model both for your hardware and software products
- Find out all about new product pricing in the introduction stage, how to set prices for the very first time
“Businesses are budgeting for how am I going to budget to unlock new growth going to a new normal, that COVID-19 brought out. And it’s all about making the right investments in your business so that you can adjust to new normal, which is all going to be in the digital space and digital world.”
– Natalie Louie
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:34 – Natalie talking about her new role at Zuora
02:07 – What does Zuora do
03:55 – How inconvenient doing your subscription manually can become
05:58 – Difference between manufacturing and software companies getting into recurring revenue
08:23 – What should you anchor your pricing on
10:05 – Replacing a one-time transaction with a recurring revenue model
14:07 – Introducing recurring revenue pricing slowly
15:00 – Talking about ancillary products and how does this work
18:03 – How to go about introducing new services you are not so sure about
19:27 – Narrowing your choices and finding out the best pricing strategy
22:03 – Mobility as a service in the car industry service
24:19 – Discussing hardware companies’ challenge with subscription pricing and overcoming it
25:57 – One big pricing advice she gives that can make a big impact on anyone’s business
Key Takeaways:
“Because they know what their product is, I’m selling my product, tell me the price point. And I have to switch the conversation to say, actually, it’s not about your price points. In fact, that’s the last thing that you figure out when it comes to switching to a recurring revenue model, you first have to think about what are you selling? What do they find value in?” – Natalie Louie
“Just because you’re ready, it doesn’t mean your buyers are ready. So, they have to be ready for a new model. And you have to show them right that you can deliver it and have those customer touchpoints, and then you’d be delighted. You need to make sure everyone’s on board. And that just takes time.” – Natalie Louie
“Software for free and charge for the hardware, but flip it the other way. Because that recurring relationship and payment for that software – that can go into pretty much infinity.” – Natalie Louie
“If you’re just introducing those new services, and you’re not even sure how you price it, or package it, or to use it, then give it for free, because the data you’re collecting is very useful. And so, while you’re giving it for free, you’re creating a direct relationship with your consumer for the very first time.” – Natalie Louie
“But the idea is if you build this long-term relationship with a lot of value, and you’re able to grow that customer lifetime value, in the long run, you’re going to win out and you’re going to have more revenue, and you’re going to keep growing.” – Natalie Louie
Resources / People Mentioned:
- Zuora
- My Fitbit
- Siemens
- Caterpillar
- Honeywell
- Adobe
- Ford
- Impact Pricing Podcast: Natalie Louie Episode #9
- Impact Pricing Podcast: Natalie Louie Episode #41
Connect with Natalie Louie:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Reed Holden is an author and keynote speaker for Negotiating with Backbone and Pricing with Confidence. Reed provides B2B pricing and negotiating advice to clients building go-to-market strategies to drive price leadership, selling backbone, and profitable growth.
Dr. Holden specializes in helping sales teams avoid the Procurement Buzz Saw by implementing strategies to recognize and counter margin-reducing buying tactics.
In this episode, Reed talks about how Pricing has changed in the last twenty years. With the new normal still to stay for some time, he advises to fundamentally change the way we communicate with our people and pursue our customers to have a sustainable relationship strategy. We need to adjust our prices to reflect that change in our business model. But at the same time, we have to accommodate the changes in the customer's needs.
[powerpress]
Why you have to check out today’s podcast:
- Find out the things to adopt and execute in your business to adjust to the new normal
- Learn how to execute prices better at this time and form strategic partnerships with your clients for a sustainable relationship
- Learn to recognize how the demand structure has changed in most industries so you can prepare your leadership team to think about using price to accomplish whatever objectives you have
“If I look at the biggest mistake companies make today, it is that they don't understand the customers. They don't understand how they use this stuff.”
- Reed Holden
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:19 - How he got started in Pricing
02:29 - How to stop losing price in the last mile of pricing
04:28 - What gives companies the ability to control price better these days
04:50 - Why you need to understand your pricing tools
07:36 - Understand your analytics
08:42 - Understanding surrogate value
09:41 - How demand structures in some industries are changing that you need to recognize
11:04 - What you need to do in the meantime that things are not going back to normal
12:45 - The reality of the whole retail industry out of the window now
14:04 - Pricing based on how customer value your product during this new normal
15:53 - Cost as a justification to raise prices
18:08 - His plans of retiring
21:10 - What does strategic partnership implies
21:15 - What a true picture of a strategic partnership is
23:07 - His thoughts on ‘charge customers with what they are willing to pay’
25:23 - Loyalty and segmentation
27:54 - His important pricing advice that has a great impact on one’s business
29:19 - Why you need to ask your customers
Key Takeaways:
“If people don't understand the software and the methods they're using, they encounter problems.” - Reed Holden
“You need to understand the tools, especially in today's world, how you have to change those tools to accommodate the new world.” - Reed Holden
“You got to recognize that the demand structure of that particular market has changed. The demand structure of restaurants, of movies, of the automobile industry, of many industries is changing dramatically.” - Reed Holden
“You have to understand how that demand structure is changing. And as a pricing person, you have to prepare your leadership team for not doing the stuff they did six months ago, but changing how they think about using price to accomplish whatever their objectives are.” - Reed Holden
“The whole retailing industry is out the window right now. They should have seen that coming 20 years ago when Amazon started making the push. And instead, they demanded, they pay the price now.” - Reed Holden
Resources / People Mentioned:
- Pricing with Confidence by Reed K. Holden
- The Strategy and Tactics of Pricing: A Guide to Profitable Decision-Making 2nd Edition by Reed K. Holden
- Negotiating with Backbone: Eight Sales Strategies to Defend Your Price and Value by Reed K. Holden
- Wall Street Journal
- Fortune Magazine
- JetBlue Airlines
- Southwest Airlines
- Bob Kaplan
- Thomas Nagle
Connect with Reed Holden:
- Holdenadvisors.com
- Email: holden@holdenadvisors.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Marco Bertini is a Professor of Marketing at Esade, co-founder of the school’s Institute for Data-Driven Decisions, and previously served as department chair. He completed his doctoral studies at Harvard Business School and was on the faculty at London Business School before moving back to Barcelona.
He is a co-author of the book "The Ends Game: How Smart Companies Stop Selling Products and Start Delivering Value," MIT Press, which explores how modern technology stimulates accountability, challenging organizations to succeed from the quality of the outcomes they deliver rather than the offerings they bring to market.
In this episode, Marco talks about how some firms are rewriting the rules of commerce by pursuing “ends” (meaning the actual outcomes) rather than the selling process. He also shares real-world examples of how companies in utility, healthcare, transportation, education, and other sectors are already playing “the ends game” model.
Why you have to check out today’s podcast:
- Discover and know about a Pricing model called pay-per-laugh and pay-per love
- Find out why you should be moving towards a performance pricing model in this day and age
- Learn why you should price for the ‘Ends’, not the ‘means’
“Prices speak very loud to customers, very, very loud. And so, we should be listening to what they say and incorporate that into what we do.”
- Marco Bertini
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:29 - What made him consider a career in Pricing
02:43 - Why he wrote a book that’s not about what his background was
03:48 - Three observations that point to what the book is all about
06:11 - What do you charge for?
08:01 - Objective value and perception value
10:42 - The taxi meter effect pricing versus pricing for certainty
14:21 - What is the difference between a Business Model and a Pricing Model
16:42 - A theater charging by a laugh
19:52 - What conditions must exist in order to achieve value satisfaction and end
24:01 - The different levels of performance for different ends
25:39 - Talking about risk and allocation
26:19 - His best pricing advice that will greatly impact your business
Key Takeaways:
“When you talk to organizations about pricing, they tend to focus mostly on that pricing decision, but then, I always thought that there is a much more important strategic decision that comes beforehand which is really about, what should my customers actually be paying for? What is the metric decision?” - Marco Bertini
“So, we talked a lot in the book about how you need to be able to have, think about outcomes that are quantifiable, that are verifiable, but also they cannot be tampered with. That is a very, very important condition. And laughter, for example, is one of those things that, unfortunately, you can’t tamper with.” - Marco Bertini
“What conditions must exist in order to achieve value satisfaction and end? As a customer, I have to access a product or service, if I don't access your solution, I can't benefit from it eventually. Two, conditions on access, I have to consume it. If I don't consume it, I can't benefit from it eventually. Condition on access and consumption, it has to perform. Those three conditions together are necessary and sufficient in order to get value.” - Marco Bertini
“We're very careful in the book to say that we're not ever claiming that the business is wrong and tomorrow you should be selling for performance. We have a whole section of the book based on what needs to happen not to do that. But yes, we are pretty strong, claiming that, at the very least, ownership models in this day and age, with the technology that we have are pretty much inferior in most markets.” - Marco Bertini
“Don't assume it's just a numbers game. It is certainly a numbers game, but it's much, much broader. Anything you can do to integrate whatever you do with prices, with your overall branding, or corporate strategy is well worth taking the time to do it.” - Marco Bertini
Resources / People Mentioned:
- The Ends Game: How Smart Companies Stop Selling Products and Start Delivering Value (Management on the Cutting Edge) by Marco Bertini
- Power Pricing: How Managing Price Transforms the Bottom Line by Robert J. Dolan
Connect with Marco Bertini:
- marcobertini.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Craig Zawada is the Co-Author of The Price Advantage, one of the seminal books in pricing, and he is the Chief Visionary Officer at Pros. He was at McKinsey for 13 years, ended up leading their North American pricing practice.
In this episode, Craig explains volatility and how it is present in businesses. He also shares how having the right or market-relevant price for your business is important and can have a huge impact on your business and in sales.
Why you have to check out today’s podcast:
- Learn how to know if your price is a market-relevant price
- Know more about how businesses are slowly moving towards digital, self-serving pricing instead of negotiation
- Find out how customer experience can affect your pricing
“View pricing as less of a management control issue and more of a customer experience issue.”
- Craig Zawada
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:50 - Craig explains what is volatility and where does it come from
04:26 - How companies are leaning towards prices being delivered digitally instead of negotiated
08:01 - Craig shares the challenges of moving towards a no-touch, digital self-serving pricing
10:44 - Craig defines no-touch and low-touch
12:01 - When does it make sense to put prices no-touch or low-touch?
14:22 - Craig explains the history of pricing and the changes in the buyers
17:30 - As a buyer, when do you negotiate or trust the price on the web?
20:02 - Your perception as a buyer in the market
22:06 - The trend across B2B companies moving towards the self-serve model
23:19 - Craig explains the movement in distribution and negotiation of prices
25:21 - How to find a market-relevant price?
28:11 - His pricing advice that would have a big impact on your business
29:21 - Pros’ Annual Outperform Conference that could help you
Key Takeaways:
“If you put a market-relevant price out there, that's easy to get, immediately available, they'll actually pay a little bit of premium for that, versus going through this long-negotiated process, because that takes time and money.” - Craig Zawada
“You have to be collecting these signals, and then be able to interpret and build those into your actual prices in a much quicker way than, in this environment in the past that has been more static and you can take time.” - Craig Zawada
“15 to 20% maximum should be a protracted negotiation process, where these are big deals multi-year, you know, it's meaningful to the supplier and super meaningful to the buyer, on that transaction.” - Craig Zawada
“You have to have the ability to put that market-based price to make that decision quickly because if someone else is out there, and they can give that and it's, you know fair, seems fair, the evidence shows that they're increasingly going to move towards those channels.” - Craig Zawada
“The future is moving towards where most businesses for most of their transactions are going to have the ability to go through the self-serve.” - Craig Zawada
“A lot of companies are going through digital transformations, but they're not focusing on the pricing issue and relying too much on this, you know, "high list" price umbrella that's out there. So, think of your role from a customer experience standpoint, your role of how you deliver price, and that, I think is my one piece of advice going forward.” - Craig Zawada
Connect with Craig Zawada:
- Email: mailto:czawada@pros.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Robbie Kellman Baxter is a Strategy consultant helping companies develop and optimize membership models and subscription pricing. Deep expertise in subscription-based and SaaS businesses and the Membership Economy.
Her specialties include Growth strategy, market assessment, market segmentation, the establishment of metrics, product and business planning, consumer services, premium services strategy, online services, recurring revenue, customer acquisition, customer loyalty, product marketing, social networking for the enterprise.
In this episode, Robbie talks about the need to focus on the long-term value you are creating to have a bigger share in the pricing pie. With everyone she meets talking about their ‘cancel stories,’ she shares how hiding cancel buttons can negatively impact one's branding in the long run. She highlights how one can use subscriptions strategically to build a deeper relationship with customers.
[powerpress]
Why you have to check out today’s podcast:
- Find out the key factor when considering a subscription pricing model
- Find out how to optimize tiered pricing options with subscription
- Learn how to make your subscription model so compelling that customers stay forever
“Subscription is just a pricing tactic. And it can be used in many ways.”
- Robbie Kellman Baxter
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
00:40 - How she got into subscription
01:39 - Her experience working with Netflix
02:18 - Why does she love subscription so much
03:38 - What there has to be trust and relationship in a subscription model
05:33 - What does she think about ‘Keep it Simple.’
08:45 - Tiers come later
11:06 - What it means to create a lot of value and to get a reasonable share of that value
13:41 - How do you learn from your customers where to go next and what additional tiers to add?
16:01 - Thoughts on a minimum viable product
16:41 - The impact of hiding cancel buttons
19:28 - Why is it so wrong to be making cancellations difficult
21:26 - How subscriptions can be used in many ways
24:54 - Amazon Prime as an example of a subscription pricing tactic
27:14 - Creating more value
Key Takeaways:
“Subscriptions really tie into human behavior. One of the things I always advise organizations that come to me saying we want to have subscription pricing, is, take a step back and make sure that you have a relationship with your customer that justifies subscription pricing.” - Robbie Kellman Baxter
“It's only after establishing that trusted long-term relationship that you can justify the subscription pricing.” - Robbie Kellman Baxter
“For me, if I'm going to buy a continuous stream of benefits, I need to trust that that stream of benefits is going to continue because I am turning off my consumer brain when I sign up for a subscription.” - Robbie Kellman Baxter
“What I've noticed is, the more complex the pricing, the more difficult the decision for the buyer. And so, you're always balancing that trade-off. And if you want to go back to that, that concept of turning off your consumer brain and trusting the company, it's really hard to turn off your consumer brain when the consumption is so complex.” - Robbie Kellman Baxter
“I wish companies would focus more on how to create more value because then it's easier to raise your prices if you're creating more value.” - Robbie Kellman Baxter
“With subscriptions, and I think with pricing, in general, people often know just enough to be dangerous.” - Robbie Kellman Baxter
“Hiding the cancel button leaves such a bad taste in someone's mouth that they're never going to come back to you.” - Robbie Kellman Baxter
“I find that a really tough point of view to hold if you're going to be a trusted source and you're going to take advantage of the trust that you're getting to raise your prices and hope that the customer doesn't notice.” - Robbie Kellman Baxter
“Every once in a while, take a step back and focus on the long-term value that you're creating them and say, 'How can I layer in more value to justify a bigger share of the pricing pie?'” - Robbie Kellman Baxter
Resources / People Mentioned:
- The Forever Transaction: How to Build a Subscription Model So Compelling, Your Customers Will Never Want to Leave by Robbie Kellman Baxter
- Wall Street Journal
- Burger King
- Caterpillar
- Bain & Company
- Porsche
- Amazon Prime
Connect with Robbie Kellman Baxter:
- RobbieKellmanBaxter.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Brian Doyle is the President at Holden Advisors. In his role, Brian improves his client’s revenue and profitability by building cross-functional, strategic relationships. He then leads his team to deliver results and drive positive change across client organizations. Under Brian’s leadership, his clients and business units have earned $2B, doubled their market share, and reduced commercial expenses by 20%.
In this episode, Brian shares about understanding and being able to articulate your value.
Why you have to check out today’s podcast:
- Learn how to play out the risk for your clients, letting them discover the losses they would most probably incur and letting them find out their own solutions
- Find out how to turn a sales pitch into a conversation of value instead
- Learn how to start the conversation not with a tone of selling but of adding value
“In the vast majority of the time, it's about your value. It's about what you're doing for your customers. And when you get that in your brain, that's when you can price appropriately.”
- Brian Doyle
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:18 - How his Pricing career started
02:45 - Thoughts on him taking the present role with another guy’s name on the door
03:42 - The important things that come to mind when talking about value in the C-suite
05:13 - Justifying competing priorities
06:34 - How to turn the conversation into ‘working together’ rather than ‘selling’
07:43 - How to add value the moment you start the conversation
09:02 - How to turn a sales pitch into a conversation
11:14 - Why do C-suite often is not immersed in the details of capturing value
15:04 - How to let customers calculate their value and own their solution
17:50 - The negative connotation of ROI calculator
18:49 - The need for a conversation between two sides to figure out the value they give and get from each other
20:24 - How do conversations go when you are talking to an executive about a product that is along the line of risk
21:42 - How to plat out risk in the B2B space
23:19 - How to overcome the ‘procurement buzzsaw’
25:45 - How to bring down the scale of keeping pricing and value-aligned
26:55 - His pricing advice that can have a big impact on one’s business
Key Takeaways:
“When it feels more like a partnership, ’Hey, I can totally help you guys do what you want to do, and help you make more money at it or help you serve your customers better so that they make more money on it or both.’ That's when the pieces come together.” - Brian Doyle
“When you think of value in C-suite, it's three things - increasing revenue, reducing cost, and, or minimizing risk. And what I found in my experience is that all C-suites care about one or more of those things. And the challenge that we often have is that we sell into middle managers, we sell too low in the organization.” - Brian Doyle
“The thing that keeps everything aligned and doesn't feel like you have competing priorities is that if you're really trying to do the best thing for the C-suite, which in turn is the best thing to help them serve their customers, then everything aligns.” - Brian Doyle
“Probably ten years ago, we all learned to ask this wonderful question, 'Hey, what keeps you up at night?' I would say, in this age of so much more information. It's not really a question. It's more of a statement, which is, ‘This is what should be keeping you up at night.’” - Brian Doyle
“When we are walking into a customer and doing the homework, we are thinking about the value that they provide, and whether or not they're getting paid for the value that they provide.” - Brian Doyle
“More times than not, clients of ours are stuck in the feature and benefit side of things. And they don't spend enough time thinking about the impact and the value. When I walk in, I am talking about the impact and the value that they provide to the market, where I see the market going and where I see the opportunity for them to get paid for that value that they provide.” - Brian Doyle
“When you're talking about value, it's not necessarily just the product, it might be the service, it might be the support.” - Brian Doyle
“When you talk about revenue, that Math and cost is the same sort of way, that Math is sometimes a little bit easier. But when it comes to risk, you have to think through it with the client like, how would this work?” - Brian Doyle
Resources / People Mentioned:
- Ed Kless
- Negotiating with Backbone: Eight Sales Strategies to Defend Your Price and Value by Reed Holden
- Prospect Theory by Daniel Kahneman
Connect with Brian Doyle:
- HoldenAdvisors.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Patrick Campbell is the CEO of ProfitWell (formerly Price Intelligently), the software for helping subscription companies with their monetization and retention strategies. ProfitWell also provides free turnkey subscription financial metrics for over eight thousand companies. Prior to ProfitWell, Patrick lead Strategic Initiatives for Boston based Gemvara and was an Economist at Google and the US Intelligence community.
In this episode, Patrick shares the importance of a pricing person or a pricing department to deal with the complexities of crafting pricing strategies to gain pricing leverage. He also discusses the Freemium model they use at Profit Well and how it is more of acquisition rather than a pricing model.
[powerpress]
Why you have to check out today’s podcast:
- Learn how the market is slowly going entirely towards subscription as it provides predictable expense to consumers and predictable revenue to companies
- Find out how to make Pricing and packaging powerfully work to capture value
- Learn how to gain pricing leverage by understanding the different value drivers necessary in capturing value
"Make sure you have a process. Make sure you have a pricing committee. Pricing is at the intersection of important and uncomfortable. And whenever you have that happen, those are things that get de-prioritized inside an organization constantly."
- Patrick Campbell
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:56 - Patrick's remark to Mark's praise of him being a guru
02:13 - How he landed in Pricing
03:55 - What does he think about 'so many companies don't value pricing'
05:50 - Creating a Pricing department when there is already complexity in a company
06:58 - Why are companies not so keen on the important decisions around value and Pricing
09:06 - Explaining his model: acquire, monetize, and retain
10:51 - The use of pricing metrics and value metrics
13:08 - Is Uber a subscription company
17:46 - Talking about the guaranteed price in subscription
20:04 - Can you separate Pricing and packaging
21:21 - Understanding value capture in market segmentation
22:38 - The base free offer they give at Profit Well
24:38 - Patrick's thoughts on 'freemium is a customer acquisition model, not a pricing model
27:40 - Discussing about the three types of Freemium model
30:07 - His pricing advice that can have a big impact in others' business
31:42 - The need to have a committee to make progress
Key Takeaways:
"I think the evolution is going to go from one-time purchases to subscription purchases to recurring revenue businesses. And there's obviously transitions where everything goes back and forth, and things like that." - Patrick Campbell
"I would say that there are things you can do independent of Pricing or independent of each other with Pricing and packaging, that leads to essentially different optimizations. So, I think that you can work without each other. But there's a lot that they rely on with one another. So, it gets a little more complicated." - Patrick Campbell
"I don't think you're going to have pure dynamism anytime soon. But I think you'll start seeing segment-based Pricing sooner than later." - Patrick Campbell
"We chose the freemium round, for a lot of reasons, basically, it's an acquisition model. It's not a pricing model." - Patrick Campbell
"I think that the big thing you have to think about with freemium is it's opening the top of the funnel, so if it is up of the funnel, it is something that will influence your Pricing. But it's not part of your Pricing strategies core." - Patrick Campbell
"It's been successful because we get two effects that come from Freemium. One, there's a network effect because every time we get more data, it goes into our algorithms of our pricing or retention products. And these are just things that makes them better. But the other thing it does is, it lowers our CAC, or customer acquisition cost quite significantly." - Patrick Campbell
Connect with Patrick Campbell:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Paul Hunt is chairman at Pricing Solutions. He is considered as one of the luminaries in Pricing. In 2013 he wrote a book entitled: World Class Pricing: The Journey. Of late, he is now teaching mindfulness.
In this episode, Paul talks about how companies in a fast-paced digital environment fail to recognize what their product’s true value is. With a significant change in the market and with all the competitive disruption, and deregulation taking place they fail to see what their true worth is. He also shares about his mindfulness practice and how it benefits pricing people especially those with cross-functional departments in being present, responding and not reacting, and being creative in finding solutions.
Why you have to check out today’s podcast:
- Learn how to price value and stay relevant amidst the changing times
- Find out how to price in the digital environment and remain competitive
- Discover about mindfulness meditation and how it can help be a responsive, open-minded, and effective leader
“Value is so much of a mystery for every company. Some companies get closer than others in understanding what their value is, but there’s often a gap and sometimes a significant gap.”
– Paul Hunt
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:16 – How Paul started a career in Pricing
02:03 – What made him stay with Pricing
02:57 – Why only a few understand value yet it’s important in business
04:44 – The need to be always relevant with the times
07:08 – Thoughts about procurement blowing up deals
09:07 – What is a challenger sale
13:37 – The biggest problem in Pricing today
15:26 – On talking to five people instead of doing research to figure out where the value is
17:48 – What makes his company sellable
19:01 – How long has he been doing meditation mindfulness? How does it help him?
21:17 – His thoughts of bringing lessons in meditation to business practice, particularly with pricing professionals
22:14 – How to be in the present moment
23:33 – Different ways to do mindfulness
Key Takeaways:
“Pricing is a disguised word for value.” – Paul Hunt
“I think they live and breathe value, but they’re almost so close to it that they don’t see it all clearly at times. That’s why they need an outside perspective occasionally.” – Paul Hunt
“They’ve got a company because they’ve built value. They’ve delivered value. They do know value in a sense, but, of course, nobody’s perfect.” – Paul Hunt
“You’ve got a challenger sale happening when at the end of the meeting the customer says, “I learned a lot in that meeting. I didn’t know. That’s the challenger sale at its best.” – Paul Hunt
“It’s kind of scary when you’re launching new technology in today’s fast environment without getting that homework done, but clients, they’re stretched, and they don’t have time. That’s the biggest challenge.” – Paul Hunt
“And I think everybody can really benefit from mindfulness practice. I think pricers who are dealing with a lot of cross-functional departments, finance, marketing, sales, operations, you’ve got a lot of responsibility, but sometimes not as much control as you’d like. The whole concept of responding rather than reacting is bang on. That’s exactly what a pricer needs to sort out, how do I do that?” – Paul Hunt
“I think of it as an open mind that has great value in terms of your ability to respond, be effective, and be creative, and all those kinds of stuff.” – Paul Hunt
People / Resources Mentioned:
- Spin Selling by Neil Rackham
- World Class Pricing: The Journey by Paul Hunt
- Mindfulness-based stress reduction (MBSR) by Jon Kabat-Zinn
Connect with Paul Hunt:
- E: phunt@pricingsolutions.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Amy Konary has more than 20 years of experience advising companies on subscription business strategies. She is the founder and chair of Subscribed Institute, a think tank for the subscription economy. Through the Subscribed Institute, Amy brings together a community of business executives, thought leaders, and industry experts at a series of Executive Summits and events. She generates research and industry benchmarks on subscription transformation topics. Amy also advises Zuora customers on subscription business strategy development, execution, and maturity.
Amy shares about subscription success in this episode, impacting revenue growth by enabling flexible pricing and product packaging.
Why you have to check out today’s podcast:
- Learn about how subscription pricing considers three pricing models to maximize revenue
- Find out the three pricing elements that impact revenue growth
- Learn to understand the B2B Subscription Pricing
“Simple core with flexible pricing, that would be my advice.”
- Amy Konary
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:41 - Amy talks about the report B2B Subscription Pricing: Three Critical Elements That Impact Revenue Growth
03:07 - What is flexible pricing
04:44 - Company that uses a flexible pricing
06:07 - On price tweaking
08:14 - How is a product defined
12:04 - Flat fee versus per unit pricing
13:51 - Getting in-depth into per-unit pricing
15:25 - The difference between per-unit pricing versus usage-based pricing
17:59 - Discussing growth rate in terms of using or not using usage-based pricing
19:18 - How Box uses a usage-based pricing
22:13 - One important pricing advice that could have an impact on one’s business
Key Takeaways:
“What we find in the subscription world is the way that you add flexibility is by coupling a simple and flexible approach. And what we mean by that is rather than selling products, you're selling services around specific subscribers.” - Amy Konary
“The fastest-growing companies are those that introduce new packages or products more frequently.” - Amy Konary
“Pricing and packaging are really important, your ability to cross-sell, and upsell is really important. Your ability to increase volume is really important because that's really where you're going to get the most of your revenue from that subscriber.” - Amy Konary
“Keep it simple, just launch something really simple when you get to market. As the company matures, as their revenue grows, that's where you start to see companies do segmentation, really get into the good, better, best models, maybe sell some add-ons.” - Amy Konary
“In the subscription world, you want to eliminate that kind of friction, you want to make it really obvious to the customer, what they should buy, and what kind of value it's going to offer to them. You’re doing yourself a disservice if you've got too much choice for customers.” - Amy Konary
“We see usage-based pricing being a really important approach, particularly in situations where it's really important what that usage might be to the value that you're getting out of the service.” - Amy Konary
People / Resources Mentioned:
- Carl Gold
- box.com
- B2B Subscription Pricing: Three Critical Elements That Impact Revenue Growth
Connect with Amy Konary:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Mark Stiving, Ph.D., MBA, is a widely recognized pricing expert and marketing pro who teaches companies how to boost revenues and realize their true value.
Theresa French is the Sales and Marketing Operations Manager at Impact Pricing.
Pricing has been a lifelong passion for Mark. As a child, he contemplated why companies always use 99 cent price endings, which led to the question, "Do companies think we're stupid?"
As Mark would admit it, he feels guilty every time he is selling, that's why he wants everyone to know what he is doing, and the reason why he does Impact Pricing Podcast.
In this episode, Theresa and Mark talked about IP’s program called Guidance for Pricing Success(GPS), sharing everything you need to know about it, who this program for, what's in it for you, and what solution this would ultimately provide to a company's faster revenue growth.
Why you have to check out today’s podcast:
- Find out why companies should go for Guidance for Pricing Success(GPS) over hiring a pricing consultant
- Discover the ultimate value you can earn from the courses offered in Champions of Value
- Learn about the impact value conversation brings to your product, to your customer, and ultimately to your company’s profitability
“Every company I’ve ever talked with and I’ve ever worked with, they don’t understand what value really means.”
– Mark Stiving
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:43 – Mark talks about a program he’s releasing called Guidance for Pricing Success (GPS)
02:58 – For whom is Guidance for Pricing Success(GPS)?
04:45 – Who can take the most advantage from The Champions of Value?
06:13 – Convincing reasons why you should go for GPS over hiring a consultant
08:20 – What company challenge is GPS creating a solution for?
09:55 – Strengthening the value conversation
11:51 – How to go about value conversations and how to have this conversation with a customer
13:09 – What’s in it for you in the courses Champions of Value offer and why you will get value way more than what you paid for the courses?
14:39 – Mark confessing his guilt in selling and helping you
Key Takeaways:
“Everybody needs GPS. If there was anything I could convince people of, it’s, you need to go understand value, how your customers perceive your value. Most companies have at least realize they want to move away from cost-plus pricing, they want to do value-based pricing. And yet they don’t understand value.” – Mark Stiving
“Champions of value is really about helping people learn way more about pricing and the things they need to know. And at the same time coaching them to deal with internal politics, or how to have meetings or how to do change management.” – Mark Stiving
“The other thing for the champions of value is when we have smaller companies, companies that aren’t quite at the $50 million range. It’s pretty cost-effective if they send several people through the champions of value program, and then they can try to implement this themselves.” – Mark Stiving
“If you have somebody who understands value and puts themselves in the minds of the buyer, and we’ve really thought through this, well, then you’re much less likely to make those million-dollar mistakes.” – Mark Stiving
“CEOs have many different issues. Probably the one thing that they would say, ‘I’m not growing fast enough, I need faster revenue growth.’ And how do they go get faster revenue growth? Well, it turns out that probably what’s happening is the company has figured out how to deliver a lot of value to the marketplace, what they haven’t done is figured out how to capture that value.” – Mark Stiving
“Why wouldn’t you spend 100 bucks a month in order to get promoted in order to improve your career, and I don’t care who you are if you’re a pricing professional if you’re a product manager if you’re a product marketer if you’re in sales. If you understand value, the way your customers understand value, I guarantee you it will impact your career for the better.” – Mark Stiving
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com/
Connect with Theresa French:
- Email: theresa@impactpricing.com
Tim Williams is a Business Model and Pricing Strategist for professional services firms. He is an industry veteran who is the Founder and Managing Director of Ignition Consulting Group, also a noted author and presenter for major industry associations and business conferences worldwide. As a career marketing professional, Tim’s seminars and keynote presentations have taken him literally around the world, including North and South America, Europe, Asia, India, and Australia.
In this episode, Tim highlights how important it is to devote your time, effort, and energy to the value you can create - a diagnosis of the matter, so to speak, rather than jump right into the solution.
Why you have to check out today’s podcast:
- Find out how to maximize profits through value creation
- Learn how to price based on value by understanding what success looks like
- Discover an effective method of receiving a rate more than what you would quote your client for
“A lot of companies and professional firms have jumped straight to the scope of work without considering what I call the scope of value, without having a clear definition of what success looks like.”
- Tim Williams
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
00:40 - What led Tim’s path to Pricing
01:54 - The change from hourly to project-based pricing
02:55 - What pricing model do advertising agencies adopt
04:09 - How hourly rate charges for the cost and not the value
04:51 - The Cost-Plus Pricing hardware companies are using
05:48 - How disclosing more cost information veer away from the value creation
06:34 - The difference between a business model and a pricing model
08:06 - How Cost-Plus Pricing and Hourly Rate Pricing doesn’t capture value
09:29 - Thoughts about communicating value
11:45 - Why it is sometimes hard to price based on value
12:18 - Effective method he uses for charging clients’ high rate
13:08 - Receiving from clients beyond the base price you set
14:15 - Companies going for a subscription model pricing
16:16 - How does the subscription model look like in a crisis communication training
17:28 - The challenges and future of subscription model pricing
19:13 - Areas where the subscription model doesn’t apply
22:54 - One piece of pricing advice that can have a big impact on one’s business
Key Takeaways:
“The hourly rate is only a manifestation of your cost structure. It's not a revenue model at all. I think the central problem in professional services is that by using the hourly rate, professional firms are simply charging for their costs, not their value.” - Tim Williams
“Unfortunately, professional firms, agencies, in particular, have ceded way too much power to professional buyers by disclosing more and more cost information. You're having completely the wrong conversation. You're not talking about value created, you're talking about costs incurred.” - Tim Williams
“Devote your time and energy to the scope of value question.” - Tim Williams
“I think letting your client decide what the value is, can also sometimes be effective.” - Tim Williams
“I certainly know there's a school of thought that believes that the entire business world is moving toward a subscription-based model. I think it's a little more challenging in the service world than the product world. But even in professional services, there's a fair amount of intellectual property that resides in professional firms that can be packaged up, named, turned into options, and offered via subscription.” - Tim Williams
People / Resources Mentioned:
- Ron Baker
Connect with Tim Williams:
- Ignitiongroup.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Dave Daniels is a technology veteran with a passion for product marketing and product management.
He is a founder of Launch Clinic, which was acquired by Pragmatic Institute (formerly Pragmatic Marketing). He is also a Pragmatic Institute certified instructor, strategist, problem solver, mentor, speaker, entrepreneur, and traveler.
In this episode, Dave talks about a product launch framework that incorporates crucial components such as customers, segments, competitors, and positioning necessary to build a pricing roadmap that targets your company’s objective.
Why you have to check out today’s podcast:
- Discover about a product launch framework which drives a pricing structure towards achieving a company-wide goal
- Learn about straightforward strategies of raising your prices to meet your business objectives
- Find out how to increase your price better by using a price launch framework
“Always assume that your customers are willing to pay a higher price than you think that they do. Because you often look through your own lens of what you would be willing to pay, not what the market would be willing to pay. You can always go down, it’s hard to go up.“
– Dave Daniels
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:34 – How did Dave get involved with Pricing
03:23 – Talking about his aha moment in Pricing – the notion of ‘which one’ or ‘will I’
05:03 – How does a product launch framework look like
06:39 – The fact about not many companies consider about Pricing in the planning stage
08:09 – What happens when the product launch plan is not well-thought-out and well-developed
09:31 – The difference between a launch and a release
11:11 – How should we go about as we launch prices
12:19 – The scary thing about increasing your prices
13:42 – What are the two phases of the product launch framework
15:29 – Doing a price increase better by using Dave’s price launch framework
16:43 – Components of the price launch framework that you need to look into
19:05 – On being straightforward in raising your price
20:53 – What’s the best thing about having a pricing framework
22:38 – Dave’s thoughts on pricing roadmaps
Key Takeaways:
“It’s not how much it cost us to build it and then price it. It was like how much do people willing to pay?” – Dave Daniels
“It always came up as a big issue around launch a lot, mostly because in the launch planning process, it starts and everybody starts thinking about all the tactics, the promotional stuff. And then they forget about these important little business details like how are we going to price the product, what’s our pricing strategy, how are we going to price in this market versus that market?” – Dave Daniels
“At any time prices are increased, somebody somewhere is going to be upset, their feathers are going to be ruffled. That’s to be expected, and you should put that into your calculus, that it is possible.” – Dave Daniels
“Frameworks provide structure and direction. And they’re designed to integrate with other frameworks.” – Dave Daniels
“Don’t be afraid to charge a higher price because you’ll be surprised at how many people will actually pay for it.” – Dave Daniels
People / Resources Mentioned:
- Tesla S
- Hyundai
- Kia
- Zipcar
- Netflix
Connect with Dave Daniels:
- BrainKraft.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Jose Morabito is a highly accomplished Pricing & Finance Executive with an outstanding ability to generate strategies for and deliver on innovative projects.
In this episode, Jose talks about how he carries out his function as a pricing executive. As a pricing person dedicated to seeing the whole company's goal, he emphasizes the three important constituents who made up the company whose welfare needs to be taken care of. He also could not stress enough on how value plays a big part in pricing decisions.
Why you have to check out today’s podcast:
- Learn about the mindset of looking beyond your current job, so you continually evolve, improve, and become competent as a leader who is ready to handle the challenges of what lies ahead
- Find-out the three organizational constituencies that are crucial in making pricing decisions
- Discover how to make sound pricing decisions amidst organization disagreements
"We at pricing are an enabler to the business. We're not a barrier."
- Jose Morabito
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:18 - How Jose’s journey in Pricing began
02:09 - What is revenue management
03:20 - What made him choose Pricing after moving between Finance and Pricing
04:54 - What are Finance people most concerned about
05:29 - Jose’s thoughts on Finance people being risk-averse, hence the focus on Cost-plus Pricing
06:14 - Life lessons from Jose’s mentors
08:12 - What's the key to making great pricing professional
09:53 - His thoughts about soft skills versus technical skills
13:36 - At what point should I question what you say
14:59 - How hard does he push against a constraint
15:43 - How does he encourage his people to push against a wall
16:35 - Not saying yes right off the bat
17:15 - Misconceptions people need to hear about Pricing
18:34 - How to communicate Value versus Pricing to product and salespeople
19:33 - Which pricing model did Amex, ADP adapt to
20:05 - Jose's Pricing advice that can have a significant impact on your business
Key Takeaways:
“The ability to think like a general manager is key in making a good pricing person.” - Jose Morabito
“You typically have at least three constituencies in a company - a shareholder, a customer, and an employee. And depending on the role that you're in, your job is to look after one of those three constituents." - Jose Morabito
"A good pricing person needs to have the ability to think like a GM and see and understand and weigh the impacts to the three constituents when making a decision." - Jose Morabito
"Whenever you can influence somebody by saying, 'I had this experience in the past and we did something like this and here's how it succeeded or failed' - I think that adds a lot of credibility to what you're saying." - Jose Morabito
"The person who's ready to be promoted is somebody who has already been performing at the next level.” - Jose Morabito
"If you are not agreeing to the decision early on, and then agree at the end to support it, that agreement is the only thing that people outside of that room need to hear." - Jose Morabito
People / Resources Mentioned:
- Alan Gallo
- Doria Camaraza
Connect with Jose Morabito:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn to be directionally correct in your pricing decisions
- Find out the important characteristics required to be a pricing expert
- Learn how to be creative and do different things in Pricing to know what works and what doesn’t
Stephane Bratu leads the pricing and marketing analytics team for the e-commerce division of one of the largest distributors in the world. He developed advanced decision support systems to improve business performance and spearheaded many engagements to Fortune 500 clients in the transportation, manufacturing, distribution, and retail industries.
He also developed analytics insights to help clients improve their business decisions., as well as conducted opportunity assessments, pre-sale analysis, solution design, and implementations using advanced machine learning and optimization modeling.
In this episode, Stephane talks about the important characteristics of a pricing person, why he has to go beyond the analytics side of things, get expertise in team management, and be knowledgeable to different pricing models in order to contribute to successful pricing decisions.
“There is no silver bullet in pricing. Otherwise, we would all know it.”
- Stephane Bratu
Topics Covered:
01:10 - What led to his Pricing career
02:15 - What makes him stick with Pricing
03:37 - What got him to a VP position in Pricing
06:02 - Is analytical capability a skill necessary for a pricing person
06:44 - The need to learn management skills, and people skills aside from the analytical side of Pricing
07:21 - Why are mentors important
08:15 - What to consider when promoting people
10:20 - The advantage of him coming from a data science side of things
13:15 - People that do analytics and execute on a day-to-day basis versus those who figure out what we should do differently and execute it within the company
15:45 - Is value a key driver in analytics and how do you capture value
17:19 - Keep getting better at creating value
18:06 - His pricing advice that creates an impact in your business
18:34 - The need to get creative in getting optimal pricing
Key Takeaways:
“I realized in the past, it is very important to have mentorship that gives you a different perspective, organizes your thoughts, enables you to perform well.” - Stephane Bratu
“Value pricing is hard. It's very hard to implement. And to capture the value is to really, really understand the business.” - Stephane Bratu
“You have to be careful in the way you price your value so that you take into consideration right where the competitor is doing. So, it's very important in the details. You would never get it 100%. But if you move in the right direction, capture the value, that could create a competitive advantage.” - Stephane Bratu
“Value pricing is important because value is expensive. So, you need to reap the benefit of the effort that you make to create value for the customer. And if you don't do that, you miss opportunities.” - Stephane Bratu
People / Resources Mentioned:
- Professor Peter Belobaba
Connect with Stephane Bratu:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Find out the three pillars that a great pricing professional should be skilled in to enrich the pricing function of the company and ensure its success on a larger scale
- Find out how the Finance department complements Pricing people in terms of achieving a company’s overall pricing strategy
- Learn about what encompasses pricing strategy to meet a company’s long-term goal
Anton Malygin is a seasoned executive with years of experience building new capabilities and driving enterprise transformation in Fortune 1000 companies, focusing on revenue growth, new business models, pricing strategies, price and revenue management, commercial excellence, profitability improvement, market intelligence, customer experience, and business transformation.
In this episode, Anton shares how knowledge of different industries helps you become an effective pricing person as you are exposed to different pricing strategies and issues. As pricing is important to the company, so is the pricing team, thus, he also talks about what important skill sets one should possess to fill in the crucial role in pricing.
“Stay relevant to the organization. If you will stop being relevant in your organization that's going to be the end of pricing discipline in the company.”
- Anton Malygin
Topics Covered:
01:13 - What led Anton into Pricing
02:32 - Two types of pricing projects he does which contrasts the impact it has on customers
03:20 - Why is he staying in Pricing and what does he love about it?
04:27 - How is it working with product management or sales or marketing as a VP of Pricing and Licensing
06:01 - How do he and his team help in making people understand the value of a product
07:29 - Does he have a team of Pricing people working with him
07:57 - The three important pillars that are required of a great pricing professional
10:45 - What his team is building out at Palo Alto - in terms of being a pricing consultant or one that sets the price
12:37 - Why the Finance department is valuable and at the same time challenging
13:47 - What do Finance people focus on and what do they miss out
18:28 - Why it is important to be a thought leader
19:30 - The advantage of understanding different industry pricing issues and techniques
20:49 - What Anton’s role like in Palo Alto
21:40 - Does he have a mentor
23:24 - What important pricing lesson he likes people to know more about
24:58 - What is a pricing strategy
27:29 - Anton’s pricing advice that can impact your business
Key Takeaways:
“I see myself developing, and pricing also leads to a lot of other different opportunities, being part of the pricing organization in the company. You become one of those important centers in the organization. And it feels like you're impacting a lot from the standpoint of the performance of the company.” - Anton Malygin
“When we engage with a product organization, we work with them side by side on development of the strategy, and the pieces that we're bringing to the table as a pricing methodology, one of them is a value-based pricing focus.” - Anton Malygin
“The pricing person has to have good relationships and has to be a very good communicator and relationship builder with corporate management, marketing, sales, finance, etc.” - Anton Malygin
“The pricing person has to be perceived as a leader, as someone who's knowledgeable about pricing, and that is extremely important because if a pricing professional is just average and has an average knowledge of pricing, well, she’s/he’s probably not very different from any other product manager or finance person that sometimes does the pricing or marketing.” - Anton Malygin
Connect with Anton Malygin:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
* Learn how to involve stakeholders in making pricing decisions, why it is considered a team effort
- Determine the best ways to be influential and stay price competitive despite experiencing business challenges
- Find out the key qualities required to rise through the ranks and become a highly qualifies and effective pricing executive
Wendy Johnson started out as an M&A Consultant at Accenture. After she got her MBA, she went to IBM, another big corporation as a pricing and investment specialist. She was at CA Technologies for eight years where she was VP of Global Pricing and is now an executive at FIS.
In this episode, Wendy talks about what skills and characteristics you need to have to function as a key pricing executive effectively, at the same time manage the best pricing team and how being logical is crucial in making pricing decisions.
“I find that we can do the best work in terms of pricing and setting a price that best aligns with your strategy. But the people who have to execute it determines the success of that price.”
- Wendy Johnson
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:18 - How did Wendy start her career in Pricing
02:40 - What made her stay in Pricing all these years
03:24 - What made her rise up through the ranks
04:43 - What influence do her mentors have on her
05:41 - Is she a logical or touchy-feely managerial person
06:51 - The important skills needed to be in a pricing team
09:45 - How to set pricing where sales and product management department agree
11:46 - Doing the right thing for the business
12:24 - Pushing the big wall
14:27 - Qualities of a leader that are needed to replace Wendy
15:38 - Wendy’s one big Pricing advice that would impact one’s business
16:53 - How to get people to understand the value of their products
Key Takeaways:
“I think the key is knowing how to build relationships. Pricing is, typically anytime you're making a pricing decision, there's a lot of emotion behind it, whether it's from the product owners, or the salespeople, there's conflict across those different groups. And you have to be able to manage those discussions and not be emotional and come out with an answer that maybe not everybody likes, but everybody can accept, and everybody can support and respect.” - Wendy Johnson
“A lot of times when you have, most of the work that's thrown our way where people want some kind of pricing analysis. The problem is, usually not pricing. People usually think it's pricing because it's the easiest thing to point to.” - Wendy Johnson
“The most valuable use of your time is probably figuring out how to be the most influential within the constraints that you have, and trying to make an incremental change on pushing out those walls at the same time.” - Wendy Johnson
“Who do you choose to replace you? It's a tough decision and it's usually looking forward in terms of what's next on the docket and who you think would be better aligned to that particular project?”- Wendy Johnson
“You can tell how good your sales team is, if you ask somebody else in the company like an administrative assistant or somebody in operations, what your company sells and what the value is, and if they can answer that. Do you have champions for what you do as a company and do they understand the value?” - *Wendy Johnson*
People / Resources Mentioned:
-
Denise Elias
Connect with Wendy Johnson:
-
LinkedIn
Connect with Mark Stiving:
-
Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn how the airline industry comes up with optimal pricing to maximize profitability
- Find out how to come up with optimal pricing to move the industry appropriately even in a competitive environment.
- Discover the needed skill sets of a leader to keep driving to get things done
Chris Amenechi is a VP of Pricing and Revenue Management at Copa Airlines, and Managing Director at Amencil, Inc. He is a transformative travel leader who is an expert in Merchandising, E-Commerce, Distribution, Pricing, Revenue Management, Planning, and Corporate Strategy, Digital and Data Strategy, Marketing Optimization, and Business Process Transformation.
In this episode, Chris shares about how revenue management works in designing a pricing mix for an airline company. He went on to discuss the people and skillsets needed to form a strong team to meet a company’s objectives. At the same time, he points out what leadership traits you need to possess to be an effective VP of Pricing.
“Pricing is not a sprint, it's a marathon. And so, yes, inasmuch as you're shortsighted to make a quarter work, you want to elevate the year and the next year and the next year. The whole idea is to get your product, depending on what it is, to be at the top of the marketplace.”
- Chris Amenechi
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:20 - What led Chris onto the Pricing path
02:11 - How does revenue management differ from yield management
04:30 - How much of the fees passengers pay add up to an airline’s profitability
07:45 - Thoughts on everyone being upset over airlines starting to charge for checked luggage
11:19 - How about giving a discount to passengers with no checked luggage
12:13 - The characteristics needed to become a VP for Pricing
15:57 - Why the need to look at pricing from a customer perspective, from an industry perspective and a competitive perspective
19:09 - Talking about the risk-averse nature of most management
21:06 - Who gets to be promoted or not
Key Takeaways:
“If you want to get the optimal revenue point you've got to get into some revenue management, which means there are loss leaders, there's this cheaper prices, there's this more expensive prices based on all the demand, all the demand profiles you have, the customer profiles you have. Revenue management is the ideal pricing and allocation of inventory and combining the two is an optimal way to generate the most for the system of that airline.” - Chris Amenechi
“Everybody in the world, whether it's the phone companies, your cable companies, they're able to restructure their rate structures. So they would give you the minimal package and they'll go up to the big packages and then if you wanted anything additional was your choice. It’s the customer choice model and it was an upsell model.” - Chris Amenechi
“I would say two most important things needed to get promoted to VP are a dedication to being a bit of an innovator, a bit of an expert, and also a bit of a routine player. You've got to be able to do all three.” - Chris Amenechi
Connect with Chris Amenechi:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Find out the key characteristics of a pricing person which is important in order to communicate complex matters breaking them into simpler concepts for easier pricing decision-making
-
Learn the pricing expert’s role in sales and project management
-
Look into the crucial role of a pricing person in the organization’s profitability
Yann Gaucher is a results-driven technology business leader experienced in pricing, licensing, as well as delivering initiatives that impact revenue, market growth, customer acquisition, and product expansion for global software companies.
He believes that success is based upon keen business acumen; a deep understanding of the business infrastructures’ sales needs to sell products and services; a compelling ‘get the job done’ work style and an uncompromising belief in offering the best possible solution to the customer.
In this episode, Yann walks us through what a pricing person’s role looks like, the responsibilities that go with it. And how he rose from the ranks to become the VP of Pricing.
“The ability to drive and drive insight into the data and be comfortable to put oneself out there, I think is what will drive recognition and visibility in someone's career.”
- Yann Gaucher
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:26 - What got Yann into a career in Pricing
02:13 - Yann’s thoughts on product managers not focusing enough on price
03:37 - How Yann’s roles as a business analyst and product manager helped in the
07:11 - Finding a middle ground between empathy for the salesforce and fulfilling company-wide objective and profitability
09:05 - Being comfortable with data and knows how to understand data and not necessarily being an analyst
11:50 - What is an important characteristic of a Pricing person
14:56 - How sponsorship help influence pricing decisions in an organization
16:42 - The benefits of having mentors
18:28 - How important is managing people
20:16 - Describing his role as VP of Pricing
21:38 - Does Yann’s team set the prices
22:51 - How much product managers know about a product’s value
Key Takeaways:
“The [pricing] role we are in is difficult. We have to have that empathy in helping the salesforce promote the product at the same time you have those company-wide objective and profitability aspects that you also have to go and champion and find the right middle ground. sometimes it's not easy to please everybody in that room.” - Yann Gaucher
“You have to understand what will help you create that opportunity and when it comes down to pricing, be able to interpret the data, and extract insight from it is crucial.” - Yann Gaucher
“The understanding of the data is very key because it will be always a function of how a given organization is structured.” - Yann Gaucher
“Drive and leadership are key characteristics of a good pricing person. In that space, people will really come to you and tell you what to do and when they want. You have to be able to be proactive about what to look for and what needs attention and be able to make the case and especially communicate complex concepts simply. - Yann Gaucher
“Pricing is one of the functions, I think, where it's very easy to drown in data and in analysis paralysis, and you need someone that can break up that breadth.” - Yann Gaucher
“I had the chance to have a couple of mentors that I was able to rely on. They were mentors more in the sense of growing up as a person, as a manager more than just pricing.”- Yann Gaucher
Connect with Yann Gaucher:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn why the Less-Than-Truckload industry is different from other logistics services
- Discover the pricing complexity in the Less-Than-Truckload industry
- Find out the different struggles within the Less-Than-Truckload industry when it comes to pricing their services
Curtis Garrett is the VP of Pricing at Recon Logistics, a world class LTL Freight Management Company. Curtis is on a mission to simplify LTL Freight. His career-long goal is to bring transparency, automation, and the tools needed to do this into the LTL industry.
In this episode, Curtis talks about the pricing design in a Less-Than-Truckload (LTL) industry, sharing the complex variables that go into the LTL price mix. He also shares some personal backstory of how he was able to advance and uplevel his pricing career, proving that you don’t need a college degree to have a great career. Take inspiration from Curtis’ success journey in pricing.
“As long as you are well aware of what your costs are, that gives you the freedom to build your actual profit and your margin in different ways. And make it a little more flexible for who you're trying to engage with.”
- Curtis Garrett
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:27 - What started Curtis’ journey into Pricing
02:14 - The pricing complexity of a less-than-truckload freight business
05:44 - How Curtis’ mentors influenced his pricing career
08:16 - Does Curtis work with a team?
09:40 - Characteristics that are prerequisites for promotion in the kind of workplace that he has
13:00 - Making sure that what you’re doing in the day-to-day basis net out to the overall strategy of the company
19:03 - How hard it is to be pushing more than one wall at one time
19:37 - How not having a degree affected his career
23:02 - How he landed a VP position without having to be asked which school he graduated from
25:28 - It’s not the degree, it’s your skills that matter
Key Takeaways:
“Industry-wise, LTL is somewhat comparable to airline and hotel pricing. But it's even more complex, in my opinion, because a seat on an airplane or room in a hotel, you pretty much know there's no space variable there. But with LTL freight, you really don't know the size of the freight you're going to get and how much room it's going to take up in your trailer.” - Curtis Garrett
“The balance of keeping that larger macro strategy in your mind, but in the day in, day out, or even minute by minute, making sure that what you're doing is the best possible work at that time.” - Curtis Garrett
“I don't think any wall that can be pushed over is the right wall you should be pushing against anyways. If it is something of value and the right problem to be solved, I think by default, it's gonna take a while and it's gonna be hard.” - Curtis Garrett
“I think anybody can be successful and if there are large companies out there that hold back candidates just because of that one disqualifier, then, I think they're probably missing out on a lot of good people.” - Curtis Garrett
Resources Mentioned:
- Todd Polen
Connect with Curtis Garrett:
- reconlogistics.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn about how the Pricefx pricing platform optimizes pricing
- Find out about the Pricefx pricing system’s flexibility which enables it to work across different industries using only a single platform
- Learn about Pricefx subscription pricing strategies
Gabe Smith is the Chief Evangelist at Pricefx. He is a Brand ambassador, thought leader, and chief storyteller. Responsible for expanding awareness of price optimization, CPQ, and the Pricefx brand throughout the universe.
He works with strategic clients and new use cases and feeds innovation back into the product organization. He also develops unified marketing content that extends into the sales process to create a resonant and unique position for Pricefx.
In this episode, Gabe talks about Pricefx’s pricing system and how it is used across different industries using a single platform.
“Realize that there are potentially different segments of customers that get different value, and package to offer in a way that appeals to those and set your pricing in a way that makes sense with those things in mind.”
- Gabe Smith
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:03 - What led Gabe to Pricing
02:20 - From a pricing consultant to a management role
02:39 - What monetizing innovation is all about
04:02 - What is Pricefx built for
05:36 - What does Pricefx actually do
09:46 - How does the Pricefx pricing system capability respond to different industries
11:31 - The different industries Pricefx pricing has served
14:11 - Thoughts about generation-one customers having tons of custom-versions of their product in the marketplace
14:58 - What’s the smallest-sized company Gabe would recommend buy from Pricefx?
16:19 - The advantage large companies have with Pricefx platform
17:35 - How does Pricefx do Subscription pricing
19:12 - Thoughts on subscription pricing and the three value levers
19:54 - Gabe’s pricing advice that will have a big impact on your business
Key Takeaways:
“We believe strongly in being able to reflect all of the things that influence, especially the ones that really move the needle with regards to the net margin.” - Gabe Smith
“Pricefx is really about speed and flexibility - instead of trying to pre-bake things - and make them simple. We have the architectural flexibility to be able to make changes to account for those industry-specific needs as well.” - Gabe Smith
“What we decided was that our value metric, the thing that aligns most readily to the value our customers get from our solution, is the amount of revenue that they're managing, and potentially the capabilities.” - Gabe Smith
“You've got to have the ability to have a subscription that makes sense, but also have the implementation aspect lightweight enough, where they're not going to have a big IT team and a bunch of pricing people to work on (it), and project management people to manage this whole thing.”- Gabe Smith
Resources Mentioned:
- Monetizing Innovation: How Smart Companies Design the Product Around the Price by Madavhan Ramanujam
Connect with Gabe Smith:
- E:gabrielsmith@pricefx.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn about the concept of digital transformation and its relevance in this evolving world of pricing
- Find out how better pricing is achieved through artificial intelligence with less human intervention
- Discover the need to integrate digital transformation with customer experience to create an impact in pricing
Craig Zawada is a Sales Growth and Pricing Strategy Expert.
He joined PROS in 2010 and serves as its Chief Visionary Officer. He is responsible for creating and articulating the vision for how PROS uses big data and the latest technology, to help companies drive incremental sales growth and profit improvement.
In this episode, Craig shares how relevant market prices can be created with less human intervention.
“View pricing from that customer experience perspective, not from the management perspective of trying to protect margin and all those things.”
- Craig Sawada
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:09 - What paved his entry into the world of Pricing
02:26 - Moving from consulting to technology - his entry into Pros
04:02 - His thoughts about the concept of digital transformation
06:38 - Taking a look at the concept of digital transformation in B2C versus B2B companies
09:37 - How to gauge willingness to pay accurately
12:35 - Setting market-relevant price without human intervention
16:59 - Why we cannot do away with negotiating the price
19:39 - Tradeoff of the price for benefits
20:22 - When is the use of AI in pricing applicable
21:38 - His best pricing advice to impact businesses
24:00 - Factors to help understand customer’s willingness to pay and why it’s important to integrate into the pricing system
Key Takeaways:
“Digital transformation to me is how you transform your process in pricing, such that you can deliver on this new customer's need of getting a fair market price immediately, without having to go through this management problem of pricing that companies try to control.” - Craig Zawada
“The interesting part and where AI is incredibly applicable and really important in this environment in the future environment is being able to make those decisions without human intervention to set the market-relevant price.” - Craig Zawada
“A lot of this back and forth negotiation is due to a lack of confidence in knowing what the market price is.” - Craig Zawada
“People want choices, right? So they want to be able to configure their choices and understand what are the implications of that, so you can know ways of reducing the price.” - Craig Zawada
“From a pricing perspective, you have a tremendous opportunity to have an impact by integrating price into that digital transformation, because it's one of the most fundamental things that is part of that customer experience in buying.” - Craig Zawada
People / Resources Mentioned:
- Gartner
- Saint Gobain Glass
- McKinsey
Connect With Craig Zawada:
- pros.com
- czawada@pros.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn the factors to consider when building a distributor pricing strategy
- Find out the uniqueness of the spirits industry and how pricing decisions are made taking into consideration all the concerned parties involved
- Discover the process of how the product in the spirits company go through different distribution channels and ultimately brought to the end-consumers
Karl Petersson was the Director of Commercial Performance at Bacardi. He had worked in the spirits industry on both the supplier and distributor side. He also has 12 years executive experience in commercial strategy development and people management.
He managed a Finance and Pricing responsibility for a $300-million consumer packaged goods business improving profit by +$6 million. He has 4 years of experience managing the P&L of a consulting business and grew the revenue 50% with increased profitability while expanding the organization to 25 project managers and engineers in the US and Europe. He was responsible for initiatives optimizing $9 billion of revenue for Fortune Global 1000 companies generating $400 million in profit improvement.
In this episode, Karl shares how pricing is done in the spirits industry taking into consideration the end retailers and distributors’ margin goal.
“If you want to really push pricing all the way through and make it hit your bottom line, work and coordinate across all players that are relevant for that decision.”
- Karl Petersson
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:18 - Karl’s journey into Pricing.
02:45 - How pricing looks like in the spirits industry? Do they sell through a distributor?
04:06 - How is pricing done at the consumer level, at the grocery store or at a nightclub?
05:03 - Thoughts on treating the grocery stores and end-retailers as customers, Bacardi as a loss leader
08:02 - What dictates the volume produced?
08:30 - How do they get to influence pricing beyond the distributor
12:06 - Bacardi’s pricing strategy as they work with their retailers taking into consideration the competitors
13:57 - What’s interesting to know about the spirits industry when it comes to raising prices?
15:01 - Can they set prices and sell directly to consumers in other countries other than the US?
16:10 - How do they work with distributors on pricing when they have a margin to meet?
19:07 - Taking a look at nightclub pricing
21:13 - Do you pay for shelf space in an outlet if you are trying to build your brand?
22:14 - Does it make sense to use price endings for drinks?
23:49 - His pricing advice that would impact other people’s business
24:33 - Does size matter when it comes to pricing when coordinating with other concerned players?
Key Takeaways:
“An interesting part of the negotiation is do you have a brand that's strong enough to make a chain compress on their own margin just to get that hot price point?” - Karl Petersson
“In Europe, you can set the pricing to your customers, so you don't have to sell for that distributor tier. You can go and sell directly to your customers, groceries, nightclubs, etc.” - Karl Petersson
“Pricing with nightclubs, you will be bucketed on-premise on nightclubs, hotels, restaurants, bars. And for those accounts, you will see some interesting stuff like it's not only about the price, and that comes with a super low acquisition cost, and then someone buying a ton based upon it.” - Karl Petersson
“When it comes to coordinating pricing with different channels it's not that you're a small company, it's just that you might have a brand that doesn't have a lot of value. That will change the kind of negotiation you can do.” - Karl Petersson
Connect with Karl Petersson:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast:
- Discover the 5-step to innovation storytelling method which enables transformation
- Find out one important part aspect of an innovation story that causes people to connect and act
- Find out what our standard should be when we want to use innovation to produce transformation and action
Susan Lindner is a Cultural Anthropologist, Brand Marketer, and Disruptor. She believes incredible connections change the world. She is the founder of Emerging Media, an innovation communications consultancy dedicated to helping innovators and disruptors create stories, to get them the resources, runway, and recognition they deserve.
In this episode, Susan shares how the transforming power of innovation storytelling creates an impactful change and disruption to your business. Susan gives leaders a blueprint for creating their own stories that offer a vision, message, and path all stakeholders can follow with religious zeal.
“Poll your customers and find out why they love you and why they can't live without you. And then charge double.”
- Susan Lindner
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:40 - What her company, Emerging Media, is all about
02:47 - What do we expect from an innovation story
05:27 - How should innovation story impact the world
06:57 - Why the idea of innovation story takes a while to saturate into one’s awareness
08:02 - The challenges innovation story faces
09:08 - How does storytelling differ in B2C versus B2B
11:21 - Sharing the 5 steps to innovation story
18:05 - Relating an example on how to fully take advantage of innovation storytelling
21:28 - What bar are we setting when we bring innovation to a room?
23:09 - Humans connect at drama and pain
25:52 - What is her passion in life
26:19 - Sharing pricing advice to give a big impact on your business
Key Takeaways:
“The human brain understands information via story.” - Susan Lindner
“Anything that you have learned over the course of your lifetime, chances are you've learned it via story unless you've experienced it directly. And even if that were the case, someone probably described it to you before you ever experienced it.” - Susan Lindner
“Our expectation these days around innovation is transformation. We want to know that our lives are made better by this thing that you're bringing into the world.” - Susan Lindner
“We want to know the pain incurred because human beings connect at the pain, not at winning. That is the biggest mistake. We can revel in celebration together but humans connect at drama and pain.” - Susan Lindner
“A founder’s story is the beginning of the prophet’s story. I want to believe that what you have done has transformed you first.” - Susan Lindner
Resources Mentioned:
- Schedule a FREE 30-minute innovation storytelling consultation Susan Lindner. Click here: ScheduleSusan.com
- Her new book coming up this September: Innovation Storytelling - Get the Resources, Runway, and Recognition you Deserve by Susan Lindner
- Jesus
- Buddha
-
Muhammad
-
Luke Skywalker
- Joseph Campbell
Connect With Susan Lindner:
-
SusanLindner.com
-
LinkedIn
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast:
- Find out why you need to price test, even after making the effort to understand value through all the analytics available
- Learn how to consistently deliver substantial lifts in revenue and profit through pricing
- Learn about the social science of pricing: utilizing the best of data science, artificial intelligence, and the psychological behaviors of consumers, to maximize your long-term profit
Ammanuel Selameab has spent 7+ years in pricing and can’t imagine what else he’d rather do. His work has taken him across both B2B and B2C contexts, supporting companies like Enbridge Energy, Cargill, Omnicom, Old Navy, and Shutterfly. He is the Pricing Head at Carta and is the founder of Run Pricing Tests.
In this episode, Ammanuel shares how running pricing tests can help you generate long-term revenue and increase your market share.
Spend more than 30 seconds thinking about your pricing. It’s the most essential decision that you’ll make. It’s the most impactful decision that you’ll make and it deserves more of your attention.”
– Ammanuel Selameab
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com
Topics Covered:
01:17 - How Ammanuel’s pricing career began 02:29 - Where Ammanuel’s long-term aspirations lie
04:13 - How does a pricing role in a company gives you an edge over someone in accounting or sales
04:51 - How Ammanuel’s company came to be. Where does he find customers and what product does he offer
07:04 - How are tests structured to get desired results
09:18 - Talking about price segmentation and price discrimination
10:13 – What’s important point to know about price testing
11:30 - On dealing with data scarcity
12:21 - Explaining how decisions are probabilistic, and the best way of supporting those decisions
14:15 - Viewing what they do in pricing as a social science 15:10 - How does the engagement of price testing take place in a company with a direct sales force
18:37 - What kinds of companies do they offer their services to, and how many salespeople are working for them
20:25 - One large test success they have had so far
20:54 - Are there negative impacts with tests
22:30 - After all the efforts to understand value, and all the analytics available, why go and test it
23:14 – His best pricing advice to make a big impact on your business
Key Takeaways:
“Because pricing initiatives almost always are cross-functional in nature, you’re exposing yourself to many different functional areas. In terms of your capacity to lead, you now have a much broader perspective on the business than someone perhaps exclusively in accounting or sales might not be privy to.” – Ammanuel Selameab
“The business that I built is around taking pricing hypotheses and going to market and testing their viability.” – Ammanuel Selameab
“Even if we don’t achieve stats sig, any amount of data we can provide you to inform your pricing decisions is a good thing.” – Ammanuel Selameab
“Going to the market, doing the work for companies of testing and vetting out ideas, is the best way of supporting data.” – Ammanuel Selameab
Resources Mentioned:
- Van Westendorp’s Price Sensitivity Meter
Connect With Ammanuel Selameab:
- RunPricingTests.com
- E: ammanuel@runpricingtests.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast:
- Learn about the key rules on negotiation to help you carry out your winning strategies
- Learn about the winning idea of concessions that you can apply in negotiation
- Learn how to meet the needs and wants of stakeholders who are coming from different perspectives to foster value-driven conversation
Mark Raffan is a lover of negotiation, marketing, and behavioral science. Over the last few years, he started and grown c Podcast to be the #1 negotiation podcast in the world.
In this episode, Mark shares his insights about the negative viewpoints around procurement and how to close winning deals through value-driven negotiation. Learn about the negotiation skills and strategies necessary for you to execute your action plan.
“Always ask for more than you expect to get.”– Mark Raffan
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!To sign up go to insider.championsofvalue.com.
Topics Covered:
01:23 – From a sales and procurement background, one thing led to another and finally to negotiation. That’s how Mark would describe his journey towards negotiation.
03:29 – If it is a way to make you believe a certain thing that isn’t necessarily true, but not saying a lie, then you’re just being psychologically conditioned to believe one thing. This is in defense of the procurement guys.
06:26 – Sales and procurement are coming into an antagonistic viewpoint of each other. This doesn’t help in reaching a value-driven conversation.
08:49 – Mark’s thoughts on the zero-sum game of pricing.
09:28 – The more that we can just have rational, normal conversations, I think it’s just going to be better for everyone. Mark’s idea of getting an alignment where sales and procurement are concerned
11:33 – People’s misconception about negotiation is that you can’t ask. Mark clears that up.
12:15 – There is ego involved in not asking. This is the reason why negotiation fails.
14:33 – What is expected of negotiations – making sure that someone feels actually good about the negotiation, making everyone believe that you’re meeting those needs and wants for every discussion.
15:55 – What a value-based conversation should be – asking why?
17:14 – Patience wins. How Mark agreed to that
17:31 – Don’t let your CEO negotiate. Mark states his agreement to that
18:02 – If you give something, you get to get something. Giving his thoughts about the idea of concessions
21:14 – Shut your mouth. This is one great negotiation tip Mark shares
22:29 – Mark’s piece of advice – Plan. Doing strategy work and research will help in your success.
23:23 – Why do the planning? Understanding the value on the other side of the table helps you execute those strategies
24:53 – Sharing his best pricing advice
25:26 – What is it that Mark convinced Mark Stiving about?
Key Takeaways:
“We have different needs and wants. And so obviously you have to try and meet those needs and wants for every discussion. Or make the person believe that you’re meeting those needs and wants for every discussion.” – Mark Raffan
“You should never be doing a one-way concession and you should never be committing to a concession before getting a commitment in return.” – Mark Raffan
“So many of us go into a negotiation negotiating with ourselves before we even go in. We think that we’re going to be asking for too much.” – Mark Raffan “There’s got to be some additional reasons why you want the sale. And the reason that you do the planning is to build up the strategy so that you can get those reasons executed.” – Mark Raffan
Resources Mentioned:
- Storynomics: Story-Driven Marketing in the Post-Advertising World by Robert Mckee
Connect With Mark Raffan:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Discover why value-based pricing is the most neglected step in understanding price
-
Learn how to communicate product value in value conversations with customers before products are made for better pricing
-
Find out the importance of having a pricing strategy to determine a product’s value
Stephan Liozu is the Founder of Value Innoruption Advisors, a boutique consulting firm specializing in disruptive approaches in value, pricing, and strategic management. He helps leaders in organizations that want to get started in pricing by conducting assessments and building road maps.
In this episode, learn all about value pricing and how to use the right pricing toolbox to come up with a price based on how much a customer believes a product is worth.
“Critical problems are around value. Pricing comes later.”
- Stephan Liozu
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Topics Covered:
01:01 - How Stephan got into Pricing: having been named ACP deployment officer for Owens Corning Europe taking care of the pricing module in SAP
02:37 - The role of a chief value officer: Being the chief conductor of all the value and pricing activity in an organization.
05:50 - The whole process of measuring value, creating, and capturing it using the dollarization methodology
07:39 - Going through value creation: looking at the customer problem, do a better job of understanding the customer problem, uncovering it through market research, insights, and ethnographic research
09:14 - ‘99% of businesses are there to create value, oftentimes they don't know what value really means.’ Stephan's thoughts on it.
13:40 - Conversations put your customers at ease. Stephan's perspective about value conversation and the challenge that goes with it.
16:30 - Why do companies don't understand what product value is? Stephan states the three reasons why.
17:58 - Why is it important to ask the right questions?
19:18 - Customer segmentation is an often neglected part of a value conversation. Another reason why companies don't think about value.
19:54 - What Stephan is up to these days: leveraging technology to a lot of his work focusing on monetization of software and data.
21:03 - Hardware product companies are giving away the software as a way to sell their hardware. We hear Stephan's idea about it.
22:32 - Talking about cost and value in SaaS companies. The challenge of communicating the value of its product.
24:49 - He couldn't care less about focusing more on the value of a product. His one pricing advice that could impact your business.
Key Takeaways:
“Our competitors are also looking at the customer problem. So we got to do a better job at understanding the customer problem, uncovering it through market research, insights, ethnographic research.” - Stephan Liozu
“I wanted not to be a CPO chief pricing officer, I wanted to be a CVO chief value officer, because our critical problems are around value, you know, pricing comes later.” - Stephan Liozu
“Psychologically it puts your customers at ease when you have a conversation, whether it's in creation mode, in quantification, validation, and communication.” - Stephan Liozu
“To be doing the work in value, you have to have value conversations.” - Stephan Liozu
“If we have to continue doing everything in finance around the product, then we're not going to achieve our goal to show the value of everything else we do in the bundle.” - Stephan Liozu
People Mentioned:
- Ron Baker
Connect With Stephan Liozu:
- stephanliozu.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn how to communicate value to your customers so they get what they want, and you protect your own position in terms of profit and margin
- Discover how to strategically negotiate to win a sale at a higher price
- Find out why lowering costs and increasing value doesn’t need to be a trade-off
Andrew Bailey is a Value Pricing and Price Negotiation Specialist. He is the founder of Commercial Strategy 4. He helps you unleash your pricing power to sell more, more often, and at a higher price to achieve the profits you deserve.
In this episode, Andrew shares strategic ways to communicate your product’s value through value selling.
“The value selling journey is about understanding what the customer perceives as value.”
- Andrew Bailey
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Topics Covered:
01:27 - How Andrew got into pricing: a discovery: focusing on pricing and margins is a much more powerful way to maintain and grow profits, than starting the year with a big sales gap to fill
02:45 - What keeps him in pricing: taking people through the journey of realization to more fulfillment in their business
04:40 - Expounding on what selling value means: Getting focused on what this looks like, what they really do for people and quantifying that, so they really get a great fix on what drives value for their customers and how they can help their customers by delivering value
05:27 - Andrew’s thoughts about value when creating new products or new features: go back to the pricing term, willingness to pay; what we've got to try and do is get the customer in the position where they're willing to pay for outcomes in a fair way, so we get what we want in return for what we’re going to do for them
06:50 - How Andrew communicates the value selling element of a product to win big deals and prices - what I do is backtrack and cover off some of the fundamentals. And so go back to something around the product and what it's delivering
08:19 - Most companies don’t know about their products’ value, hence the lack of value perception. Andrew relates further to what it’s like working with clients who have this challenge
09:26 - How can I get my value across to them? Andrew’s idea of a value conversation explained
12:28 - One of the things they developed in the business is what is called a sweet spot type approach, learn how a company can apply this to get better at negotiation
13:56 - When it comes to negotiation, who do the salespeople talk to? Is it the decision-makers alone?
16:04 - Getting all the stakeholders on the customers’ side together for a value conversation is his idea of how a negotiation happens. Because to Andrew, that is easier in order to win a sale at a high price.
22:30 - Andrew believes the only way we really find out what people are interested in is when we ask questions and listen to them.
24:08 - His thoughts on Mark’s negotiation rule number one: Patience wins.
25:03 - Adhering to rule number two: Never let the CEO negotiate.
26:07 - You don't give anything unless you get something in return. To Andrew, it is important that what you give is valuable to the other person, but that it still preserves your own position.
Key Takeaways:
“Value selling is taking the customer through a journey or a process, just understanding the value of what they do, and the results and the outcomes they can deliver for their customers.” - Andrew Bailey
“Value conversation is a collaborative process that you go through that can uncover more of the value you can deliver, and the value there is for customers to capture, which is ultimately what they want.” - Andrew Bailey
“Negotiating is there to help you secure and protect the value you're delivering to customers that you're going to get through your price.” - Andrew Bailey
“In negotiation, people need to just be more open, ask straightforward questions to sit down the first time, and just say, which do you prefer?” - Andrew Bailey
Resources Mentioned:
- "The 7 biggest mistakes people unwittingly make when negotiating and how to avoid them" by Andrew Bailey
Connect With Andrew Bailey:
- commercialstrategy4.co.uk
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn about what a CPQ is and the value it gives to a company
- Find out how to bundle products together to cater to a customer’s specific needs
- Learn how to achieve price optimization through the use of CPQ
Steve Wilkins is the Head of Pricing Solutions at Standav Corp, a seasoned executive with many years of experience advising senior management teams on revenue growth, new business model development, pricing strategy, data preparation and cleaning, price and revenue management, commercial excellence, change management, profitability improvement, and business transformation.
In this episode, Steve talks about his experience working with pricing-focused CPQ companies, how CPQ helps in bundling products together, how pricing optimization is attained with the use of CPQ, and much more.
“Pricing is a journey. It's not a sprint. So take it in steps. Don't think that you have to go for that end-goal right away.”
- Steve Wilkin
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Topics Covered:
01:37 - Dealing with a lawsuit is the last thing you want to have. But interestingly, it's how Steve started his pricing career.
03:06 - What is a CPQ and what is a pricing system? How do they differ from each other?
03:55 - What does a configured product look like? Steve gives an example.
05:26 - Manufacturers with customizable products can use CPQ. How can they bundle products?
06:28 - What is so important about CPQ systems? What benefit do you get for buying a CPQ system for your company?
08:12 - What about time to quote? What big of a deal is it about?
11:56 - Pricing systems consider different factors, and when you add this to different configurations of products it gets complicated. Let's hear Steve's thoughts about it.
13:13 - What is Standav and what does it do? What differentiates it from other implementer companies?
14:23 - Data cleaning is one of the tools Standav offers. What goes on in this process?
15:18 - Dealing with master data management. How does Standav solve the problem of bad data?
Key Takeaways:
“With CPQ you're providing a single source for putting multiple things together.” - Steve Wilkins
“Right now they all integrate into a CPQ to provide the more relevant price or winning price that's going to help speed the process up. So that's where you're going to hear that story of, I can get this through quicker, win more deals at the best price. - Steve Wilkins
“I believe in the idea of getting the data ready, fixing the problem that caused the data to be bad. And then building that integration into it, is it a pricing system, a CPQ system, a CRM system, we build that.” - Steve Wilkins
People and Resources Mentioned:
- Frank Sohn
- PROS
- Apttus
- Salesforce
- Zilliant
- Price f(x)
- Dell Computer
Connect with Steve Wilkins:
- E: steven.wilkins@standav.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Discover how to develop a pricing strategy that leverage the value your organization creates
- Learn how to execute pricing actions to drive commercial outcomes and growth
- Discover how to use pricing tools to create and transform pricing that supports your business model
Pricing is where it all comes together, says Steven Forth - co-founder of Ibbaka the leading platform to price and differentiate for the client’s market.
In this episode. Steven shares how he helps companies redefine their value, as well as how they price offerings in the marketplace through a combined deep understanding of pricing design with market segmentation and value creation.
“Segment your customers based on value. You need to understand what your value drivers are.”
- Steven Forth
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Topics Covered:
01:24 - Backstory of how Steven started his pricing career: How sitting down with Tom Nagle and reading his book was a turning point in Steven’s career
03:56 - Pricing being an indicator and diagnostic tool in business
05:00 - With new trends coming up in the market, Steven shares what he is seeing as happening in Pricing these days and his insights about it
06:32 - Pricing and one's willingness to pay
08:05 - As there are different views about value-based pricing, Steven shares what value-based pricing means to him
11:42 - Some companies say they have a problem with pricing, but after digging deeper they actually have a value problem. Steven expounds on this
16:02 - Pricing optimization is based on available data around. How do B2B and B2C differ when it comes to available data to utilize
16:02 - As B2C obtains more data than B2B, how do these two differ in terms of value-based pricing and dynamic pricing
19:31 - Steven expounds on conventional economic theory and how it relates to price elasticity of the demand curve
22:28 - Where does value-based pricing tie into outcomes-based pricing
26:21 - Talking about pricing power. Who has the most pricing power?
28:21 - Why do you need to have a deep understanding of value when it comes to executing outcomes-based pricing
30:35 - Steven discusses the importance of different economic value drivers and emotional value drivers especially where medical companies are concerned
Key Takeaways:
“Pricing is a great indicator and diagnostic tool. It lets you explore so many different parts of the business.”- Steven Forth
“Dynamic pricing has always been how commodities are priced. Markets are dynamic pricing. That's what they are. And we've learned how to make the algorithmic and apply artificial intelligence and machine learning to it.” - Steven Forth
“Willingness to pay is an outcome. It's what you're trying to shape. Framing pricing around willingness to pay, and doing analytics to estimate willingness to pay, I think is actually a way to sub-optimize your pricing outcomes.” - Steven Forth
“Value-based pricing for me is an understanding of the economic, emotional, and community value that your offer creates compared to the alternatives.” - Steven Forth
“Whoever takes on the most risk has the most pricing power. The seller’s ability to predict value outcomes should be more powerful than the buyers. Therefore the seller should be willing to take on more risk.” - Steven Forth
People and Resources Mentioned:
- The Strategy and Tactics of Pricing by Thomas Nagle
- William Gibson
Connect With Steven Forth:
- Ibbaka.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn about the dynamic pricing engine and its impact in making data-driven pricing decisions
- Learn about the pricing elements that are crucial in making an informed pricing decision
- Understand why in as much as data-driven decision-making helps companies, a product’s value must also be considered in pricing
Price monitoring software is becoming more and more accessible to all levels of markets such as SMEs and startups. Burch says it's not an excuse to invest in such technologies since they are no longer expensive for enterprise players.
Burc Tanir is the CEO of Prisync - a company that helps e-commerce companies automatically track their competitor prices and dynamically price their products deliberately.
In this episode, Burc shares his insights on why pricing is critical to e-commerce success, and why analyzing your competitors’ prices manually is laborious. He gives emphasis that focusing on adding value to your product and working on your market positioning is more important to any e-commerce business.
“Every market and every player in the market has its competition to a varying degree. I will always encourage those people to find automated and dynamic ways to monitor competition, regardless of scale, at least incorporate some degree of data-driven decision making.”
- Burc Tanir
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Topics Covered:
01:36 - E-commerce companies doing manual work of benchmarking their product prices. It occurred to Burc the need to automate so that paved Burc Tanir’s way into pricing
03:25 - Web scraping of pricing data used to be hard. What made it possible for Burc to have a wide database of online retail stores
05:22 - Manufacturers face the challenge of putting their prices on webpages as they operate through distribution channels and retailers. The technology that Burc developed helps benchmark what manufacturing businesses sell
06:53 - Three elements of pricing puzzle: product matching, price scraping, and product optimization. Key points for decision making.
09:17 - What dynamic pricing engine is all about. How this rule-based pricing for small and medium-sized companies helps them reach their pricing goal
11:42 - How to avoid ratcheting up prices and ridiculous price points?
14:29 - Basically, Burc built his company by looking at what problem needs to be solved in the e-commerce industry. Why did he focus on e-commerce and what does he see changing in it these days?
17:33 - While data-driven decisions are helping companies, non-data driven decisions like understanding a product's value should also be a major consideration in pricing. Burc expounds on this.
19:17 - Using data-driven software does not always mean pricing low, it means raising prices the smart way to maximize profitability.
20:05 - Burc sharing his valuable pricing advice that could impact your business.
Key Takeaways:
“Our dynamic pricing engine was primarily designed for most small and medium-sized businesses. We went after a strategy which includes giving our clients the flexibility of setting price rules.” - Burc Tanir
“E-commerce will exist so it's the right market to stick with. I always wanted to find something sustainable. There will always be a price point for a product, pricing will never disappear.” - Burc Tanir
“We don't claim to follow the pricing puzzle end to end, we tell companies to not waste their time analyzing prices because that's a robotic thing. Just focus on your value, your market positioning.” - Burc Tanir
“Most think that we would always bring their prices down. But in the most profitable cases, we commend clients to increase their prices smartly.” - Burc Tanir
Connect With Burc Tanir:
- Prisync.com
- E:burctanir@prisync.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Discover why should a law firm hire a pricing person, the impact that pricing had on a firm’s bottom line, the benefits of having those types of roles in place
- How to go beyond the hourly rate fees for service professional
- Learn the array of ‘in the trenches’ perspective on how service professional firms can price smarter
Stuart Dodds is a sought after speaker, pricing and project management expert, and author of Smarter Pricing, Smarter Profit, and Pricing On the Front Line, both published by the American Bar Association.
Stuart was one of the first and longest-serving pricing and legal project management directors in the legal industry, first with Linklaters and most recently with Baker McKenzie.
In this episode, Stuart addresses the key pricing challenges encountered by services whether within a law firm or a law department. He also shares he helps professional firms in having targeted pricing, negotiation, and project management support resulting in its increase in the bottom line.
“[In terms of giving discount] Don’t negotiate at five and zero. ”
— Stuart Dodds
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
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Use the promo code ‘INSIDERNOW’ to take advantage of our special $5 offer for the first month.
Topics Covered:
01:34 — Flipping skills: starting in procurement then shifting to pricing: a backstory of how Stuart Dodds started in pricing.
03:00 — Why would a law firm hire a pricing person, the impact pricing has on a firm’s bottom line; “organizations were seeing a benefit from having those types of roles in place”.
04:24 — How to price professional services.
07:46 — The concept of ‘Will I, Which One’: the distinction between ‘is it competitive on price, or is there a competitor for something else?’
09:33 — Identifying “Why is it them [the law firm]? What's their differentiator? What's our value add?” And incorporating the fee they charge.
11:37 — Digging deep into hourly billing versus project pricing or solution pricing.
12:24 — Big question as a professional: ‘How certain am I that I know the solution to the problem?’
15:15 — Value-based messaging and the personal relationship with clients: Why changing the nature of the conversation is important.
19:59 — Procurement as a challenge to a customer-provider relationship, types of procurement.
24:55 — Stuart’s pricing advice: “‘[In terms of giving discount] Don't negotiate at five and zero.”
Key Takeaways:
“There's a tendency to still go back to the hourly rate, and not explore different ways of delivering better value to clients, and not actually getting better pricing and better profitability.” — Stuart Dodds
“The challenge is that ultimately they’re typically not listening to the (client’s) answers, or they're not asking the right questions.” — Stuart Dodds
“I think one of the challenges law firms are having at the moment is identifying, ’Why is it them? What's their differentiator? What's their value add? Why can’t they be charging more for certain services? And how should they best support delivery of the other, less differentiated services to their client base?’” — Stuart Dodds
People and Resources Mentioned:
- Ron Baker
- Baker McKenzie
Connect with Stuart Dodds:
- http://positivepricing.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn the step-by-step framework that helps product managers define, communicate, and drive their IoT product vision forward
- Identify costly blind spots in your IoT product pricing strategy
- Learn how to provide enough value that makes sense for the customer to adapt your IoT solution
Daniel Elizalde is an expert on all things IoT. He works as VP-Head of IoT at Ericsson. He’s helped train over a thousand product professionals at Stanford’s Continuing Studies program.
In this episode, Daniel shares how he helps product leaders create winning products and gain the skills they need to confidently and efficiently manage any IoT product.
“One of the challenges when defining value for IoT (Internet of Things) is having a clear understanding of who your customer is.”
– Daniel Elizalde
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code 'INSIDERNOW' to take advantage of our special $5 offer for the first month.
Topics Covered:
02:38 — Backstory of Daniel’s IoT career, starting from the era of telemetry to M2M to IoT and now becoming the most visible expert when it comes to IoT
04:07 — Daniel leading the area of thought leadership for Ericsson in IoT
05:23 — Daniel’s checklist: 12 Steps Every Product Leader Should Know to Create Profitable and Scalable IoT Products
07:05 — Complexities in developing IoT products
08:39 — Business model defined - a way of collect, deliver and collect value from your customers
09:13 — How IoT opens the door for new business models and innovation for companies
09:50 — If you're able to monitor your product, 24/7 in the field, how can you actually leverage that to provide new and innovative ways of monetizing and adding value?
11:44 — If it is a subscription per se, how can you make sure that you continue to add value to your customer
12:28 — Understanding the true Capex of IoT
14:09 — How Daniel coach companies to think about how to charge for hardware upfront
14:34 — What is going to reduce the friction on your customer site through business model experimentation
19:25 — Software companies struggle to figure out how to build-partner purchase, deliver-sell hardware being in a completely different ballgame
24:29 — Pricing challenges: how do you provide enough value that makes sense for the customer to adopt your IoT solution
Key Takeaways:
“The challenge with IoT is that to provide an end to end IoT solution, you have to put all those things together with the technical complexity that entails. But of course, with the pricing complexity, and the business model complexity, and they go-to-market complexity” — Daniel Elizalde
“Companies are starting to figure out that this is so complex that you can't just put something together and launch it to market and hope it sticks. You have to do your homework from a product management perspective.” — Daniel Elizalde
“That's the value of product management and IoT strategy is, hopefully, you can be two, three steps ahead and have some inkling that it will be worth it before you commit to building something like this.”— Daniel Elizalde
“IoT opens the door for new business models and innovation for companies.” — Daniel Elizalde
“The role of a product management team here is to figure out understanding the complexities of IoT and then being able to model different approaches and test them with the customers. There's no one size fits all.” — Daniel Elizalde
“Sometimes figuring out that your competition IP, not all other types of similar solutions, but just what are the other alternatives that the customer can realistically do for less money.“ — Daniel Elizalde
Resources:
- Ericcson
Connect with Daniel Elizalde:
- https://danielelizalde.com/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Discover how to use data science techniques to reduce churn in subscription services
- Learn how to create a churn dataset as benchmark metrics for subscription economy decisions
- Learn what is predictive of churn, and what can be done to reduce it
Carl Gold is the Chief Data Scientist at Zuora where he created the Subscription Economy Index™ and the data science behind Zuora's Subscriber Insights. He has a Ph.D. from the California Institute of Technology and has authored publications on Machine Learning and Neuroscience. Before coming to Zuora, he spent most of his post-academic career as a quantitative analyst on Wall Street.
In this episode, Carl shares his insights about using data to increase subscriber engagement and reduce customer churn. He provides a clear overview of churn concepts, along with hands-on tricks and tips he has developed through years of experience analyzing subscriber behavior.
“The thing about churn is there is no one solution. If you think a customer is going to leave, the next question is ‘why’.”
- Carl Gold
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Use the promo code 'INSIDERNOW' to take advantage of our special $5 offer for the first month.
Topics Covered:
02:18 — Backstory of Carl’s career, the stint he had at Wall Street finance industry being a quant and eventually becoming a data scientist
04:40 — The similarities of a quant and a data scientist, what they do. And the similarities of machine learning to data science
06:04 — All about subscription economy index and how companies use it
07:22 — The biggest challenge a subscription company faces when it comes to billing and where does Zuora come in to help
10:03 — Carl addressing the bias dealing with index and metrics
11:23 — Carl's thoughts on subscription companies being recession-proof than traditional companies
15:50 — Book alert: "Fighting Churn with Data" by Carl Gold - what is it all about
23:19 — How to convert leads to customers by looking at a buyers' journey and sequences of action leading to conversion or churn
29:20 — Carl's best pricing advice to listeners that could have a big impact on their business
Key Takeaways:
“If you can't bill people correctly then you know, what's your pricing plan good for?” - Carl Gold
“Some subscription companies are probably seeing boom times because if it's a product that people can enjoy and consume more of when they're confined to their home. Demand is supposed to be through the roof right now and they're struggling to keep up.” - Carl Gold
“If you want to reduce churn in a meaningful way, you have to give people more value.” - Carl Gold
“One of the most valuable metrics that you can ever make for a subscription business is the recurring unit cost that the customer pays. That is one of the most important churns and retention indicators that will give you your amazing insight into the value that customers are getting.” - Carl Gold
Resources:
- Fighting Churn With Data by Carl Gold
- Zuora
- Zoom
Connect with Carl Gold:
- fightchurnwithdata.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Understanding why continually aligning your pricing to what customers’ value is a never-ending journey
- Discover the importance of knowing what appeals to the customer and how they perceive your price when optimizing your price and value offer
- Learn how to leverage AI-powered pricing strategies to take your customer engagement to the next level
Valerie Howard is the Solution Strategy Director at PROS. She manages the go-to-market strategy for the PROS pricing solution portfolio.
In this episode, Valerie shares her insights on how to use data science to optimize price in today’s world of personalization and digital selling, how to leverage the benefits of Artificial Intelligence (AI), and why knowing what appeals to the customer and how they perceive a price is as important as the price itself.
“When it comes to pricing, we've got to constantly invest in that. There's no end goal there, it's a constant journey of evolution to continually aligning your pricing to what customers’ value and a better understanding of what they value.”
- Valerie Howard
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Use the promo code 'INSIDERNOW' to take advantage of our special $5 offer for the first month.
Topics Covered:
02:36 — Backstory of how Valerie got into pricing and the socio-economic behavior lessons related to pricing she learned while working with Continental Airlines
04:35 — What she does at PROS, how she manages the pricing solution portfolio of their airline clients
08:00 — How does cross-selling work with the solution that PROS offers
08:47 — All about price optimization and price governance: How this helps in the price execution across all channels and regions for PROS airline clients
09:56 — Personalization and Digital Selling defined: how they differ from each other
15:11 — The infrastructures of digital selling
18:59 — All about dynamic pricing and how it works
20:46 — Valerie on the importance of knowing what appeals to the customer and how they perceive your price when optimizing your price and value offer
22:35 — Where do price segmentation and dynamic pricing come into play with regards to a speaker's of ‘fee integrity’
23:26 — Discussion around price variation and price segmentation techniques in the medical service industry
Key Takeaways:
“When it comes to personalization, I think what we always hear is that customers really want their buyers to understand them, really want to understand their needs at a personalized level. I think pricing gives us a unique way to better understand, ‘Do they really value this?’ Because if they’re not willing to pay for it, then maybe, it is not something they are valuing so much.” - Valerie Howard
“When it comes to digital selling, there is a relationship to personalization there, too. It's easier for us to purchase in a self-served way. What are the different ways businesses are tuning in to their customers and making it easier for them to purchase? -- It’s by understanding them so well that they don’t even have to be present and don’t have a sales rep holding their hand through the whole purchase process.” - Valerie Howard
Resources:
- PROS
- Continental Airlines
- Hanover Research
Connect with Valerie Howard:
- E: vhoward@pros.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn about price gouging as a functional price management strategy
- Discover the importance of value differentiation relative to pricing and market segmentation in turbulent times
- Pricing strategies that you must consider at this time of crisis to keep up with your competitors
Lydia DiLiello is the CEO and founder of Capital Pricing Consultants, an expert model revenue management and business consultancy dedicated to sustainably improving revenue and profitability for its clients through relevant and timely insights, strategic plans and targeted training programs.
In this episode, Lydia shares her insights on how to manage your pricing during a crisis, how to keep up with competitors to maintain market share, and why a crisis management plan is important in such times of downturn.
“Determine what the single most important thing is that they want out of a business every year, one thing, and then make everything else drive back to it from a strategic standpoint.”
- Lydia DiLiello
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code 'INSIDERNOW' to take advantage of our special $5 offer for the first month.
Topics Covered:
01:17 — Lydia’s backstory how she got into Pricing
05:53 — Price gouging as a functional price management strategy
07:28 — Pricing advice for companies, how to keep your business going in the hard times
09:20 — How to manage manpower layoffs during the crisis: e.g. If you are a restaurant and all you’re allowed to do is a curbside delivery, would you lay off your waitresses and waiters?
10:58 — Lydia’s thoughts on lowering your price to maintain your market share
12:14 — Why discounting shouldn’t be your standard operating policy relative to your pricing strategy
15:50 — Thoughts about competitors lowering their prices at this turbulent economic condition
17:21 — All about market segmentation relative to pricing and value
18:33 — All about having a crisis management plan: How should management react, prepare, and pivoting during a crisis
22:16 — Best pricing advice Lydia has for the listeners
Key Takeaways:
“Companies that are making decisions based upon the welfare of their employees are going to end up in a stronger place just to brand loyalty and recognition.” — Lydia DiLiello
“If there are things that require labor and you have the resources to do it, get it done now, keep your people employed because it puts you in a stronger position when this finishes to come out ahead.” — Lydia DiLiello
“I believe that’s not a good thing to do, lower your prices just to keep going. I think they should not do that, and I feel strongly about that because what it does is it devalues their brand.” — Lydia DiLiello
“I think that brand advertising is all the more important. Continue to sell it at what it sold before the crisis or find ways to run co-specials where you’re not changing your base price. That base price remains but maybe now it’s buying one get the second half off for a short period of time, but don’t readjust that base price.” — Lydia DiLiello
“Change your value offering as fast as you possibly can. If you change your value offering, it takes six months for the competition to keep taking that business. Less and less price. They’ll gain the market share. But eventually, your good customers will see the difference in your products. And if you really do have value and product differentiation, they’ll come back to you.” — Lydia DiLiello
Resources / Links:
- Jim Tressel
- General Motors
- Procter and Gamble
Connect with Lydia DiLiello:
- E: lydia@capitalpricingconsultants.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Find out how to achieve greater financial independence through Amazon selling
- Learn how to choose the right Amazon business model
- Learn how to sell on Amazon and achieve greater financial independence
Carlos Alvarez is an Amazon Marketing Consultant and Teacher. He is the CEO of Blue Bird Marketing Solutions and Founder of Wizards of Amazon.
Twelve years ago, he took the “plunge” and decided to sell full time on Amazon, didn't know he would create, let alone grow his brands into nine figures a year in gross revenues. And nine years ago he had no idea his love for online selling would be rivaled only by his passion for digital marketing.
In this episode, Carlos shares his mission to empower brands to take advantage of selling on Amazon as well as help entrepreneurs break the shackles of their nine to fives and achieve greater financial independence through Amazon and digital marketing.
“Merch is probably one of the newest, most attractive models that Amazon has. I don't believe anything is ‘get rich quick’, but this has to be the closest thing to a money tree in Amazon that I've seen.”
- Carlos Alvarez
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code ‘INSIDERNOW’ to take advantage of our special $5 offer for the first month.
Topics Covered:
01:55 - What are the different business models he teaches on how to play or compete in Amazon
03:08 - What is a Private Label business model
06:52 - How do you take off what you sell on Amazon platform to your own platform
09:10 - What is a Resale Business and how does it differ from Private Label
10:53 - What is Amazon FBA?
13:33 - What is an arbitrage business model
15:01 - What is the pricing and value consideration of an arbitrage model
15:56 - What is Merch by Amazon and why it is considered as the money tree in Amazon
19:18 - What is Self-Publishing business channel and how does it work
23:47 - What is a good thing about Kindle in Amazon
24:51 - What is Carlos' business and how does he make money
25:53 - Carlos' best pricing advice
Key Takeaways:
“Merch is very exciting! I don't treat it like a business. And if I did, it would just make so much more. I have this really as a side thing on Amazon, but the revenues that it makes, and if you did treat it like a business and you dedicate some to it, it can be a lot more attractive than even what I said.” - Carlos Alvarez
“Buy low, sell high.” - Carlos Alvarez
“Depending on your business model, you can sell your Kindle books for free. How does that work? What happens is when someone downloads your book and they're much more likely to download it and take a risk on it, when it's free. Amazon's gonna pay you a royalty for that download and the amount of pages consumed. So it can be a very lucrative model and everyone feels like they won. Well, so with Kindle you can add links. So you can do a form of lead gen there, send people to a landing page, your YouTube to your podcast.” - Carlos Alvarez
Resources / Links:
- GoDaddy
- Amazon
- eBay
- Alexa
- Target.com
- Walmart
Connect with Carlos Alvarez:
- E:carlos@bluebirdmarketingsolutions.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you should check out today’s podcast:
- Find out the basic differences between SaaS, subscription and traditional perpetual licenses
- Learn about subscription pricing decision and how to set-up the revenue buckets for acquisition, retention, and monetization
- Discover why it is important that your pricing and packaging be aligned to the buyer journey
Amy Konary has more than 20 years of experience advising companies on subscription business strategies.
She is the founder and chair of The Subscribed Institute presented by Zuora, a think tank for the subscription economy. Through The Subscribed Institute Amy brings together a community of business executives, thought leaders, and industry experts at a series of Executive Summits and events, and generates research and industry benchmarks on subscription transformation topics. Amy also advises Zuora customers on subscription business strategy development, execution, and maturity.
In this episode, Amy talked about the strategies and different pricing models used to craft the revenue buckets for acquisition, retention and monetization of your subscription business.
"When you're selling a subscription, you have to take people on a journey."
- Amy Konary
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code ‘INSIDERNOW’ to take advantage of our special $5 offer for the first month.
Topics Covered:
02:14 - How she got started in Pricing
04:35 - Pricing and packaging in traditional businesses as compared with subscriptions
08:11 - What to focus on in subscriptions and the challenges that go with subscriptions
12:54 - Her thoughts on this particular difference between a traditional business and subscriptions
15:04 - Why consumption pricing isn't the most viable option in subscription pricing
15:54 - What is Subscribed Institute and what does it do
19:07 - Her best Pricing advice that would greatly impact your business
Key Takeaways:
"You're selling relationships when you're selling subscriptions." - Amy Konary
"All of the sorts of principles about how people make decisions and the balance of simplicity with flexibility and the paradox of choice, all these sorts of behavioral economic concepts seemed very, very strong when it comes to subscription pricing." - Amy Konary
"In subscription, rather than selling all the value upfront, you have to make sure they can see value really quickly and you'll also have to give them a path forward." - Amy Konary
"For a new business, you absolutely have to focus on new subscriber acquisition and that might dictate or it does dictate how you price and package." - Amy Konary
"In subscription, you can't monetize unless you have that relationship, have that subscriber." - Amy Konary
Resources:
- Subscribed: Why the Subscription Model Will Be Your Company's Future - and What to Do About It by Tien Tzuo
Connect With Amy Konary:
- E: akonary@zuora.com
Connect with Mark Stiving:
-
Email: mark@impactpricing.com
-
LinkedIn
Why you have to check out today’s podcast:
- Learn practical and sellable solutions transforming your clients from perpetual to subscription
- Know the challenges on shifting revenue model from perpetual to subscription
- Discover how to craft your pricing based on customer perceived value and what appeals to them
Scott Miller is a senior advisor, an active speaker in North America and Europe, workshop facilitator, and a leading global expert in B2B pricing with a specialization in B2B & B2G software pricing (both large enterprise and start-ups). He works as a consultant, trainer, and coach on the topics of product and marketing strategy, as well as pricing and offer design.
In this episode, Scott talks about his pricing framework in transforming companies from perpetual to subscription and the different nuances of pricing and monetization that go with it.
“Our world is becoming more about solution-based pricing where you have this combination of some hardware plus software plus some services. And so pricing teams are really struggling these days trying to figure out ’Well, how do I holistically price all of these components together?’”
– Scott Miller
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code ‘INSIDERNOW’ to take advantage of our special $5 offer for the first month.
Topics Covered:
01:16 – How Scott started in Pricing
03:07 – What is Software Pricing Framework
04:33 – Pricing as a process according to Scott
05:41 – The concept of transforming companies from perpetual licensing to subscription
07:20 – The hurdles SaaS companies have to deal with in transforming from perpetual to subscription
13:15 – How to set a successful pricing conversation with clients
16:17 – Handling clients objections about shifting from perpetual to subscription
14:33 – Strategies of migrating a client from perpetual to subscription
18:17 – The complexity of sales compensation when you go from perpetual to subscription
22:38 – The offer design process and the pricing metrics used when shifting from perpetual to subscription
27:29 – Scott’s pricing advice
Key Takeaways:
“Tell me how much we’re supposed to price a product and then we’ll know that it’s not about me being good at coming up with the price point or you coming up with a price point. It’s the process that you need to go through to come up with the right offer design.” – Scott Miller
“If you struggle articulating your value proposition then you’re going to struggle with the pricing strategy.” – Scott Miller
“As part of the process for offer design, when you’re thinking about, ‘How do I want to package our SaaS solution?’ One of the questions is going to be around. ‘What’s the right metrics that we want to use?’ The metrics that you want to have is it’s going be a good reflection of the value that your software delivers to a client.” – Scott Miller
“A lot of people do a lot of socialization internally and make sure everyone’s onboard, but we leave out that client part and that’s a really valuable piece of information that a lot of folks neglect.” – Scott Miller
Resources / People Mentioned:
- Spotify
- Netflix
Connect With Scott Miller:
- Miller-advisors.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you should check out today’s podcast:
- Know how to price yourself and services right
- Learn why billing by the hour is a disservice to you and your service
- Why you should you never underprice yourself and your services so no money is left in the table
Loren Fogelman is an expert in pricing strategy and sales for small business owners. Her passion is empowering accounting professionals and other entrepreneurs to double revenues by working half the time through strategic pricing and effective sales techniques.
Loren coaches service-based entrepreneurs to shift away from the trap of the “dollars-per-hour” business model to a value-based model that has, in some cases, allowed her clients to reduce workload by as much as 50% while doubling revenues.
In this episode, Loren shared about why most service-based entrepreneurs are underpricing themselves and how she helps them truly price based on value and how hourly-based pricing is not being fair to them and their clients.
“It's not one-set price unless you're looking at it from a subscription-based model, which is, it's really having what I call a value conversation where you're asking the client great questions and then you're pricing the client, not the service.”
- Loren Fogelman
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
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Use the promo code ‘INSIDERNOW’ to take advantage of our special $5 offer for the first month.
Topics Covered:
01:18 - How Loren got into Pricing
02:45 - What is "The Ultimate Pricing Bootcamp" and who is this for
05:54 - How to price an accountant's service or project offer
11:41 - Who are her target clients
12:02 - Who is her speaking clients and what type of clients are they
13:07 - Introverts versus extroverts
13:46 - Her best pricing advice
14:27 - Why do clients underprice themselves and how does she help solve their problem on this matter
Key Takeaways:
“What we want to do is recognize that the clients aren't buying their time. It's just that culturally they've been trained to ask what's your hourly rate? And also accounting professionals have been trained as employees to clock in and clock out for their services. That's not really the highest value, all their clients want to know is can you deliver on your promises and can I trust you to do that? That's really what they primarily want to do and the faster the better.” - Loren Fogelman
“We price it according to what the client values instead of what they value as the practitioner. And that is really the key piece is stepping into your client's shoes to understand how they view the value of what you offer instead of looking at it from where you are.” - Loren Fogelman
“What I would say is to understand that pricing is not what you think it is. The majority of professionals, from my research, 57% of the professionals actually underpriced their services. If you are trying to price it yourself, you're probably leaving money on the table.” - Loren Fogelman
“One of the things that I do with a lot of my clients, because they know that they undervalue themselves, is we'll get on a call together, I will review their packages. Maybe they have a proposal coming in and we will go ahead and create the packages and actually price it together because if it was left up to their own devices, they would base it off of their hourly rate and that's not really going to help them make more money without having to work harder.” - Loren Fogelman
People / Resources Mentioned:
- businesssuccesssolution.com/let'stalk
Connect With Loren Fogelman:
- Businesssuccesssolution.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Understand the behavioral economics of consumers in order to overcome barriers to their buying decisions
- How to overcome barriers of apathy, anxiety, and paralysis to get more people on board and encourage retention
- How to structure your offer in a way that it will be easy for customers to make buying decisions
Bri Williams is the Behavioral Explainer, Managing Director and Behavioural Specialist of People Patterns Pty Ltd. She works with clients to maximize each and every interaction using behavioral economics. That might include your proposals and presentations, letters and emails, websites and apps, product and brand development, sales and customer service scripts, stakeholder meetings and staff performance.
In this episode, Bri talks about the importance of behavioral economics in influencing people’s decision-making to buy.
“You cannot ‘not’ influence people. Anything you do in any direction, you are influencing people.”
- Bri Williams
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code 'INSIDERNOW' to take advantage of our special $5 offer for the first month.
Topics Covered:
01:07 - Bri's response to Mark’s Blog titled says, ’Why Behavioral Economics Doesn't Work with Subscriptions.’
02:31 - Behavioral techniques companies used for retention or expansion
04:21 - Why she calls herself a behavioral explainer
06:21 - The dichotomy of rational and irrational decision-making
09:19 - Three barriers businesses need to think through and overcome to onboard and retain customers
12:49 - Apathy as being the status quo
15:05 - Decision paralysis as a speech paradox of choice
17:06 - Anxiety being the third barrier to getting people to buy and the proven ways to overcome it
21:13 - Is behavioral economics a manipulation game? Is it good or bad?
25:11 - What's the idea behind behavioral economics
Key Takeaways:
“I agree the good, better, best is a really appropriate sort of structure to work on the cues. Like this is the bestseller or this is what most other people buy. The use of social proofing and social norms to perhaps suggest to people what the preferred option should be. When in doubt, people tend to do what other people do. So signal that to them.” - Bri Williams
“And this is what happens throughout our decision-making. We're playing tennis all the time. When there's nothing at stake to lose, we're going to be more aggressive. We're going to be more open to risk. But as soon as those stakes have changed, then we're going to withdraw a little. So as a business, we want people to feel very confident that if they take the desired action, it's going to be okay.” - Bri Williams
“We're endeavoring any way to try and get people to do things. Unfortunately, people's lack of understanding of behavioral science or behavioral economics means that they're doing it based on this assumption that people do make decisions rationally when in fact we don't.” - Bri Williams
“Always think of price in context. So oftentimes we think of price as a number when in actual fact the person receiving that price, it's going to be receiving it in a whole range of contexts. And so it's your opportunity and in fact, your responsibility as a business to set that context.” - Bri Williams
- People / Resources Mentioned:
- Daniel Kahneman
- Thinking, Fast and Slow by Daniel Kahneman
- Behavioral Economics for Business by Bri Williams
- The Little Book of Pricing and Payment by Bri Williams
Connect With Bri Williams:
- BriWilliams.com.au
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn about product management’s role in pricing strategy
- Learn the importance of having a strategic customer and market-driven business case that will define the direction of your product and what you want to achieve
- Understand Customer Perceived Value, what appeals to the consumer and why you need to put a dollar value to your product feature/solution
Steve Johnson is the CEO and founder of Under10 Consulting. His focus is on implementing 'just enough' process using proven methods.
Since 1979 he has worked in computer hardware, software, and services. Over the years he has moved up from product manager to CMO and has worked with tens of thousands of product managers and product leaders at thousands of companies.
In this episode, Steve Johnson shares how to implement world-class product management.
“Look at the cost savings or the impact on customers and take 10% or more. You know, if you've got a good brand name, you can charge 15 if you don't, you can charge 10 but you certainly need to be at the end of the day. If you're solving a problem that people don't have 10% enough and is still nothing.” - Steve Johnson
Increase Your Pricing Knowledge: Become a Champions of Value INSIDER!
To sign up go to insider.championsofvalue.com.
Use the promo code 'INSIDERNOW' to take advantage of our special $5 offer for the first month.
Topics Covered:
01:42 - What his product management role look like thirty years ago
03:52 - What are the roles of product managers and product marketing managers
08:48 - Why the need for clarity on buyer persona, market size, and positioning
11:58 - Are product managers thinking about the value or are they just thinking about problems
15:59 - Why write a business case and why the need for due diligence on an idea
17:49 - How to value a feature or solution
21:53 - Stressing about the importance of product strategy, product planning, and product growth
25:03 - The best pricing advice he has
Key Takeaways:
Quoting Luke Hohmann: “A product owner, now a product manager owns pricing, a product owner doesn't.” - Steve Johnson
“Right now, I'm kind of enamored with three brand new titles that I made up, product strategy, product planning, product growth because other people have got all this baggage with product manager or product owner and or product marketing manager. But I like those three titles because it aligns directly with what I'm wanting them to do, which is come up with a strategy for future products or come up with a plan for what we're going to do next or look for ways to grow the products we have now.” - Steve Johnson
“All of my work is really around pretty simple metaphors like, all right, now that you have those three roles or one role, let's write down everything you expect those people to do and I'll show you how to decide whether those things are product things, development things or sales things.” - Steve Johnson
People / Resources Mentioned:
- Luke Hohmann
- Natalie Louie
- Innovation Games: Creating Breakthrough Products Through Collaborative Play by Luke Hohmann
- Quora
- Hired
- Zuora
- Oracle
Connect With Steve Johnson:
- sjohnson717.com
- Under10consulting.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
-
Learn how to calculate expected Customer Lifetime Value (CLV) value in order to create profitability quicker in your subscription business
-
Learn how to use customer data to optimize your subscription pricing
-
Rules and regulations that you should understand about subscription deals
Kathy Sexton is a CEO and Publisher at Subscription Insider. She is an executive leader with specialties in market strategy, brand development and digital information products.
In this episode, Kathy talks about how to build, market and sell profitable subscription-based products and services, the different subscription payment operations that drive higher profitability and also shares different customer success solutions that is available in the subscription industry.
"Make your products easy to cancel, make it a great experience and people will come back."
- Kathy Sexton
Get COV’s Pricing Metrics:
The Most Important Pricing Decision in a Subscription Business Course at https://www.championsofvalue.com
Topics Covered:
01:31 - How she got started in subscription and what is her mission in the subscription industry
03:32 - What companies does subscription economy cover
06:22 - The differences and similarities of subscription companies
08:08 - Of take-rate, acquisition rate, and retention rate
14:02 - Are insurance companies under a subscription economy
14:48 - Cohorts versus direct marketing
18:20 - Big Pricing issues in the subscription industry
19:50 - What is a negative option
24:15 - Rules and regulations that you should understand about subscription deals
Key Takeaways:
“Talk to your customers deeply and really understand them. Understand the nuances that don't come through a survey.” - Kathy Sexton
"Honestly with any business, you want to have that direct relationship with your customer. So if they have any issue, they come to you first and not to some third-party provider, the worst thing you want is just to have a cancellation. No reason why you've lost that business and no way to recover it." - Kathy Sexton
"Good business is making it easy, very understandable, and then people are going to want to do business with you." - Kathy Sexton
People / Resources Mentioned:
-
The New York Times
-
The Wall Street Journal
- Washington Post
- Lesley Fair
Connect with Kathy Sexton:
- subscriptioninsider.com
- E: kathykgsexton@subscriptioninsider.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn how to use the data that is funneled into your subscription management
- Find out the leading indicators of customer churn, and what to do about it
- Learn how to package features into bundles that will create good pricing and eventually the most revenue for your company
Mark Thomason is a Research Director - Digital Business Models and Monetization at IDC. He is one curious person that loves the challenge of understanding needs and creating something that’s high quality, simple and easy to use. He understands the thrill of creating and working in a high-performance team. He is known for being focused, easy to get along with, & getting things done quickly.
In this episode, Mark shares technologies and best practices that are used in monetizing digital solutions that result in optimized pricing.
“If you're a company that has a physical product, if you haven't investigated price optimization product, you should because they have a very quick payback.”
- Mark Thomason
Mark Thomason's Upcoming Event: Join IDC's 55th annual industry business briefing
Directions 2020 ~ Changing Customer Requirements: Creating Value in the Digital Economy
March 4 in Santa Clara, CA ~AND~ March 10 in Boston, MA
For more information visit: http://www.idc.com/directions
Get COV’s Pricing Metrics:
The Most Important Pricing Decision in a Subscription Business Course at https://www.championsofvalue.com
Topics Covered:
02:08 - What is IDC and what does it do
03:15 - What service do IDC sell
06:06 - What are digital business models and monetization
10:18 - What is futurescape
16:13 - Taking a closer look at Zuora's subscription business model
24:22 - Mark's best pricing advice
Key Takeaways:
"A lot of the based functionality of managing subscriptions is really just making sure that you do revenue recognition correctly." - Mark Thomason
“You want to know that as a product manager and as from a monetization point of view, you want to understand your value metrics. And if you're a software company, if you can identify and watch, basically your users use, you know, features or capabilities of your product, you can go, okay now I can watch over the shoulders of my potentially thousands of customers and I can know what this cohort value.” - Mark Thomason
People / Resources Mentioned:
- Zuora
- Forrester
- Gartner
- Pros
- Vendavo
Connect With Mark Thomason:
-
LinkedIn
-
IDC.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Understand how personalized customer onboarding converts and retains more customers
- Find out the different pricing metrics Bonjoro used in coming up with good pricing
- Find out how market segmentation helps in coming up with good pricing
Matthew Barnett is the founder of Bonjoro and head honcho at Verbate. At the same time, he is also a contemporary artist.
In this episode, Matt shares how Bonjoro uses different pricing metrics to come up with product pricing, and market segmentation helps them in deciding price.
“I think especially early companies, think about what you want to price and price triple.”
– Matthew Barnett
Get COV’s Pricing Metrics:
The Most Important Pricing Decision in a Subscription Business Course at https://www.championsofvalue.com
Topics Covered:
01:04 – What does his company, Bonjoro do and what unique Pricing strategy does it have
02:06 – One important message Bonjoro is driving at in sending videos rather than emails or text to customers
02:22 – Pricing the Bonjoro way
07:16 – Making decisions on usage data
12:51 – Do pricing metric and value metric mean the same thing
14:21 – How did Bonjoro come up with all the pricing metrics
17:55 – Why Bonjoro don’t do Options for now
22:18 – How to go about Options in Pricing
25:32 – Looking at Slack and Zoom’s Pricing model
32:07 – Why you need to give value at the onboarding of customers stage
33:52 – Thoughts on price endings
37:19 – Grandfathered pricing
40:54 – Matt’s best pricing advice
Key Takeaway:
“At certain points on the customer journey, like this face to face stuff actually stopping for minutes and being like, it’s me, I’m a human. That’s what it’s about.” – Matt Barnett
“Some of the sides of pricing is also packaging.” – Matthew Barnett
“I’m at the point where I’m like, I kind of hate paying them but I keep paying it. So that to me is as a business owner I look at that and go that’s good pricing because I hate it enough to leave, but they extract every single dollar from me that they could possibly get like that.” – Matthew Barnett
“I think given the fact that quite early in the company, I mean three years to me it’s still early, it says of a product. So I think one of the things here is to get to the stage where the three if we end up with the three plans or all of the four plans for the three. Those are the right price to value match as a base and then we start to add things on there that as far as segmentation. I actually do think higher plans honestly need a bit more bolstering in terms of feature sets.” – Matthew Barnett
“It’s much easier to start high and then go, oops, come down than it is to go double your price and the next day. And I was like, hang on a minute.” – Matt Barnett
“ I mean especially early companies always, always price too low. We are one of these. We did it too. I think if people don’t push back and say, ‘Hey, your price is too high.’ If no one ever says that, your pricing is too low.” – Matthew Barnett
People / Resources Mentioned:
- Slack
- Zoom
Connect with Matthew Barnett:
- Bonjoro.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Understand how Data Science helps in pricing * Find out the disconnect between product managers and data scientists in terms of pricing a product * Discover why pricing work better with data analytics allowing you to compare and assess different strategies
Neil Biehn is the Vice President of Business Analytics at Siemens Healthineers. He has over a decade of experience in analytics, segmentation, sales effectiveness, and pricing optimization. Neil’s specialties include Analytics, Segmentation, Revenue Management, Price Optimization, Operations Research, Willingness-to-Pay, and Data Science.
In this episode, Neil shares with us how Data Science helps in pricing. He also deep dives into why pricing works better with data analytics allowing you to compare and assess different pricing strategies.
“Profit as a guide for price is limited and should be used only if it is in line with the strategy of a company. You are willing to lose customers to maintain a profit margin, ultimately, your customers don’t care about your profits, they care about the price of your services or materials or any products. Let Finance worry about running your profits.”
– Neil Biehn
Get COV’s Pricing Metrics:
The Most Important Pricing Decision in a Subscription Business Course at https://www.championsofvalue.com
Topics Covered:
01:22 – How his path in Pricing started
04:38 – A description of his current job
05:45 – How does he describe the relationship of “business people’ in an organization with ‘data science people’
10:17 – Logical comparison of the engineering team with the data science team
13:40 – A look at one case study of coming up with good pricing at Siemens
19:25 – How does he help solve a company’s price erosion problem
20:24 – His one valuable pricing advice
22:10 – How it looks like finding a solution to problems the data science way
Key Takeaway:
“If you have data and have the facts, why wouldn’t you use it? Every single data point you have about price, every purchase someone makes at a price point will give you an unbelievable wealth of information and you should use it.” — Neil Biehn
People / Resources Mentioned:
- The Price Advantage by Walter Baker and Craig C. Zawada
- PROS
Connect with Neil Biehn:
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Why it is not a good idea to use Cost-Plus pricing in the manufacturing and distribution channels
- Which tool to use to provide data for a favorable Pricing when you can’t obtain data from distribution channels
- Find out favorable arguments, from a pricing standpoint, to go direct selling rather than by way of distribution channels
Ralph Zuponcic is the president and co-founder of PricePoint Partners, LLC., a company that enables wholesale distributors and manufacturing companies to improve margin performance through price optimization initiatives, margin management tools, and highly effective pricing training programs. He is now a national authority on strategic pricing and margin management. Ralph has lectured at The Ohio State University Fisher College of Business and at associations and companies across the country. He has also been featured in publications including The Wall Street Journal, Fortune Small Business, CFO Magazine, and Marketing News.
In this episode, Ralph shares about pricing in the manufacturing and distribution channels industry.
“Focus on smaller accounts to start with. And see what kind of improvement you can get there. And look for that price variation. And you don’t need to boil the ocean just start getting some improvement. Start small with pricing. Get some early wins. And move on from there.”
– Ralph Zuponcic
Get COV’s Pricing Metrics:
The Most Important Pricing Decision in a Subscription Business Course at https://www.championsofvalue.com
Topics Covered:
01:26 – Ralph’s path to Pricing
04:07 – Reasons why he is not for Cost-Plus Pricing
07:08 – Why is there a lot of focus on cost in manufacturing companies
08:33 – What happens when you use Cost-Plus Pricing and you lower your cost by a certain percentage
09:03 – What do most distributors use other than Cost-Plus to address competitive pressures
11:32 – What benefit can you get from Price-Variance Analysis
12:59 – How to deal with Pricing with distribution channels who don’t have direct sales forces in the marketplace
16:06 – How to do Pricing for distributors that is advantageous to both manufacturers and distributors
18:18 – Ralph’s thoughts on distributors getting to choose their own prices
21:31 – The difficulty with the manufacturer not having direct access to a distribution channel’s Pricing
24:10 – From a pricing standpoint why is selling directly a better choice than through distribution channels
25:26 – On the idea of manufacturers trading lower price to distributors for their data
26:55 – Valuable pricing advice that can impact one’s business
Key Takeaways:
"If you are obviously pricing too high for the distributor and doesn't leave him enough margin, it disrupts what's going on in their marketplace with the final user or the final buyer. Achieving that balance is difficult. If you can have a relationship, maybe not with all the distributors, but some key distributors that are tight enough that you can have those discussions openly and honestly, it starts to give you some better insight and then you can cooperate right with each other to arrive at a pricing that's going to be meaningful both coming from the manufacturer and coming from the distributor." — Ralph Zuponcic
"If I'm a manufacturer and I have the choice between direct and distribution, I know what I would prefer from a pricing standpoint. I'm ready to go direct. I have more control."— Ralph Zuponcic
"What we do is we take all the data, all the price points that have been charged for a given item. We put them on a scatterplot, and we see how much variance there is. When you look at that scatter plot, we tend to think of it as market research data because it's telling us what customers are willing to pay." — Ralph Zuponcic
“Start small with pricing, get some early wins and move on from there.” — Ralph Zuponcic
Connect with Ralph Zuponcic:
- Pricepointpartners.com
- Phone number: (330) 342-0923
Connect with Mark Stiving:
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Discover about marketing strategies that drive pricing for optimized revenue * Learn about strategies and techniques to pull in data as the basis to optimize pricing for your vacation rentals * Learn how Beyond Pricing software product gather in data to come up with favorable pricing
Ian McHenry is co-founder and board member for Beyond Pricing. He is a former investment banker and a management consultant in the airline and hotel industry. He founded Beyond Pricing, which helps vacation rentals and Airbnbs maximize their revenue through innovative software products and which has raised over $45m in venture capital from top-tier investors including Bessemer.
In this episode, Ian shares his expertise on pricing vacation rentals and how to optimize revenue earned from them.
“Expose a bit of that black box. As you said, there might be just a couple of factors. There’s a lot of things that go into the factors, but if you can show like the prices up because of the seasonality versus an event, that creates a lot of trust and if you can show some of the underlying data trends that support that kind of recommendation and decision, it helps out a lot.”
– Ian Mc Henry
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
01:13 – What is Beyond Pricing Company
02:27 – What paved the way for him to Pricing
03:55 – How to optimize pricing for only a single unit in Airbnb
05:00 – How to look at external demand data to come up with vacation rental pricing
06:57 – What other information do they have to pull, especially if there’s a one-time event coming up
11:44 – How not to underprice or overprice your vacation rentals
16:05 – How does Ian price their own product
21:53 – On trusting the data versus using the data in a black box
20:23 – His pricing advice that impacts one’s business: “Play with data and segment a lot.”
Key Takeaways:
“I knew it wasn’t true when property managers told us we can’t make income from vacation rentals. I had all the data that tell otherwise. At any rate, we ended up making a lot of money off of it because it was really easy to capture that demand by just dynamically pricing it properly.” – Ian McHenry
“If you’re really trying to figure out to do, play with data and segment a lot like trying to understand demand and willingness to pay across all different kinds of segments you find interesting. I’ve found that you find interesting stuff just playing with the data.” – Ian McHenry
“If you’re building a product like ours where you do have buyers of that data that they need to trust the algorithm and not have it be a black box, one last thing is like expose as much as you can without necessarily giving away the secret sauce because a lot of the problem is getting buy-in for these predictions that you’ve made. – Ian McHenry
“Expose a bit of that black box. Like you said, there might be just a couple of factors. There’s a lot of things that go into the factors, but if you can show like the prices up because of the seasonality versus an event, that creates a lot of trusts and if you can show some of the underlying data trends that support that kind of recommendation and decision, it helps out a lot.” – Ian McHenry
People / Resources Mentioned:
- JetBlue
- Allegiant Air
- Oliver Wyman
- Southwest Airlines
- Smith Travel Research
- Hertz
- Andrew Watterson
- Scot Hornick
Connect with Ian McHenry:
- E: ian.mchenry@gmail.com
- https://beyondpricing.com/
Connect with Mark Stiving
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * What does factors like leadership and influence have to do in pricing your product and service * Pricing lessons you need to know to understand your business better * Discover how to organize your pricing leadership function for your business success
Kevin Lemke is a commercial executive with a passion for fixing and creating businesses. Strong record of delivering revenue and margin upside. Career-to-date benefits generated are greater than $500M of additional margin – an average of .5% return on sales. His specialties include organizational Leadership, Innovation Strategy, Turnarounds & Business Transformation, Digital Marketing, B2B Sales, Pricing Strategy, Go-to-market Model Development, Value Proposition Development, Whitespace Identification, Organization structure development, and alignment.
In this episode, Kevin shares with us his expertise in setting up pricing in B2B and B2C businesses.
Bring your sales guys into the conversation and have them be part of making sure that we’ve got the price, the right pricing programs, and discipline. I think they need to be part of this. They benefit. We all benefit.”
– Kevin Lemke
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
01:08 – What does he do as VP of innovation
01:54 – How did his career in Pricing start
03:05 – How was it like learning the systems and processes already in place at the time he entered the aviation industry
05:20 – Thoughts about “pricing is the sales prevention team”
06:29 – Talking about Leadership in Pricing
07:16 – Describing his stint at Zilliant and where this company is focused at
08:53 – Leading a pricing initiative when he got back to Dell
10:15 – What does internal product management entail
11:01 – Lessons he learned in pricing that helps in understanding business
11:49 – The hard part of doing internal sales
13:27 – Hints on how to be doing internal sales
14:57 – What has contributed to his vast knowledge about pricing
17:37 – What happens when we focus on value
18:24 – What differentiates B2B pricing from B2C pricing
19:47 – One valuable pricing advice he has
Key Takeaways:
“To be successful, to do things right, it’s very much a team effort, you know, and you can imagine, especially in these large fields you’re at in the center of things. So, it’s bringing a team of sales, finance, marketing, operations folks together.” – Kevin Lemke
“To be successful, to do things right, it’s very much a team effort, and you can imagine, especially in these large fields, you’re at in the center of things. So, it’s bringing a team of sales, finance, marketing, operations folks together.” – Kevin Lemke
People/ Resources Mentioned
- Stanley Black & Decker
- Continental Airlines
- American Airlines
- Dell Computer
- Zilliant
- Chris Mitchell
Connect with Kevin Lemke:
- E:kevin.lemke@sbdinc.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast:
- Find out about Model N’s pricing software, how it works and how it differs from other pricing vendors
- Understanding the different channels High Tech industries go through and how this affects pricing and value setting
- How does price execution play a big part in the price optimization
Chanan Greenberg is a seasoned executive with 25 years of experience in front line leadership roles. He helped build companies from pre-revenue to successful IPO, lead acquisitions, held 2 CEO entrepreneur positions in companies selling to Government IT-Outsourcing Contractors, Service Providers, Aerospace & Defense, Telecommunication, High-Tech, and Multimedia Distributors. He led the first evangelical sales into Fortune 500 companies overcoming resistance to change and fear of working with early-stage companies. Nurtured C-level personal relationships with customers, partners, and investors.
In this episode, Chanan discusses revenue management and what Model N does that differentiates it from other pricing companies.
“If you believe in the value of your product and your differentiation and the reason that you exist, don’t be subservient to the rest of the value chain.”
– Chanan Greenberg
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
03:07 – How did he end up in Pricing
04:27 – What industries does High Tech cover
05:37 – The many problem scenarios High Tech help solve
11:49 – How big are the companies that Model N serves
14:51 – Understanding your end customer and why you need to legitimately ask to determine your pricing
17:34 – Difference between Model N’s pricing software and other Pricing companies
23:18 – The importance of having clean data
24:38 – One important pricing advice he has
Key Takeaways:
“Stop thinking about pricing in silos. Pricing has a waterfall that continues well beyond that. It continues into how are you going to do discounting into the channel, whether it’s the ship and debit process or whether you’re paying out a rebate, whether you’re paying out price protection on the inventory that is out there. All these things at the end of the day, bring down that waterfall to its final net results and pricing doesn’t end with optimization. It doesn’t end with analytics and it doesn’t end with the based on the execution of a price and the close of a contract. It continues operating, and unless you can really bring these things into a single continuum, you are invariably going to leave money on the table without any doubt.” – Chanan Greenberg
“If you’re working through channels and you want to understand who is the end customer, what are they willing to pay to determine how much you’re willing to discount, that’s a legitimate ask.” – Chanan Greenberg
“Never assume that you can make up on bad business by scaling the volume. Because bad business is bad business, whether it’s big work or small.” – Chanan Greenberg
“If you have good price execution in place, whether it’s a Model N or a different solution, then bringing in a solution that can help you do the micro-segmentation, try and change the curves of your product lines to adapt to specific market dynamics that you may have in different end markets or different territories, I think definitely has a creative value.” – Chanan Greenberg
“You really need to stick to good price execution because what I’ve found in many companies is they think it’s like a magic formula. You implement it, you did it, and now it just supposed to continue spewing out great pricing for you when in fact you have to keep on feeding that beast every quarter.” – Chanan Greenberg
Connect with Chanan Greenberg:
- https://www.modeln.com/
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Learn about Paul’s ‘3 Pillars Of Revenue Generation’ to help you avoid underpricing your service * Discover why you should charge clients more than you think you’re worth * Learn how to price your service premium without getting objections
Paul Klein is a Business Scaling + Pricing Strategy Consultant for Existing (and Aspiring!) Business Coaches & Consultants.
In this episode, Paul shares how he helps clients charge what they truly worth, diving into an in-depth discussion on pricing strategies, how to set up long term pricing and positioning and a discussion on why your willingness to lose a deal is key to get your price.
“Your client is saying to you that you ‘never’ negotiate. That means two things to me – you positioned yourself to command that greater value, and you’re not wavering on your value.”
– Paul Klein
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
01:15 – The government job he had and what it was like
03:14 – How he got started in Pricing
04:47 – An analogy of Pricing through Sports
06:04 – Why he named his podcast as Pricing Is Positioning
08:16 – Why solopreneurs tend to underprice themselves
11:48 – What does it mean when your client tells you you never negotiate
13:26 – Why it is hard to do value-based pricing
16:39 – Why is the willingness to losing a deal a key for a solopreneur to get his price
20:07 – How not to look desperate to close a deal
22:01 – How he got his Fortune 500 client
Key Takeaways:
“You have to provide the value and there are three parts to every brand, a visual identity, verbal identity, and valued identity. And if all three of those things aren’t in direct correlation with each other, it’s not gonna work.” – Paul Klein
“Be all in. If you don’t value your services and your products, neither will the market and you’ve got to believe in it first before anybody else will ever pay you for.” – Paul Klein
“Would you rather have four quarters or a hundred pennies so you could serve a hundred people or you could have four big fish? I’d rather have the four big fish.” – Paul Klein
“I think you have to be, whenever you make a pivot or whether you’ve already made a pivot, you to have three pillars of revenue for every successful solopreneur consulting business.”- Paul Klein
People / Resources Mentioned:
- Ron Baker
- Blair Enns
- Alan Weiss
- Neiman Marcus
- Walmart
- Yum! Brands
- Target
- KFC
- Cracker Barrel
- J.C. Penney
- Pricing Creativity: A Guide to Profit Beyond the Billable Hour by Blair Enns
Connect with Paul Klein:
- Pricing Is Positioning Podcast
- PaulKlein.net
- YouTube
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Discover how they do market research in Conjointly * How product and market research affect pricing decisions? * How is Conjoint also used for claim selection of consumer goods?
Nik Samoylov is a Russian who moved to Australia and is the founder of Conjoint.ly, an online service for product and pricing research. He is a former consultant of Bain & Company. Nik was an outstanding student when he received First Class Honours with University Medal in Marketing from the Australian National University.
Catch Nik and find out more about his love for market research, that paved the way to put up his online service company called Conjoint.ly. Learn from him as he details how the process of product and pricing research using conjoint analysis. Also, Nik reveals how conjoint can be useful for all kinds of mass-produced goods and the compelling reason why you need to price up.
“Sometimes, people are really afraid of pricing up, and a lot of the time, pricing up is a very good idea. People question the results of market research when the recommendation is to price up more than when it’s the price down. I think sometimes it’s useful to follow what the numbers say and price up if that’s what the numbers say.”
– Nik Samoylov
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
00:47 – Three things to know about Nik
01:47 – How he got the idea of building his company called Conjoint
02:30 – Narrating how they do market research at Conjoint
03:51 – Asking 12 questions to several people to identify segments within the market
04:57 – Number of attributes they recommend in a product
06:08 – How the market studies made affect pricing decisions in Conjoint
10:21 – Nik details how Conjoint is also used for claim selection of consumer goods
11:26 – Using Conjoint in building customized products
13:42 – Conjoint is valid for B2B products
15:50 – Automated projects as their primary offering and no consulting work
15:59 – Price range of Conjoint
17:45 – Training program to teach people how to do Conjoint
19:02 – A piece of pricing advice to listeners
19:46 – Where and how to connect with Nik
Key Takeaways:
“Individual-level predictions are not as robust as maybe potentially they used to be, but it’s still pretty good at predicting what the market overall once. And it’s good at identifying segments within the markets by looking at clusters of people who have similar preferences. – Nik Samoylov
“When you want to make a decision for a price, you typically put in your product, competitive products, and then, you want to understand the elasticity of the month and use that information to make your pricing decision.” – Nik Samoylov
“Selecting what to say on the product is quite important, especially because it’s not just for marketing, it’s also for building that product, setting up the factory. Big decisions can be made on the facts about whether people are tuned to one statement or another statement.” – Nik Samoylov
“Conjoint is not only used for consumer goods, but it’s also used for all sorts of goods basically. As long as you have something mass-produced, something where you need to make an investment before you decide what kind of things you’re putting together, that’s when the Conjoint can be quite useful.” – Nik Samoylov
Connect with Nik Samoylov:
- conjoint.online
- YouTube
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Know what is the critical role of pricing people to your company’s bottom line * Learn why there is a need to have pricing people in an organization * Discover the importance of really knowing your target audiences in relation to price and value setting
David Mok is a global marketing executive, a pricing champion & thought leader, a change agent, and he helps companies improve bottom-line profit.
In this episode, David deep dives into the importance of pricing to the company’s bottom line, and why as a product manager you must have a price strategy that gets everybody in the organization aligned to it.
“Once we ascertain what a product is worth and to whom, which in theory defines the customer's willingness to pay, the next question we ask ourselves is, ‘What do we want to do that is from a strategy perspective.”
- David Mok
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
01:18 - What led him to pricing and his thoughts about it
03:15 - Talking about pricing people and the need to have it in the organization
06:11 - Skillsets required of a great pricing person
10:52 - Do pricing people not have this leadership influence capability
13:39 - What makes pricing an interesting field
16:52 - Why companies need to be value-based businesses
18:46 - What is a "Pricing Canvass Framework"
20:48 - Why it's hard to value a product and determine it's worth to someone
23:44 - What could be the likely reason for people not to know their target customer so well
24:58 - His Pricing piece of advice: "A piece of advice is don't boil the ocean, know what you can influence, start small. get some success, and continue to build on success. If you are the product manager, my advice is to have a price strategy and get everybody aligned to it."
Key Takeaways:
"I would say people generally have an idea who their customers are, but they don't understand what is it that they value ." - David Mok
"Think about your role and what you can control. There are a number of things we could do in pricing, don't try to boil the ocean." - David Mok
"If you are a product manager, my advice is to have a price strategy and get everybody aligned to it." - David Mok
Connect With David Mok:
- E: davidt.mok@gmail.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Difference between talking to customers about the value of the solution versus the price of the solution * How do people make purchase decisions * How to use choice-based conjoint analysis to determine consumers' perception of value and willingness to pay
Kevin Christian is a highly accomplished pricing leader with 20+ years of track record overseeing pricing strategy, pricing operations, licensing, and packaging for various technology-focused organizations. Leverages expertise in pricing strategy to maximize profits, as well as pricing operations, quoting, and capturing pricing of products inside third party systems.
He has experience at technology companies in Silicon Valley and beyond, with strong knowledge of portfolio packaging strategies for hardware, software, cloud, Web 2.0, professional services, SaaS, and IT products and services.
In this episode, Kevin deep dives into the topic of conjoint analysis, how to use it to help in pricing decisions. Though it has its own limitations, he will also discuss how it can be improved upon.
“ If you’re only talking about the price of the item without talking about the value, then you’re really in the buyer’s territory.”
– Kevin Christian
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
04:04 – How do people make purchase decisions
05:56 – How do businesses decide to raise the prices without affecting demand
07:41 – Kevin’s career background and making a headstart at the conjoint model of pricing
08:27 – Mark’s discussion on the difference of conjoint model between B2B versus B2C
09:47 – Kevin’s thoughts on where the conjoint model works best or less
10:51 – The interesting thing as well as the problem with B2B in using conjoint analysis
11:52 – Behavioral factors and negotiation skills involved in conjoint analysis
12:50 – Limitations of conjoint model and how it can be improved
15:28 – How conjoint analysis is done according to Kevin
19:17 – Difference between talking to customers about the value of the solution versus the price of the solution
Key Takeaways:
“Seeing what that means to me in the real world is that a lot of businesses probably have an opportunity to raise prices by a little bit, which could make a huge difference to them at the end of the year in terms of their profitability and probably wouldn’t make much of a difference to their customers if it’s small-dollar item.” – Kevin Christian
“I guess what I’ve seen a lot in the B2B space is you’re typically dealing with situations where it’s a direct sales force. The deals are highly negotiated and the deal sizes are typically six figures or more and so in the B2B space, in my experience, just conjoint isn’t as obviously the right way to get your optimal price as it is in the B2C space where you’ve got lower selling prices, higher volume of items.” – Kevin Christian
“One thing that I’ve seen with conjoint is that sometimes there’s a difference between what happens in the study, which is a lab situation or an experiment when you’re doing your market research study. And then what happens in the real world, and sometimes the purchase behavior in the real world is not exactly the same as the purchase behavior inside the conjoint study itself.” – Kevin Christian
“If the bear gets in a fight with an alligator who wins. think it depends on where they’re fighting and if they’re fighting on land, the bear is more likely to win. And if they’re fighting in water, the alligator is more likely to win. And what I like about this for pricing is when you talk about the difference between talking to your customers about the value of the solution and talking to your customers about the price of the solution.” – Kevin Christian
“I think when you’re talking about the value of the solution, you’re in the seller’s territory and you’re talking about something where you know the seller is going to benefit from that conversation. If you’re only talking about the price of the item without talking about the value, then you’re really in the buyer’s territory.” – Kevin Christian
Connect With Kevin Christian:
- Email:kevinckevinc@yahoo.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * What is Value Research Discovery * Identifying what specific values the customers have and letting go over assumptions around that * Why is it not necessary to follow your competitors’ pricing model
Alan Albert is the President of MarketFit, providing strategic services that drive measurable growth.
He is a co-founder of three software companies, selling one to Apple Computer. He conceived and led the design and development of multiple top-selling and award-winning products, generating over US$1 billion in cumulative revenue.
In this episode, Alan leads us to a discussion about market segment, pricing metrics, and value, how they all relate to value creation and pricing. His vast knowledge about capturing value will give you a clear understanding of what value-based pricing is all about and debunks whys much of what you know now about your customer is wrong.
“Whether your company's biggest challenge is in the area of innovation or in marketing or in product or in pricing, they all tie into customer perception of value. Start by letting go of your own assumptions about what our customers should care about and take the time to truly discover and understand and gain insight into your customer's perception of value.”
– Alan Albert
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com
Topics Covered:
01:24 - What is Value Discovery Research?
02:30 - What is Value?
05:58 - Customer Value: What it means and how to create it
07:02 - Walking through the process of Value Discovery Research
11:35 - Why value-based pricing is a misunderstood model
13:56 - Values: Why most companies get it wrong
14:52 - What is Market Segment and how does this relate to Value
16:46 - How does Value Discovery Research drive Pricing Model
17:53 - What is a Pricing Metric
21:05 - Why it is not effective to follow your competitor's pricing model
Key Takeaways:
“The first step in value discovery research is to acknowledge that we do not know our customer's perception of value. My definite definition of value is what something is worth in exchange as perceived by the recipient.” – Alan Albert
“There is a difference though than having the same problem and having the same values about how to go about solving it. Some might want to solve it with a do it yourself approach. Some might want to buy the most expensive product on the market. Some may want to just dip their toes in and try something without being too committal. They all still have the same problem, but the values of the people may be different and that will lead them to different solutions.” – Alan Albert
“Often people think of pricing initially as picking a number, what price should we charge? And by focusing on customer perception of value, I've learned that pricing is actually an area for innovation that by changing the pricing model, companies can do a far better job of generating revenue and distinguishing themselves in the market than just picking a number.” – Alan Albert
“Following your competitor’s pricing is rarely the most effective strategy. Companies like Netflix with their all-you-can-eat subscription pricing or Amazon with Amazon Prime have seen just enormous gains just by coming up with innovative pricing models, by changing what people are paying for.” - Alan Albert
“If we know what our customers value and we can measure the delivery of that value, we can increase the price of our product so that those who are getting and receiving the most value and perceiving the most value are paying the most for it.” – Alan Albert
“One way of distinguishing your product or service in the marketplace is to use a completely different pricing model. This makes it so that your customers cannot directly compare your product to theirs as a commodity.” – Alan Albert
“Understanding the customer's value is, does not mean you need to have a complicated pricing model. In fact, simplicity as you mentioned, is a virtue and that's the beauty of something like Amazon Prime, like Netflix, all-you-can-eat subscriptions, it's relatively easily understood and the value of it is quite clear.” – Alan Albert
Resources / People Mentioned
-
Infobip
-
Pragmatic Marketing
Connect with Alan Albert:
-
MarketFit.com
-
LinkedIn
-
Twitter
-
Email: alan@marketfit.com
Connect with Mark Stiving:
-
Email: mark@impactpricing.com
-
LinkedIn
-
Twitter
-
https://www.championsofvalue.com
Why you have to check out today’s podcast: * Discover the 3 central C's of Value; creating, communicating and capturing value * Learn what is customer perceived value and how outcome appeals to them rather than benefits only * Learn how to be a customer experience expert and how to get customers talking about your company
Mark Boundy is a sales, value, differentiation, and pricing expert who helps companies sell more profitably.
He's a consultant for Miller Heiman, an advisor and thought council member to The C-Suite Network where he advises corporations on all things value-related, identifying their fundamental differentiators to help them choose where to compete and how that informs boots-on-the-ground selling.
In this episode, Mark shares how W. L. Gore & Associates taught and instilled in him the importance of customers perceived value to a business, why value should be a religion to any business, the 3 central C's in marketing, and the importance of focusing on the outcomes you bring to customers rather than benefit.
"I often see the word benefits use differently. So, I no longer like to use the word benefits with my clients. Because benefits sometimes mean less than what I think of its value. I use the term ‘outcomes.’"
– Mark Boundy
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com Topics Covered:
1:58 - Mark shares lessons he learned from a material science and engineering company called W. L. Gore & Associates
2:39 - How value has become a religion to him and everyone else at W. L. Gore & Associates
7:49 - Creating Value: Why it is important to know what the value of the customer is going to be and the value of the product to that customer
15:59 - Communicating value: why the outcome is better than the benefit
19:17 - Capturing Value. Why front-liners like salesperson has a significant role in understanding customer's outcomes and why should they be trained in communicating understanding the customer's business
21:17 - On being an expert at your customer's business, how Microsoft Enterprise is practicing to help their consumers understand their market
24:33 - Mark shares how Bob Miller trains their consultants at Miller Heiman. Bob to Mark - “Customers don't buy their products. They buy results or outcomes.”
Key Takeaways:
"You need to be able to have a dialogue with a customer to understand their outcomes and to understand their business." –Mark Boundy
"Help the customer understand that a high price is a low price to pay for the kind of outcome [you offer]." – Mark Boundy
"It's the outcomes is the desirability outcomes, and it's built on the differentiation, the outcomes they get from you that they can't get anywhere else." - Mark Boundy
People and Resources Mentioned
- The C-Suite Network
- Miller Heiman
- Bob Miller
- Microsoft Enterprise
- W. L. Gore & Associates
- Listen to Mark’s Impact Pricing Interview: Ep 15: Mark Boundy – Value Selling: How to Sell Value Rather than Price
Connect with Mark Boundy:
- Email: mark@boundyconsulting.com
- Read his blog: boundyconsulting.com/blog
- boundyconsulting.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Learn about why the accounting world, as well as the cars industry, are leaning towards subscription pricing these days * Discover why timesheets focus firm leaders on the wrong things especially in pricing and value setting * No Timesheets? Is it Possible?
Ronald J. Baker is the founder of VeraSage Institute, a reformed CPA and cost accountant who has changed his mind on the value of timesheets and cost accounting. His quest is to bury the billable hour and timesheets.
He is also a radio talk-show Host, The Soul of Enterprise: Business in the Knowledge Economy heard on www.voiceamerica.com.
In this episode, Ron articulated so well his arguments over not using timesheets in setting up pricing. He has refuted all defenses for use of timesheets. At the same time listen to him as he gives profound examples and explanations as to why certain pricing value and cost models are appropriate for particular industries.
“If we took the time that we spend [or waste] doing timesheets and did after-action reviews instead. I think we'd be much further ahead.”
- Ronald J. Baker
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com Topics Covered:
02:18 - Talking about four defenses for timesheets in relation to Pricing
03:34 - Taking into consideration the Cost of Goods Sold in setting the price
06:58 - Difference between a metric and measurement type of cost allocations
09:16 - Of Opportunity Cost and Sunk Cost
10:25 - Is time really considered in setting up pricing
14:23 - Project management as a way of making better decisions in the future
17:25 - The best advantage of niching your expertise on
20:01 - The start of subscription pricing in the accounting world
22:13 - Insurance classified as subscription pricing
25:11 - What's the best thing about hiring an accounting firm rather than accounting staff for your business
28:34 - His thoughts on cars leaning towards a subscription model
Key Takeaways:
“Prices to me are like agents. Why do sports stars and actors and authors have agents not because they like to pay these people 15% of their gross revenue, but because these people can get them higher prices and your prices are your agents. So even if you're a solo entrepreneur, have somebody else help you with pricing because it will put a spine in you and you won't give yourself away because I think all of us are terrible at pricing ourselves.” - Ron Baker
“Keep in mind that I don't need to see timesheets to know your firm's costs. I need to know, I need to see your GL, your income statement and I need to know what your labor and all of that is. I'd much rather track revenue per person or labor cost per person, profit per person in a professional firm because that's a true measurement.” - Ron Baker
“Even if they're just starting out as a sole solo. Don't have any employees. I still think they can put a price on things consistent with their opportunity cost and what they want, willingness to accept and function fine, and this is an integral part of this, as long as they step back after the job is completed and do an after-action review and learn from it.” - Ron Baker
“If you're niched, if you specialize, it's much easier to know what something's going to take once you build up some experience.” - Ron Baker
“A subscription model is a way to lock customers in for life. So in value pricing to Oh you're pricing, not the customer. And this is the subtle difference, but bear with me, you're pricing the relationship and your pricing the portfolio because you're looking at it as a portfolio rather than a project or just a customer. You're actually looking at the entire portfolio.” - Ron Baker
“We're too busy. I think we confuse being busy with being effective and being profitable. And I'll see a correlation there.” - Ron Baker
Links and Resources Mentioned:
- Bain and Company
- Mckinsey and Company
- Porsche
- Canvas + Fair
Connect With Ron Baker:
- Verasage Institute
- Email: ron@verasage.com
Connect with Mark Stiving:
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Discover why value capture is the most important business idea your business should know about * Find-out where should the pricing function reside in your business? * Learn why your pricing strategy should be a team effort
Tim J. Smith is the Founder and CEO of Wiglaf, a dynamic and growing advisory firm, where thought leaders in pricing, marketing, sales, and business strategy help firms achieve improved pricing and help executives manage price better.
Tim is also an adjunct professor at DePaul University where he is an Economics and Marketing Professor specializing in Pricing Strategy. He authors books, Pricing Strategy and Pricing Done Right.
In today’s episode, Tim shares the pervasiveness of pricing in a company. He stressed a point on how each key role in the company should have knowledge about pricing concepts to come up with a team effort on value capture.
“Don't go for the cheapest customer. Go for your best customer and set your price there.”
- Tim J. Smith
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com Topics Covered:
01:28 - What paved the way for him into Pricing
02:36 - Why did he name his company Wiglaf
04:04 - What's the big thing about Pricing today
04:50 - Getting deeper into Pricing being a verb piece
06:32 - Pricing being a team effort
08:59 - Who is a Pricing Person
09:58 - A product manager role in pricing
13:13 - What should really be expected of Pricing people
15:26 - What does it mean when you say "pricing should get involve"
17:20 - Pricing is not a person, it is a verb
18:38 - His company's, Wiglaf, big projects
21:53 - Some more problems and concerns in Pricing and clients today
22:51 - His valuable Pricing advice that would have a big impact in business
Key Takeaways:
“Don't go for the cheapest customer. Go for your best customer and set your price there.” - Tim Smith
“I do want to point out that I did mean HR because I see pricing also having a role in structuring sales incentives and other incentives about value capture and value communication.” - Tim Smith
“ Putting the plan to study, adjusting the Deming constantly, and constant improvement cycle, putting these into your commercial policy and your pricing enables you to make this continual improvement in value capture.” - Tim Smith
“Salespeople need tools to communicate value. If you're going to expect those salespeople to capture any, people also need to know what segments of the market is likely to purchase so that they don't waste the time on customers that are out of the market.” - Tim Smith
Links and Resources Mentioned:
- Symantec
- 3M
- Wiglaf Pricing
Connect with Tim Smith
- Wiglaf Pricing
- https://wiglafpricing.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Learn when to use pricing metrics and pricing models
- Learn how and which pricing model to use to fit your customers’ needs and to align towards their cost and revenue goals
- Learn about how he closed a $200-million dollar deal without having to reduce its price despite the customer’s feedback of such price being triple as the one offered by another vendor
Kota Sarma is a Certified Pricing Professional and passionate Pricing Leader with over 25 years of experience in Pricing of Products, Software and Services, Subscription Pricing, Advanced Pricing Models, Commercial Analysis & Analytics, Business Planning & Modelling in Telecommunications, Polymers, Natural Gas industries.
In today’s episode, Kota shares with us his expertise in pricing especially in terms of using pricing metrics and pricing models which best suit customers’ needs. Also, learn about how not to reduce your pricing by switching pricing models and setting up price structures that meet customers' cost and revenue goals.
“In some situations, I've seen, the business model itself is a totally new model and customer is not sure of the success. What happens? Customers will try to get the best price from you, which means the lowest price from you. Instead of dropping your price, you can change your total price model, a price structure and see that it needs a kind of risk-sharing model. You can propose your risk-sharing model where you grow with the customer.”
- Kota Sarma
Topics Covered:
02:02 - How did he start his career in Pricing
03:34 - How is a gas transportation sector priced as compared to an ordinary commodity
04:09 - Should you be doing a lot of cost-plus pricing in a regulated commodity
05:12 - Who sets the price in a gas transportation sector
05:45 - Is the cost of raw materials included in the pricing for polymers
07:13 - What are the pricing differentiators for polymers
07:44 - Conjoint analysis and customer value index
08:44 - The different pricing models he uses and how it works
14:01 - Of price metrics and price models
15:00 - Structuring your price based on customer need
19:26 - How to manage to offer different customers with different price models
21:02 - The immense value of a salesperson who does value conversation
24:12 - Pricing advice that will give impact to one’s business
Key Takeaways:
“Anything is possible but if you cannot measure it, then there is no use in using that price metric. It has to be measurable, number one and it should align with a customer revenue model. That is important.” - Kota Sarma
“If their revenue model is per user, I cannot have per usage. I cannot charge them per usage it has to be aligned with their revenue model.” - Kota Sarma
“Price levels are obviously different depending on the value, the scope and configuration, the time. There are so many terms and conditions and in a way each transaction is unique.” - Kota Sarma
“Don't let your salespeople approve your pricing. They should be aware of their proposals, they should propose a price and somebody else has to approve.” - Kota Sarma
Links and Resources Mentioned:
- Gallup, Inc
Connect with Kota Sarma
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn about account-based marketing’s role in pricing your service
-
Know how to lead an effective pricing strategy and sales enablement by working closely with stakeholders
-
Discover how to effectively deliver strategic product marketing to your target market that increases your win rates
Natalie Louie is the Director of Product Marketing at Hired where she leads pricing strategy, and sales enablement while working closely with stakeholders to ensure alignment and executional excellence.
With over 20+ years of experience in Silicon Valley and Wall Street, Natalie delivers strategic product marketing and pricing expertise. Prior to Hired, Natalie was in PMM at Responsys and during the Oracle acquisition and was Head of Cloud Pricing Operations at the Oracle Marketing Cloud. She also serves as an advisor for Impact Pricing. Natalie currently loves living in the Bay Area with her husband and 3 children.
In this episode, Natalie shares her pricing expertise, deep knowledge, and specialties on improving operations, revenue, profits, integrations, partnerships, managing, SaaS pricing and packaging, product marketing, planning, and development. She also digs deeper into what account-based marketing is all about, how it is related to pricing and product marketing, also the different cross-functional duties of the organization in order to close deals and increase win rates.
“The trend is that marketing actually has a seat at the revenue table. Because with things like marketing automation, where we can impact top of the funnel leads coming in, we now have a direct lever that impacts revenue.”
– Natalie Louie
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com, Use the DISCOUNT CODE: ‘EARLYBIRD’, valid until October 31st, 2019. Topics Covered:
00:46 – Natalie’s path into pricing
01:52 – Her big AHA moment at the PMM Summit, pricing’s trend in relation to product marketing
03:46 – Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course’s impact, the outcome on the actual on the pricing session that she did at the PMM Summit event
05:04 – Account-based marketing, what is this all about in relation to product management
08:37 – Looking at all the different personas inside an account, why you should dig deeper into it
09:54 – Creating conversations whose role is it, sales or marketing, or both?
10:16 – Keeping an eye on what’s happening on accounts and how people are interacting with the different digital and in-person touchpoints
11:31 – Personalizing content for your target market as a sample of account-based marketing making sure that the content you create is based on the company that you’re going after, and the actual people that are in the market
16:12 – Account-based marketing going hand in hand with pricing strategy
16:44 – What Portfolio Marketing is all about, tracking buyer personas to make sure that you know, there are results that have a good impact on the business
18:51 – Watching potential customers or buyers touchpoints – what do they care about, what kind of solutions should you be presenting to them or what should you be talking to them about
19:53 – Cross-functional coordination, why is this important, how daily stand-ups help your team strategize to win deals
22:00 – Product Marketing and sales enablement
22:31 – Natalie’s one piece of pricing advice that she thought could have a big impact on people’s business?
Key Takeaways:
“I see a lot of product marketers now focusing on pricing, on the packaging, on revenue much more, because now marketing can influence every revenue bucket.” – Natalie Louie
“Ideal portfolio marketing is not just one group or one team it’s everybody working together, being on the same page to make sure that we’re giving the customer what they want.” – Natalie Louie
“What we do is we bring in people from different cross-functional groups to come into our meetings and tell us what’s happening. And so the more alignment there is, we find that the better we are able to react and deliver what our customers want.” – Natalie Louie
Links and Resources Mentioned: * PMM Summit San Francisco * Ep9: Natalie Louie – Product Marketing and Pricing Expert * Product Marketing Alliance * Pragmatic Marketing * Salesforce * Oracle * IBM * https://www.championsofvalue.com
Connect with Natalie Louie
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn about the five interrelated elements of value creation * Know how to build your communications strategy and messaging so your prospects and customers can see you, like you and buy more from you * Understand why you need to work with your customers to understand what they value so you can match what you’re selling… to what they want to buy.
David Richards is the managing director at Talk about Value , a company that helps entrepreneurial businesses to accelerate their growth by designing, validating and communicating their customer-focused value propositions so they shine in a competitive marketplace.
Listen in to this episode, as he shares about the different elements of values that help in optimizing the price. With his relevant experience in the world of pricing and value, David surely articulated so well the important points we have to know about pricing and value.
“Find out what [customers] they’re willing to pay. Do as much as you can to understand your customers at a really deep level so that you can understand the value that you’re offering to them and then charge what you’re worth and value rather than necessary your time or your product.”
– David Richards
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com, Use the DISCOUNT CODE: ‘EARLYBIRD’, valid until October 31st, 2019. Topics Covered:
01:11 - David Richards’ ambition: "My ambition is to put value at the top of the agenda in businesses. "
02:33 - What is Value all about according to David
04:45 - What are the ways you can create value
08:19 - What is in a Relationship Value
09:13 - Understanding Perceived Value
09:41 - Getting deeper with Experiential Value
11:04 - What help does his company Talk About Value provide
12:49 - Discussion around what segmentation is all about
14:14 - This thing called Value Conversation
15:49 - How to add value to the relationship
17::10 - All about Van Westendorp’s Price Sensitivity Meter, a market technique for determining consumer price preferences.
21:16 - Best pricing advice from David Richards
Key Takeaways:
“Value is in the eye of the customer, not in yours. They define what value is, not you. And I think it's really important that people understand that because too many times, particularly, my fellow marketeers believe that just saying what you sell is enough, what you need to do is to link that with what people want to buy.” - David Richards
“What is a good value for money? It's quite an interesting word. So, the way I like to describe it, mainly, is the activities you undertake that can add a benefit to the success of the customer that you're working with.” - David Richards
“If you want to be really successful, you need to be the best you can in each of the segments you're playing in and just trying to cover everything and never saying no is, is not a sustainable competitive advantage in my opinion.” - David Richards
Connect With David Richards:
- talkaboutvalue.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Get into grips with the latest thinking on assessing and formulating subscription pricing strategies * Challenges of people and companies in understanding, creating and talking about pricing and value to the customers * Learn how the Accelerate Your Subscription Business course can help your business create and capture more value in your business
Why don't you win deals at higher prices? You don't get paid enough for the value you create. Or do you build products that your customers don’t value (and don’t buy)?
Today, we have no guests. It’s just going to be Mark talking about Impact Pricing’s latest course Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth. A course will help YOU drive growth in your subscription business by giving you clarity and certainty around which tasks drive growth at your current stage.
Listen in to hear the exciting things that Mark has in store for companies, entrepreneurs, and experts that will help them price offerings to capture more of the value they create. Please afford a few minutes to tell you about the course, share a couple of nuggets from the course, and stories behind the journey of creating the course.
“There's so much to learn. Many people and companies don't understand about value, how to sell it, how to create it, how to talk about it, how to figure out what it is to the customer. These are fascinating topics for me.”
- Mark Stiving
Get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth Course at https://www.championsofvalue.com, Use the DISCOUNT CODE: ‘EARLYBIRD’, valid until October 31st, 2019.
Topics Covered:
00:39 – Mark’s passion for creating courses to help people and experts about pricing and value, why he left Pragmatic Marketing despite loving creating and teaching about pricing
01:51 – All about Subscription Businesses, Mark’s AHA after AHA moment that made him decide to create a course around this industry
04:03 – 'Love Win. Keep Grow. Makes it simple.' and more...what people say about the course
06:35 – Where to get Accelerate Your Subscription Business: Your Blueprint to Packaging & Pricing for Growth: Checkout: https://www.championsofvalue.com
People and Resources Mentioned
- Zoom
- Pragmatic Marketing
- Tomasz Tunguz' Red Point Ventures
- Bessemer Ventures
- www.zuora.com
- Patrick Campbell of ProfitWell
- Natalie Louie-Kao
Connect with Mark Stiving
- Email: mark@impactpricing.com
- https://www.championsofvalue.com
Why you have to check out today’s podcast: * Learn an insight on what goes into an SEO service that SEO National offers * Important considerations to take into account for SEO building and his unique pricing strategy that truly adds value * How SEO creates more organic sales than paid ads
Damon Burton helps companies show up higher on Google for words that they can monetize. Damon’s clients include the Utah Jazz and businesses that have been featured on Shark Tank and recognized by Inc.
In this episode, Damon talks about what goes into the SEO service that his company offers and how it works in adding value to the customers, the market segments with which it works best and the pricing strategy he uses to truly add value to customers.
“I think the importance in pricing based on value and being transparent is it builds a reputation.”
– Damon Burton
Topics Covered:
04:35 – His career background and how he got started into his SEO business at the moment
05:54 – His unique pricing strategy
07:06 – How are milestones and deliverables set in an SEO business where traffic to a website is concerned
08:56 – The primary considerations to look into how to go about pricing in his niche
11:09 – Setting prices with customer’s value in mind
13:07 – Getting into the perspective of the service his company offers
16:09 – In what market segment does SEO product work best
17:20 – Why is SEO better than pay-per-click, generally speaking
19:53 – Consequences of building SEO on a generic term
21:24 – His valuable piece of pricing advice
Key Takeaways:
“I mean, pay-per-click has its purpose. It’s not that pay-per-click is bad and you can also run them parallel sometimes, like, if SEO is profitable and pay-per-click is profitable, then run above that. But the advantages and disadvantages are, as we said earlier, is that one, if you want to scale paid ads, you have to pay more. Or if you run into a tight quarter and you need to tighten your budget, you’re going to decrease your leads. So, the appeal, the sexiness of SEO is a little bit of that wild card.”– Damon Burton
“My business has grown almost entirely, we haven’t spent any money on advertising, almost entirely on our reputation because once you get in with a certain level of clients and provide value, they’re going to bring you into their inner circle of other clients that you can bring value to. So it might be a slower play, but it’s going to pay off in the end.” – Damon Burton
Connect with Damon Burton:
- seonational.com
- damonburton.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn what are the key things you have to learn to become a pricing champion * Know why listening to your market is a key thing to deliver value * Discover the critical role of a pricing manager
Vignesh Thiyagarajan has been a strategy and pricing manager at Sears Holding Corporation. And is now doing the same for a large German company named Trelleborg Sealing Solutions. He got his MBA from the Fisher College of Business at Ohio State University.
In this episode, Vignesh talks about how to become a pricing champion and the skills you need to employ to be able to help businesses determine and set competitive value-based prices to gain market share and achieve revenue goals.
“You need to truly understand the customers problems by just asking one question and let the customer talk and reinforce the pain point to the customer if you use that approach across every interaction that’d be phenomenal.”
– Vignesh Thiyagarajan
Topics Covered:
03:01– How Vignesh got into a pricing career, being in the retail industry then joining Sears
05:00 – Hi thoughts about people’s understanding and perception about pricing, is it still ‘the blind leading the blind’ scenario?
05:15 – Importance of influence in the pricing industry, being in the tipping point of pricing adoption
14:00 – How value-based pricing is transforming the B2B and B2C industry
16:20 – How data help you determine and calculate customer’s willingness to pay
20:23 – His strategy as a pricing manager, how he leads and influence his team?
25:03 – Vignesh’s pricing advice: “Always experiment and always learn. Never set and forget about it.”
Key Takeaways:
“Upstream possibilities of product development, and trying to increase the perceived value, and the different tactics or the marketing tactics to capture that will be dramatic. All the industry excites me.” – Vignesh Thiyagarajan
“What is value-based pricing. It is about truly bringing an optimization to deliver value, which means the customer should feel that.” – Vignesh Thiyagarajan
Connect with Vignesh Thiyagarajan:
-
mailto:vigneshahob@gmail.com
-
LinkedIn
Connect with Mark Stiving
- Email: mark@impactpricing.com
-
LinkedIn
-
Twitter
Why you have to check out Today’s podcast:
- Check out what market segmentation is
-
Know the strategies used to get information from customers without the survey questions feel
-
Learn why it is essential to communicate and know the problems of persons inside your client’s company and help them improve their jobs
Valentin Radu is the founder and CEO of OmniConvert, a growth enabler for mid-size eCommerce websites looking to become customer-centric. It is being used by top companies worldwide, like Avon, Orange, WWF, Wordstream, Whirlpool, etc. Valentin has spoken to over 100 International events over the last six years, including DMEXCO, Mobile Web Congress, SMXL, etc.
In this episode, Valentin talks about how his company, OmniConvert, uses technology that allows its customers to choose different market segments. Through these segments, customers get personalized experiences on all touchpoints Learn more of this in this episode and discover how valuable it is for their customers to get that buying experience.
“I think you should take a look at your churns. So, if you are in the software as a service industry, take a look at your churn. Because once you understand how your churn works for various segments of customers, you might want to change your pricing from being a month to month to annual.”
– Valentin Radu
Topics Covered:
01:32 – Valentin describes what his company OmniConvert does
02:35 – How OmniConvert does market segmentation and its relevance to the buyer’s experience
04:45 – How he orchestrates different messages to different segments
07:33 – Detailing how they educate their customers on what they offer
10:24 – How knowing their target customers and the services they offer relates to pricing
12:27 – Tactics used to determine the segments when customers go to their client’s website
16:19 – Valentin tells other sales strategies to ask questions to customers that don’t look like survey questions
19:21 – The importance of communicating to people inside the customer’s company on their problems and how to help them do their jobs better
21:05 – Valentin answers the question if they teach pricing to their customers
22:10 – Narrating an example when he helped their customer put the right wording around their product that improved their conversion rate by 18%
27:17 – A price of pricing advice that would impact the business of the listeners
Key Takeaways:
“I feel it's highly important that unless you don't know who you need to target, you don't need to spend any penny in an acquisition.” – Valentin Radu
“The first thing and the most important thing is that if you don't know the value that you're giving, and if you don't know who's your target, and if you don't know if you are selling a painkiller or a vitamin, you don't have to mess with the pricing” – Valentin Radu
“This job of optimizing and crafting different website experiences, it's a job of crafting psychological experiences so that people are behaving differently. And that's why you always need to adjust your strategy.” – Valentin Radu
“Things like a buyer's guide for customer experience software is pretty important. And that's why you need to do this kind of material so that you are revealing the value of your product for people, which are different and will look product from different angles.” – Valentin Radu
Connect with Valentin Radu:
- mailto:valentin.radu@omniconvert.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- How to come up with good pricing for cloud-based products
- The goal of waterfall analysis and why companies should do it
- Why you should not be afraid to raise prices
Samuel Saavedra is a pricing professional and commercial deal architect with strong supplementary skills in contract negotiations, contract management, program management, bid management, and proposal response. His strongest industries are Fintech – Financial Services, Telecom – Data Centers and Cloud Services.
In this episode, Samuel talks about how he uses his data center cost models to create the infrastructure cost behind payment offerings, and how he leverages his pricing expertise to develop waterfall analyses across the service portfolio to address revenue leakage and declining margin points, and how data analytics tools help him in adding insights into transactional data.
“Don’t be afraid to raise your price.”
– Samuel Saavedra
Topics Covered:
01:33 – What got Samuel into Pricing
03:06 – Why cost-plus pricing is not enticing
03:50 – Samuel explains how to calculate a software development cost
04:54 – How to partner with companies and gain a percentage of profit through the years you partner with them
06:20 – Challenges on monitoring the actual profit a customer gains for partnering with a software vendor
07:47 – Product Pricing: basis and factors
09:02 – Describing the build-run-cost model of a data center
13:07 – What is cloud-based pricing all about
14:30 – What makes waterfall analysis fascinating and why not many companies are doing it
16:33 – How to go about the waterfall analysis
17:53 – What things to take into consideration when you use data analytics
20:46 – His best pricing advice: “Don’t be afraid to raise your price.”
20:53 – Why you should not be afraid to raise prices
Key Takeaways:
“When it comes to enterprise banking software, the way it’s typically priced is there is an annual license for the software. Then, there’s going to be a base price, like say, it gives you so many millions of payments or wire transfers and so on. And then there’s going to be tiered pricing.” – Samuel Saavedra
“Cloud-based pricing is all about elasticity, scalability, capacity, et cetera. So you figure out what that is based on your assumptions of the customer’s uptake, number of transactions, number of customers growth over time. So you model that. Then they, in turn, come up with their numbers of uptake and growth over time. Once you’ve got the nitty-gritty out of the way, then there’s the actual pricing, which is as you know, what is their perception of the value you bring.” – Samuel Saavedra
Connect With Samuel Saavedra
- Email: samuelsaavedra565@outlook.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn the two mistakes Bill encountered in his journey in pricing and avoid making them
- Know how the sales enablement tool works during the late-stage deals
- Discover how SaaS salespeople were compensated
Bill Wilson is the co-founder and CEO of SalesRight. Over his two decades of working in the Canadian software industry, he has closed millions of dollars in deals — all driven by his dedication to enhancing Canada’s software industry. Bill’s thoughtful and team-centric approach to leadership builds environments that promote innovative thinking and passionate problem-solving. Previous to SalesRight, Bill was the CEO of app-agency MindSea, which has developed some of the top rating apps in North America, often featured by Apple.
How does an expert in developing apps found his way to be an industry thought leader in pricing? And how he effectively channeled his knowledge in complex SaaS pricing to offering intelligent and interactive pricing solutions? Bill Wilson will answer all these questions in today’s episode. Tune in and learn more about the SaaS pricing structure and metrics, how sales enablement tool works, and his concept on sales compensation plans.
“You’ve got to be confident that what you’re doing is worth the money.”
– Bill Wilson
Topics Covered:
01:32 – Bill narrates how he shifted from creating apps to become an expert in pricing
03:33 – Two things that he considers his biggest mistakes in pricing
05:37 – What he found out with value-based pricing
06:19 – Bill explains what the late-stage deals in SaaS are all about
08:50 – Bill tells about the sales enablement tool they used for late-stage deals
12:26 – How to structure pricing
15:39 – How to present complex pricing models
16:29 – Talking about the metrics they use to understand how customers buy
19:38 – Insights on the sales compensation plans for SaaS
21:50 – Bill details what an average contract value (ACV) means
24:37 – A price of pricing advice that would impact the business of the listeners
Key Takeaways:
“We started selling things more in a packaged way. And that was sort of my real introduction into the pricing space because I realize now that it’s basically the core of pretty much everything. One of the surefire ways you want to increase your revenue is to raise your prices, like all of the pricing and context around that. So that’s how I got into it. It was sort of a requirement as I grew the business.” – Bill Wilson
“During discovery and during qualification, we get as much information as we can, and we should know what’s important to our prospects. But there’s nothing like them telling you by actually interacting with the pricing, and they’re looking at some scenarios that you didn’t think of. And that’s the kind of metrics I’m talking about, understanding how they buy.” – Bill Wilson
“If someone sells a deal, don’t dribble in their commission every month. As you get paid, pay them the commission upfront. They’ve got to eat, and they’ve got to see the upside. And if there’s a deal that is sliding sideways and they churn out in six months, will you just clot back off a future deal? Like you don’t. It requires a bit of accounting magic, but you can make it work. And I think it gives the upside and the right place for the salesperson incentivizes them correctly, and also incentivizes them not to bring in people who are going to churn out good clients that see the value.” – Bill Wilson
“I think the biggest thing for me is choice and being able to give people a few options that make sense for them and allow them to participate in that pricing conversation and surface it as early as you can.” – Bill Wilson
Connect with Bill Wilson:
- mailto:bill.wilson@salesright.co
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn how to achieve better outcomes for your customers and products through a customer-first approach
- Understand how you can harness data to produce insights you can use to reduce customer churn and increase satisfaction and upselling opportunities
- Discover why Customer Success is the new growth plan for your company to grow faster
Jay Nathan is a B2B SaaS executive with a deep focus on revenue growth, customer experience and driving customer success throughout organizations. His expertise is in managing and transforming all post-sale customer operations to grow revenue and deliver a differentiated customer experience.
In this episode, he shares how Customer Imperative helps companies scale revenue by deploying customer success teams, processes, and technology. With a deep focus on B2B SaaS, they serve CEOs, CROs, COOs and Customer Success leaders to help grow revenue faster while improving the customer experience.
Customer Success is uniquely positioned within an organization to be able to help identify those opportunities to expand. And in fact, that is where the primary value of Customer Success is.”
–Stacy Sifleet
Topics Covered:
00: 51 – All about Jay Nathan and his role as a Customer Success expert
03:30 – The relationship between Pricing and Customer Success
05:14 – Customer Imperative: what they do for B2B SAAS clients in delivering technology-enabled customer success operations
06:07 – How they help a business to optimize their customer success metrics
07:12 – The system they use to facilitate customer success
08:36 – Customer success and onboarding: the end to end journey roadmap
11:17 – Customer success for retention and expansion: gross retention and net retention, the primary value of customer success
16:58 – 3 basic value levers other than building the right product: market segment, pricing metric, and packaging
17:58 – What is the use of usage data and usage metrics in determining customer success?
22:38 – Jay’s pricing advice: Think Large, think globally. But act pragmatically.
Key Takeaways:
“If you have data that you can normalize across your entire customer base, and even define metrics for your industry, as a SAS provider, let’s say I’m in real estate or event management, there are metrics and their benchmarks that are unique to each of those industries. And if I can sort of normalize those, I can use them in a number of ways one, I can use them to help me understand if my clients how they’re performing relative to their peers.” –Jay Nathan
“The days of planning ahead and building a big top-down plan are just there, they’re hard, they’re gone, right. And we need to be much more agile in the way that we respond to competition and the way that we roll out our products to our clients, in just that agility, just speed means so much we work with a lot of private equity-backed companies.” –Jay Nathan
“I think everybody wants to grow quickly, the idea of testing and seeing what works, and then implementing just that just makes all the sense in the world.” –Jay Nathan
Resources and People Mentioned
-
https://tomtunguz.com/
-
SalesForce
- Zoom.us
- Zendesk
Connect With Jay Nathan
-
https://customerimperative.com
-
Email: jay@customerimperative.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn how Mark discover his pricing superpower through a heartbreak * What it is with LinkedIn’s algorithm that made him decide to build a close-knit community of pricing experts called Champion of Value’ * Find-out what subscription value management is all about
Today, we have no guests. It’s just going to be Mark talking about the far better things ahead with Impact Pricing.
Listen in to hear the exciting things that Mark has in store for companies, entrepreneurs, and experts that will help them price offerings to capture more of the value they create.
“In pricing what we have to do is we have to look at each person’s decisions. They’re going to buy my product or not. They’re going to buy my product or my competitor’s products. They’re going to make that decision in their own best interest. And our job has to be to understand that decision they’re about to make and help them understand that it’s in their best interest to choose our product.”
– Mark Stiving
Topics Covered:
00:51 – Jay Baer of Convince & Convert talk at National Speakers Association Conference, what is the issue with LinkedIn viewing analytics for your shared posts that unable followers to see your content
02:22 – Mark discovering his pricing superpower through a heartbreak, why people make a decision in their own self-interest
08:20 – Why Mark can’t trust Linkedin- not getting your content out to everybody who wants to see it
08:33 – Building the Champions of Value community and the launch of Impact Pricing’s upcoming courses
09:32 – Subscription Value Management
11:05 – Solo cast, Interview, or both? What do you want to hear?
People and Resources Mentioned
- Jay Baer of Convince & Convert
- National Speakers Association
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn how pricing in retail is done, the strategies to implement to get the right data analytics for value pricing * Why throwing out a number before a customer tells you your value to them is a mistake * Understanding the impact of category management on retailer prices and performance: theory and evidence
Stacy Sifleet is a consultant whose expertise includes pricing strategy, business process improvement, change management, inventory, S&OP, advanced problem solving, strategic planning and procurement.
In this episode Stacy shares how using data analytics, correctly, identifies value levers for customized pricing, especially in the B2C market.
“I think it is important that once you figure out what you want your pricing strategy to be, figure out how to make it easy for your team to execute it.”
–Stacy Sifleet
Topics Covered:
00:45 – Stacy’s backstory in pricing
01:22 - Her biggest mistake in pricing: Why throwing out your number to a customer without knowing your value to them is a mistake
06:10 - Differences between B2C and B2B in business systems’ pricing
08:53 - How using data analytics, correctly, identifies value levers for customized pricing
09:40 - What is category management is all about and its relation to value pricing
16:11 - How pricing in the retail industry is done?
20:39 - Stacy’s favorite data tools and strategy she implements to get the value pricing right
Key Takeaways:
“When I think about B2B, I think the sales team, even if the're working on a specific account, they really should be diving into the data across their account and say.’ How are these customers different? Which of these customers add more value to the business?' You cannot do that just by conversation, you have to look at the numbers.” –Stacy Sifleet
Connect With Stacy Sifleet
- https://www.supplyvelocity.com
- Email:stacy@supplyvelocity.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn how pricing audit relates to growing a company’s value * You will learn why there is a need to document processes to increase a company’s valuation * Understanding the role of an exit strategist and value growth advisor in terms of the goals the company wants to achieve
Kerri Salls, MBA, CVGA is a certified value growth advisor, author, and speaker. She works as a value growth advisor to underperforming and closely held businesses by helping them to revamp and improve operations for sustainability and scalability.
Added to this, she is also a podcast show host of 3x Value Growth Podcast.
In this episode, Kerri shares how she operates at the intersection of strategy, systems, and value growth to help middle-market companies multiply value three-fold in three years. Just as it is important to build a product with value, Kerri helps build companies with value.
Tune in to this episode to know more.
“What is value? I am focused on the enterprise value itself-stand alone enterprise value-but where that comes from is your vision of value you want inside your company.”
-Kerri Salls
Topics Covered:
01:45 - The difference between value growth and exit strategy, in term of growing a company’s worth
03:00 - Skillset of a value growth strategist and an exit strategist in terms of strengthening a business
05:36 - What is value for a company and how do you judge the value strategy prior to the exit
07:42 - How does value relate to a market capitalization
10:23 - Does increasing profit margin also doubles the value of the company?
11:26 - How does documentation processes improves a company's valuation
13:31 - Common problems Kerri helps solve in companies she helped out
16:19 - Difference among advisor, consultant, mentor and coach
17:39 - Thoughts of her being the ‘chief investigator of a company’ to look for what is broken and the red flags
18:12 - How Kerri does her ‘value audit’, the places that usually had the red and yellow flags
Key Takeaways:
“The value on an outside basis just keeps rolling up and up and up. I've seen clients who start at eight and 9% who get to well above 20%. I have client stories that I do in my webinar wherein less than two years they are increasing the value of their business, 300 400, 500% just because we are giving them the structure and the foundation and we're taking the owner out of the hot seat of being the gatekeeper for every one of those decisions. Now there's a structure in place so they can indeed take that three-week vacation even without the cell phone.” - Kerri Salls
“Every one of those elements that make you more understood as being like a public company because you're so well managed--that increases value. That can't be taken away from you, that they can't whittle it down when you're in a competition about pricing.” - Kerri Salls
Connect With Kerri Salls
- 3xvaluegrowth.com
- Email:kerri@valuegrowthresults.com
- Podcast
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Understanding the complexities each organization have involving pricing and zeroing in on how to capture a product’s full value * Understanding Fear and Competence when talking about value pricing, digging deep into how to do it (increasing prices) side by side with the confidence to do it * Getting an overview of a masterclass about value pricing and what value can you get from it
Adrienne Gordon has a passion for the power of pricing. She has dedicated her career to pricing since 1999, working with multiple companies in several different pricing roles. She began her pricing career at Parker Hannifin as the project manager of their global strategic pricing initiative. During this time, Adrienne worked with multiple consulting groups and revenue optimization technology companies as she helped architect the vision for Parker’s Best in Class pricing approach. From there, Adrienne took the Director of Pricing role at American Greetings, where she executed a multi-phase value pricing research effort ultimately resulting in the redesign of their approach to pricing cards. At Eaton Corp, she worked with several different businesses on strategic projects as an internal consultant. Finally, in 2009, Adrienne became an external pricing consultant based in Northeast Ohio, working with dozens of companies in the manufacturing and distribution space. Today, she is a blogger, author, and entrepreneur. Prior to pricing, Adrienne held several roles in Technical Sales and Marketing. She holds an MBA in Marketing from Western New England College and a Bachelor’s in Engineering from Boston University.
In this episode, Adrienne takes us to dig deeper into the culture of fear in pricing that is pervading an organization. She manages to uncover bit by bit where this fear is coming from at the same time provides a perspective where all these fears can be removed thus capturing a full value for a product. With an expertise spanning two decades, she has but a lot of inputs to share about winning deals even when you increase prices, where most organizations are afraid to toe in.
“When in doubt, offer versions and your customer will opt into the best value proposition for themselves and you'll learn a ton about your business.”
- Adrienne Gordon
Topics Covered:
01:07 - What got her into pricing
02:46 - Scope of her work as a pricing manager at Parker Hannifin
05:57 - Where is the culture of fear in pricing manifesting in an organization
06:57 - Her thoughts on companies building a great product but not good at capturing value for their product
08:46 - How to fix that culture of fear of pricing in an organization
09:41 - How to remove fear to capture a full value
10:36 - Of fear, of competence, of metrics and of analytics. How do these relate to pricing and value
15:11 - How do I do it versus do I have the confidence to do it
16:58 - How to win deals even when you increase prices
18:51 - Tools to help companies have the confidence in going about their value pricing
19:32 - Talking more about the masterclass she is offering on value pricing
20:14 - Who is this masterclass for
22:08 - Giving her best advice on value pricing to impact your business
Key Takeaways:
“So companies that think about this, in my opinion, in the right way, look at it as a process. Knowing that it's not going to be perfect, we're going to have an opinion on our strategy, we're going to execute it flawlessly, we're going to measure what happened. I'm going to optimize that strategy. It's very simple. And I think when leadership can articulate that, that's how they want to approach pricing from a continuous improvement process standpoint. It gives their teams the comfort that it is gonna be okay, a little bit of failure is okay cause we're going to learn and we're going to get better.” - Adrienne Gordon
“And so all the work that a lot of organizations do around pricing around the data science, around this strategy and testing and the research, It's all good stuff, but at the end of the day, it's really just taking that information and getting it in front of a person to say it's okay to ask for a little bit more.” - Adrienne Gordon
“Leadership will never be effective at attaining their full value unless they recognize their job is to remove the culture of fear.” - Adrienne Gordon
Connect With Adrienne Gordon
- pricingempowered.com
- Email: info@pricingempowered.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Discover how Rondalynn is helping accountants understand how to add value and why she thinks branding, social media, and marketing are a waste of money * Know how Rondalynn helps accountants find their clients’ “thirst” and “hunger” and make their pains more painful * Get to know how neuroscience affects pricing that will let your clients say yes to your solutions
Rhondalynn Korolak is the Managing Director of businest, a simple and effective tool for greater time focus and profitable growth. Rhondalynn is a lawyer, chartered accountant, best-selling author and business coach. She has a wealth of 20 years of senior management and business coaching experience, which enabled her to uncover the secrets of business success. She was able to produce a simple, step-by-step process to boost sales, bottom line and cash flow. Her consulting work focuses now in the accounting industry.
Rhondalynn shares a whole new concept of neuroscience affecting pricing. Imagine making it easier for people to say yes to the value you will give without the tricks or any force to do it. Further, she will provide in-depth discussions on the six C’s of pricing to effectively create value to your clients. Listen as she connects the two concepts that she is passionate about - teaching accountants to ask questions and find value, and using emotions in making decisions. Tune in as Rhondalynn will give exciting peeks of her best-selling books in today’s exciting episode.
"I don't spend all heaps of time on convincing. Because if you can lay the proverbial breadcrumbs like a Hansel and Gretel, all the way along in the process, you shouldn't have a hard time to close people. They should be dying to say yes. If they're thirsty for what you have and you've got a glass of water, they'll pay any price for it. That's my philosophy.”
– Rhondalynn Korolak
Topics Covered:
01:40 – Sharing why she is passionate about helping fellow accountants to improve soft skills
02:57 – How she is helping the accountants to understand how to add value and why she thinks branding, social media, and marketing are a waste of money
03:59 – Mark discusses the three Cs of pricing
04:31 – Rhondalynn explains her six C's of pricing
05:38 – Why she thinks finding clients is a value desert, as described in Chapter One of her two books - Pricing Value and From Value Pricing to Pricing Value
06:48 – How she helps accountants find the “thirst” or “hunger” of their clients
08:30 – The compelling reason why Rhondalynn advises accountants to ask questions and listen to their clients first
10:28 – An interesting relationship between neuroscience and pricing
11:27 – What Price Club is all about and the rules of pricing
12:11 – Why she is passionate about neuroscience
13:04 – How she ties the two concepts of teaching accountants to ask questions and find value, and using emotions in making decisions
17:26 – Understanding cashflow so simple that a 6-year old kid can get it, as written in her book Financial Foreplay
18:22 – What a deal-breaker is and a few examples
20:07 – A price of pricing advice that would impact the business of the listeners
Key Takeaways:
“People make pricing decisions that are largely driven by survival and emotional cues.” – Rhondalynn Korolak
“That's why I'm really passionate about focusing on neuroscience because it's how we make it easier for people to say yes. We're not trying to trick them into it. We're not trying to coerce them into it. We're just packaging up our message so much more in a simple fashion that it's just easy for the brain to go yet. I'm thirsty. I need that solution right now. I say, yes, that's it.” – Rhondalynn Korolak
“I’ve always believed that people tend to make that first decision emotionally and then they have to find a way to justify it.” – Mark Stiving
“If you go into the relationship thinking to value price something, you're going to make a mistake probably. And that mistake is you're going to be thinking about, what do I need to get? I want you to go into that relationship thinking, how do I add more value? Adding more value first earns you the right to be able to put your prices up. So please enter the relationship thinking about how are you going to create more value first and then the pricing is only 5% of it. That's the easy part.” – Rhondalynn Korolak
“Whether you need tier pricing and should your prices end on a nine. All that stuff is job number two. Job Number one is, please remember that your job is actually to add more value first.” - Rhondalynn Korolak
Check out and read Rhondalynn Korolak’s books:
- Pricing Value: The Art of Pricing What Your Accounting Clients Value Most
- From Value Pricing to Pricing Value: Using Science, Psychology, and Systems to Attract Higher Paying Clients to Your Accounting Firm
- Financial Foreplay: Whip Your Business Into Shape - Take Home More Cash
Connect with Rhondalynn Korolak:
- mailto:rhondalynn@businest.com
- businest.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out Today’s podcast:
* Learn the rules and tactics to charge more for new work and run a more profitable business
- Know the pricing training his company offers to creative companies and how it benefits them
- Discover and learn the four conversations in a sale and how to successfully apply it to boost your sales conversation and presentation
Blair Enns is the author of The Win Without Pitching Manifesto and Pricing Creativity: A Guide to Profit Beyond the Billable Hour. He co-hosts, along with David C. Baker, and the podcast 2Bobs: Conversations on the Art of Creative Entrepreneurship. Based on the remote mountain village of Kaslo, British Columbia, Canada, Blair lectures throughout the world on how creative professionals can win more business at higher prices and lower cost of sale.
In this episode, Blair shares the ups and downs of the business side of creativity. He takes us into the pages of his books sharing the principles behind pricing creativity, sales conversation and winning without pitching. He also deep dives into the rules and tactics to help creative professionals charge more for work and how to train their clients to a value-based pricing rather than hourly billable hours.
“I cannot think of a more valuable skill in all of business than the ability to conduct a value conversation which is to essentially find out what the client or the customer wants, and what they would be willing to pay if you could help create that value ”
*– Blair Enns*
Topics Covered:
02:31 – How Blair got into pricing
02:59 – What his company does and the type of professionals they serve
05:33 – Citing examples of creative companies
06:42 – Talking about the training on pricing his company also offers
07:38 – Blair explains putting a stake in the ground which is detailed in his book - The Win Without Pitching Manifesto
10:09 – Two most essential lessons for creative firms
12:52 – How they train their clients to a value-based pricing
15:00 – The four-step framework and four-step pricing guidance discussed in his book Pricing Creativity: A Guide to Profit Beyond the Billable Hour
19:05 – The four conversations in the sale
26:37 – Mark asks for feedback on the ways they apply value conversations in product companies
29:35 – Advice for product managers
32:05 – Blair explains why and how he priced his book that much
34:56 – A piece of pricing advice that would impact the business of the listeners
Key Takeaways:
“You need to put a stake in the ground. And the mistake that people make is that stake or that claim of expertise is too broad in terms of both the discipline on the market. It should be narrow enough in a way that allows you to be compelling and meaningfully different.” – Blair Enns
“A customized service means you have a small number of clients at any one time.” – Blair Enns
“If you can help this client create the value that you've uncovered, then your idea of fair compensation for yourself really needs to transcend the idea of your inputs or how long it's taken you to do to help create that value.” – Blair Enns
“The goal of value-based pricing is to create an organization filled with people like that who are laser-focused on the client and how they can help create value for the client.” – Blair Enns
“Options with a high anchor. If you just always put forward options, three options and lead with the most expensive one. Your average settled price will go up, I promise you.” – Blair Enns
Resources Mentioned:
- Pricing Creativity: A Guide to Profit Beyond the Billable Hour
- The Win Without Pitching Manifesto
Connect with Blair Enns:
- winwithoutpitching.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn the not-so-good strategies that companies do using subscription pricing
- Know the pitfalls in subscription pricing
- Discover what a pricing roadmap is and how is it related to big business decisions
Laura Fay is currently the VP Research & Advisory of XAAS Product Management for Technological Services Industry Association (TSIA) and founding member of Health Tech Capital. Laura is a technology industry veteran with over 30 years of experience driving business growth in the enterprise software industry via leadership roles in product management, general management, product development, and customer success.
In this episode, Laura, who is a results-driven person and a very successful in driving enterprise software growth shares her perspectives about the role of pricing on subscription-type businesses and the relationship between pricing and product management. She will also reveal the pitfalls that she found out in subscription pricing and how value metric and pricing metric are differentiated.
“If you’re going to build a pricing model based on your value proposition, you've got to understand at a deep level how the customer is getting value from the solution.”
– Laura Fay
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:20 – Laura tells a brief background and the business model of TSIA
03:13 – Her role in TSIA
04:08 – How pricing fits with product management
05:13 – The role of pricing on subscription-type businesses
07:13 – Relationship of pricing and product management
08:38 – What companies don’t do well when it comes to subscription pricing
13:35 – Estimated percentage of businesses that will not transition to subscription pricing in the next five years
16:22 – Two pitfalls that Laura sees in subscription pricing
18:58 – The difference between value metric and pricing metric
23:06 – Two stages of the pitfall in timing when product management starts to think about pricing
26:18 – Pricing roadmap and what it means
27:49 – A piece of pricing advice which could impact the listeners’ business
Key Takeaways:
“Understanding the value proposition that's being delivered and getting into those level of detail of understanding the customer process, how they use the product so that you can start doing that alignment of value and pricing. It's not something you can turn on a dime overnight once you suddenly decide to do it. So, having a point of view on that earlier in the game and evolving it is pretty critical.” – Laura Fay
“I know the timing thing is only thinking about pricing at the launch phase and not thinking about pricing during the product design, and the offer design phase because they are interdependent. You might choose to move things around and how you put your packages or your solutions together, how you put your product suite together and what features, functions and capabilities and use cases and value go into each element in the portfolio. And that's going to pose how you price it. But if you don't think about that until the very end, you're probably missing an opportunity.” – Laura Fay
“Product managers should be called value managers because ultimately, that's what their job is. The promise of that value proposition is the promise of the product, and that is to put a value proposition that you're going to realize when you purchase whatever solution they're defining and building.” – Laura Fay
“The remit of product management to understand how the customer is perceiving that value that they're creating and then leverage that in into their pricing design.” – Laura Fay
Connect with Laura Fay:
- mailto:laura.fay@tsia.com
- tsia.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out Today’s podcast:
- Learn how pricing and sales process are connected
- Discover what sales team needs from the product or marketing team to help them sell value
- Know who in charge in prospecting
Liz Heiman is the Chief Strategy Officer and Sales Leadership Coach at Alice Heiman, LLC wherein they help B2B companies grow rapidly by developing strategies that drive revenue and sales organizations to support it.
In this episode, Liz will give us an in-depth understanding of how pricing and sales process are very closely tied and how these areas will substantially help the salespeople understand pricing through their sales process.
"Every time we drop the price in a negotiation, we're dropping profit way more than the percentage of the product. So we want salespeople to do everything possible to not negotiate on price."
– Liz Heiman
Topics Covered:
03:20 – Liz explains how capturing prices help salespeople understand the value of products
06:52 – What a salesperson needs in terms of the value proposition
10:38 – What sales team needs from the product or marketing team to help them sell value
11:59 – Importance of collaboration in crafting the value proposition between the marketing and the design team
14:21 – Building products that solve problems in the marketplace: Don't just start a business, solve a problem
17:01 – Product-Market Fit: Two examples of creating a solution but it wasn’t a problem people wanted to be addressed
21:10 – Dealing with the psychological aspects of pricing
23:24 – Talking about prospecting and identifying whose job is it
26:13 – Pricing advice from Liz: “Make sure your salespeople understand when they negotiate on price and drop that price, they set an expectation in the future, and we do not want to do that.
Key Takeaways:
“I don't think that sales or marketing ever stands alone in any solution. If we're not bridging the gap between sales and marketing. If they're not partnering in solutions, then you have a problem.”
– Liz Heiman
“Not only do people have a problem, but they're willing to spend the money to solve the problem before you go out and spend a lot of money creating a solution.” – Liz Heiman
“In a lot of ways, a salesperson has to deal with all of these emotions and overcome them. And sometimes look at a situation and go. There's no way this guy, we talk about certain kinds of basic objections that you can't overcome.” – Liz Heiman
“What's important when you're prospecting is to have a very clear definition about ideal customer profile and also a qualified lead. So, what marketing identifies as a qualified lead, and what sales identify as qualified lead may be very different. What we want to do is merge those two things.” – Liz Heiman
Connect with Liz Heiman:
- mailto:liz@regardingsales.com
- aliceheiman.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn why without the ability to have this conversation, value pricing is dead on arrival * Know why value conversation is the most valuable skill in business * Learn how to discipline yourself not to be a ‘solutionist’ and not offer solutions too early in the process
You can't do value pricing without having a conversation about the prospects problems and pain points. The way you talk to customers has a significant impact on your brand, and nothing delivers customer satisfaction quite like consistently valuable communication.
Ed Kless is an expert in value conversation, the Senior Director of Partner Development and Strategy at Sage - a SaaS-based product company, and the co-host The Soul of Enterprise with another value pricing expert, Ron Baker.
In this episode, Ed will dissect the process of creating value discussion, how to do value billing. Ditch the time sheets, frustrated clients and employees, and make more profits.
“How you sell is a free sample of how you will solve.”
– Ed Kless, quoting Mahan Khalsa
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:30–Ed’s back story how he got introduced into the pricing industry through Ronald Baker book - Professional's Guide to Value Pricing
02:28 –Ed does not believe in timesheets, moving away from billing via the hour
04:10 – Comparison between a consultant and a technician in terms of delivering service
05:00 – Value conversation components: the cost, the price, and the perceived value
8:27 – Value conversation explained - ‘How you sell is a free sample of how you solve.’ - Ed quoting Mahan Khalsa
11:33 – People need to be heard - why it is crucial in your value conversation
16:44 – Mahan Khalsa’s Five Golden Questions
- How do you measure it?
- What is it now?
- What do you want it to be?
- What is the value of the difference?
- Over time (usually one year)?
17:39 – Value conversation for product marketing as suppose to making sales
22:01 – The four steps to move off the solution: Listen, Assuage, Move and Close
27:12 – A piece of pricing advice from Ed– “Offer choices. Do not hesitate to come up and compete with yourselves to try to develop choices for the customers.”
Key Takeaways:
“What people want is that they want to felt listened to.” – Ed Kless
“Prospects as other human beings can sense that [when you are not listening] as well.” – Ed Kless
“Even when there is competition, and we make value conversation, people trust us more. They believe us more.” – Mark Stiving, quoting Ed Kless
People and Resources Mentioned
- Ronald Baker
- Peter Black
- Mahan Khalsa Let's Get Real or Let's Not Play
- The Soul of Enterprise: Episode 182 - How to Have a Value Conversation

Connect with Ed Kless
- www.edkless.com
- The Soul of Enterprise

Connect with Mark Stiving
- Email: mark@impactpricing.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Learn more of the meaning of value
- Discover the two best-selling pricing and negotiation books that B2B companies are raving for
- Know the differentiators that will drive prices
Reed Holden is an author, keynote speaker, coach, and founder of Holden Advisors– a team of seasoned practitioners that provides B2B pricing and negotiating advice to clients builds go-to-market strategies.
Reed specializes in helping sales teams avoid the procurement buzz saw by implementing strategies to recognize and counter margin-reducing buying tactics.
Today’s episode steers on the definition of value and the different methods to analyze it. Know how services, products, and other differentiators will drive prices, especially if there is heavy competition. Reed will tell more of his expertise in B2B pricing through his must-read and thought-leading books – Negotiating with Backbone and Pricing with Confidence.
“Conversations with procurement people are like playing a game of poker. And the way to win the game is by bluffing. And unless you’re prepared to play the game back, you’re going to lose each and every time.”
– Reed Holden
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
02:02 – Reed back story as a luminary in Pricing
03:34 – The definition of “value” according to Reed
04:52 – Various analysis made when value is in use
06:36 – The value in using ROI calculators
08:57 – Why focusing on the value of a product will increase the likelihood that customers will buy it
10:36 – Telling about the Negotiating with Backbone book and why you should read it
13:35 – How Reed coaches a company about value and shares the related contents in his Pricing with Confidence book
15:38 – Narrating a short story inside this book about a company selling dirt
21:10 – How other services and other differentiators will drive prices if there is substantial price competition of the product
27:12 – A piece of pricing advice from Reed – “Keep it simple.”
Key Takeaways:
“In the world of B2B, we have this amazing advantage that says, if you can’t put a dollar value on a feature, on a product, as in how much money your customer is going to make or save because they bought your product, no one’s going to buy your product.” – Mark Stiving
“As we get into sales teams in organizations that had deployed Roi calculators, one of the biggest problems that organizations have is the salespeople don’t use them. And if the sales people don’t use them, then certainly customers don’t see them.” – Reed Holden
“Nobody buys a product feature. People only value of the product and so they teach their salespeople about the product and the product features. I’m talking about the product and the product features and no wonder we never capture value is this.” – Mark Stiving
Resources mentioned:
- Negotiating with Backbone
- Pricing with Confidence
- The Strategy and Tactics of Pricing – Second Edition
- The Strategy and Tactics of Pricing – Third Edition
Connect with Reed Holden:
- mailto:rholden@holdenadvisors.com
- holdenadvisors.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Learn how the Business to the Government (B2G) procurement process happen to help you understand how to sell to governments * RFP: Cost Plus Pricing Model and Business Case-Based Pricing: Learn more about how value pricing model works when dealing with government * Negotiation in public procurement: Crafting alternate proposal and why government procurement teams do not sometimes consider it
Chris Street is a value expert, an experienced analyst within the aerospace and defense sector. He can be found driving the implementation of Position-to-Win and Value-Based Pricing across Thales UK with occasional cameos in Paris. He earned his Business Studies at the University of Brighton.
In this episode, Chris shares his expertise when it comes to Business to the Government (B2G) procurement process. He will also give us an overview of the procurement process every government sector goes through and use that knowledge to gain an unfair advantage against competitors in a bid to win contracts.
“Always understand your competition, understand what makes them different, what makes them special, but then understand what value you're bringing and what makes you special as well. If you don't understand the competitive environment, you've got no way of being able to articulate why you're different, what makes you special.”
– Chris Street
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topic Covered
01:27 – Chris sharing his career background
04:10 – The best pricing value of a product to be sold to government or military
04:58 – The request for quote process and the important details about it
05:48 – How to figure out a competitors pricing model
07:21 – How much profit margin are you willing to have to secure the government's contract with them
08:23 – Explaining the Business Case-Based approach
09:40 – Discussing the Cost Plus Pricing approach and sole source bid
10:01 – The advantages of going competitive rather than a sole source bid
13:13 – Relevance of metrics in the CRM and RFM
15:25 – Thoughts on "government or anybody writing RFP are not experts"
18:00 – Procurement team power: B2B versus B2G
19:45 – How many proposals to give when responding to RFP
22:16 – What transpires after you win a contract with the government
Key Takeaway:
“Everyone thinks their own technical features are unique and amazing, but ultimately if your competitors are doing the same thing, you've got no differentiation, you've got no ability to grab someone at a premium. So my advice is, keep an eye on what those competitors are up to. Make sure that you're staying one step ahead.” - Chris Street
Connect with Chris Street:
LinkedIn
Twitter
Connect with Mark Stiving
Email: mark@impactpricing.com
LinkedIn
Twitter
Why you have to check out today’s podcast:
- Discover the concept of dynamic pricing to help you keep pace with constantly changing market dynamics
- Learn how to maximize your business ‘profit with predictive analytics and powerful artificial intelligence (AI) pricing strategy
- Know the definition of artificial intelligence (AI) and machine learning
Alexander Shartsis is the co-founder and CEO of Perfect Price, an artificial intelligence (AI) company empowering companies to make better decisions about pricing, profitability, and utilization. He is an entrepreneur and executive with a background in business development, sales, product, and engineering. He is a member of the Forbes Technology Council. He wrote a book called The Ultimate Guide to Pricing Strategy: A Playbook for Behavior-Based Pricing and Promotions. Alex holds an MBA from the UCLA Anderson School of Management, an MSc from the London School of Economics, and an AB from Dartmouth College.
In this episode, Alexander shares his expertise in the dynamic pricing model, which industries use it, and will it be harder to use it on a subscription type of business over the traditional ones? You’ll also get to understand the concept of artificial intelligence and machine learning and how they are associated with pricing strategies. Further, learn how his company, Perfect Price, delivers artificial intelligence for pricing that will significantly impact your company’s revenue.
“Always put yourself in the customer's shoes or just out of your own world of being a pricing professional and try and think about it differently. And maybe you'll come to the same conclusion or maybe you'll, you'll have an epiphany and think about things totally and differently. Letting go of your assumptions and your conviction of being right about how you're doing things today is a really powerful tool.”
– Alexander Shartsis
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:32 – Alexander’s shares how his focus in bringing technologies got him into pricing
03:20 – The concept of dynamic pricing
05:08 – Car rentals and car manufacturers as examples of industries which use dynamic pricing
09:28 – Two ways to achieve dynamic pricing: demand-based pricing and market trend
12:25 – Gathering outside data to predict demand or willingness to pay
13:10 – The overlooked significance of a company’s own data – actual purchase data and web traffic data
17:24 – Example of an AI pricing strategy
18:20 – Definition of AI (artificial intelligence) and machine learning, and specifying Google Translate as a good example
22:34 – How Alex’s company, Perfect Price, provides data with the companies to get the results they want
25:23 – Difference of subscription business from the traditional types in terms of dynamic pricing
27:41 – A piece of pricing advice from Alex – “Be really open-minded about pricing. It's really easy to get emotionally attached to the way you've been doing things.”
Key Takeaways:
“It becomes much more about, how are you framing the problem? And I think the key difference with AI is learning from the data, as opposed to making a bunch of human understandable assumptions.” – Alexander Shartsis
“The thing that's almost always overlooked by companies is their own data.” – Alexander Shartsis
“In our opinion, wherever you're running an AI pricing strategy, you do need some human control over it.” – Alexander Shartsis
“It's hard to do dynamic pricing for anything where the consumer or buyer really has a solid expectation of price. And that can be subscriptions.” – Alexander Shartsis
“It is so often that we start down some path for whatever reason. It's easy as a startup company. We price it this way, and that's mostly internally focused, not externally focused. And as soon as we step back and start thinking about customers and willingness to pay and how it changes in situations, suddenly, we have so many more doors, so many more levers we can pull.” – Mark Stiving
Resources mentioned:
The Ultimate Guide to Pricing Strategy: A Playbook for Behavior-Based Pricing and Promotions
Connect with Alex Shartsis:
- perfectprice.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Know how to find the right value metric for your business
- Learn the difference between subscription and recurring revenue
- Discover the strategies in packaging and pricing metrics
Kyle Poyar is the Vice President for Market Strategy at OpenView since 2016. He is responsible for helping OpenView’s portfolio companies accelerate top-line growth through deep insights. He leads segmentation, positioning, channel/partner strategy, new market entry, and packaging/pricing initiatives, partnering closely with portfolio leadership teams. He also covers OpenView’s SaaS metrics and benchmarking research.
Previously, he worked for Simon-Kucher & Partners as a Pricing Consultant for six years. Kyle earned his AB Economics & Environmental Studies at Brown University. He graduated Magna cum Laude and with departmental honors in Environmental Studies.
In today's episode, Kyle shares his pricing journey and his perspective on how pricing is essential in decision-making. Check out his expert advice that will undoubtedly impact your business to its optimum level.
“Pricing is the tip of the spear. It's a pain point that's universal among companies, especially among earlier companies. But then once you do a pricing project, you uncover so many areas of opportunity for follow-on work.”
– Kyle Poyar
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
02:59– Kyle talks about why he thinks pricing is a Trojan horse, a spear and a pain point among companies
04:12 – Sharing the reasons why he left Simon-Kucher & Partners (SKP) and moved to OpenView
06:31 – Talking about OpenView’s expansion team and the pricing challenges he encountered in their early stages of the business
08:41 – Company in expansion stage defined
09:49 – Customer Lifetime Value (LTV) as a marketing metric, and what it reveals about the status of your business
11:22 – Spearheading the SaaS benchmark initiative as Kyle’s first roles at OpenView
13:15 – Subscription and recurring revenue, understanding both revenue streams
15:44 – How he helped one company pivoted from subscription to recurring model
20:03 – Difference of packaging from pricing metrics: the good, better, best services
24:08 – Not spending time to look at pricing as one of the biggest pricing problems that subscription companies currently have
27:32 – Pricing advice to listeners – “If you start getting involved in thinking about what model (free trial or freemium models) could look like and what are the KPIs for it in your business, that elevates the role of pricing in the organization and helps you stay relevant with your users.”
29:43 – His opinion on the similarity of designing the sales force out of the system and product-led growth
Key Takeaways:
“I think the biggest ‘AHA’ moment for CEOs is when someone finally tracks the revenue impact of pricing changes and they start counting all of the dollars that they're making from making a pricing change. It's amazing if you can bring proof points around impact and real dollars and cents. I think you can change minds quickly.” – Kyle Poyar
“The early stages of business founders tend to undervalue their products. They start with extremely low pricing, and they don't change that and increase it. There's just a ton of opportunity in the early stages for business to increase prices and in many cases, not even seeing any sort of impact to win rate or conversion, just additional revenue, and bottom-line profitability.” – Kyle Poyar
“Subscriptions is a great business model for a lot of companies, and obviously the investors recognize that and are willing to pay a premium for subscription companies. But you can get a lot of the same characteristics without actually having any sort of commitment for your customers. That can be a disruptive value proposition. And I think the investors will recognize companies that are disruptive and winning in the market and reward them.” – Kyle Poyar
“I think structurally speaking, companies are not spending enough time on pricing. The biggest challenge is just a lack of great pricing skills and then more tactically for businesses. It's a very competitive world in technology right now.” – Kyle Poyar
Resources mentioned:
- Mastering SaaS Pricing
- SaaS Metrics
Connect with Kyle Poyar:
- openviewpartners.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast:
- Discover how Chris Hopf's pricing metric decision guide can help you evaluate your options and confirm your existing pricing approach
- The difference between pricing metrics and value metrics and discover why not all value metrics should be used as a pricing metric
- Know how understanding your customer better through metrics can help you achieve your revenue goals faster and with more confidence
Chris Hopf worked for more than twenty-five years as an owner, employee and as a consultant with small startups, mid-sized mergers and Fortune 50 Corporations such as Microsoft and United Technologies.
He helps client companies clearly communicate their value advantages, convert more prospects, keep more customers and capture their markets' full profit potential. His experience spans a number of industries including software, technology, IoT, AI, ML, digital media, retail, publishing, general and specialty contractors, industrial suppliers and wholesale distribution and more.
In this episode, Chris shares his pricing journey, all about his decision guide tool for pricing that helps determine business profit, and the importance of understanding the customer to help you increase your pricing confidence.
“Pricing confidence comes from value clarity.”
- Chris Hopf
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:10 - Chris’s pricing backstory and how he got involved in pricing in every company he worked for
02:37 - The story behind his ‘Decision Guide for Pricing Metric’
03:26 - The difference between value metric and pricing metric
04:15 - Mark’s insight on value metric versus pricing metric
11:20 - Different evaluation example using his ‘Decision Guide for Pricing Metric’
19:45 - How pricing metric encourages per use or charging per user
22:40- Examples of what a company don’t measure in terms of internal execution
23:49- Creating your pricing metric, differences and cost impact
26:08 - Chris valuable advice: "Give your pricing a chance. One of the best ways to really inform your pricing should always start to understand your customer.’"
Key Takeaways:
“Pricing metric is what we look at the seller side and the value metric is what we look at the buyer side.”- Mark Stiving
“Pricing confidence comes from value clarity. So the more you increase your value clarity the better you understand your customer and the difference you make and what they care about what they’re trying to accomplish, you will simultaneously also be increasing your pricing confidence.” - Chris Hopf
Connect with Chris Hopf
- pricingwire.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Why you should charge a premium fee for your services * Why undercharging is killing your business * The halo effect of premium pricing: How to use it for your business
David Newman specializes in working with speakers, authors, consultants, and independent professionals who want to stop throwing money into a marketing black hole and attract, engage, and win more clients. He’s been running his own business called Do It Marketing for 18 years. He earned his CSP, Certified Speaking Professional from National Speakers Association. David hosts his own podcast called The Speaking Show.
In this episode, David will walk us through the ideas and strategies of charging a premium price for your product and services.
In his vast experience as a speaker and consultant to various big firms in different industries and to solopreneurs, be assured he will share the relevant pricing tactics of reinforcing that psychological perception of premium products and services.
“You have to charge premium fees before you think you are ready to charge premium fees. Your pricing is your positioning. And your positioning is integrated into your pricing. ”
– David Newman
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
01:44 – Relating his transition from being a corporate consultant to helping other speakers raise their game
03:33 – The feeling of fulfillment seeing his clients reach their goals
04:43 – His thought on ignorance and undercharging your services
08:12 – Why do people hire speakers? Is it for content or delivery?
12:21 – Influence and Differentiation in a pricing frame of mind
14:51 – How much should you price your service as a speaker
18:54 – The halo effect of premium pricing: How to use it for your business
19:48 – On pricing less than what you are really worth
23:47 – The value of premium pricing
25:31 – Pricing advice from David: “People buy who they are, they really buy who they are. There are passengers on an airplane that always fly economy, would never think of business class or first class because it doesn’t match their identity. It’s not who they are.”
Key Takeaways:
“The more research that you do about what's the going rate in your market, in your topic for your level of expertise, you will be shocked. You'll be shocked and stunned about how much you should be getting. Because we always underprice ourselves and we always overestimate the value that others deliver.” - David Newman
“When people pay more, they pay more attention. They value your product more just because they paid more and then they implement more and then they get more results.” - David Newman
“When you're not offering something at a premium price, I guarantee you that you're leaving money on the table. People that want the biggest, the best and the most expensive, if they don't see it with you, they're going to go find it with somebody else. ” - David Newman
Connect with David Newman:
- doitmarketing.com
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Find out how the HAAS Alert technology prevents road collisions * Discover the pricing approach used on direct selling vs indirect selling through channel distribution * Learn how customers can save more on paying upfront fees vs annually on a five-year plan
Jeremy Agulnek is the Vice President of Connected Car at HAAS Alert since October 2017. His start-up company offers real-time collision prevention system on roadways through its HAAS Alert Safety Cloud technology. He brings in years of sales and product management expertise from the various technology companies he joined in the past. Jeremy earned a BS in Electrical Engineering from the University of Pennsylvania and graduated with Honors from the University of Chicago – Booth School of Business.
Today, Mark dives into his first Impact Pricing recorded coaching session in this special podcast episode with guest, Jeremy. You’ll get first-hand information as they share a power-packed conversation about Jeremy’s company, HAAS Alert. Jeremy will tell more on how HAAS Alert operates and generates income, how the three categories of costs affect the economic value of the vehicle, more so, the pricing model of HAAS Alert and know the different approach used on direct selling and indirect selling through channel distribution. Mark, then again, will give his insightful and expert tips and advice that will surely help your business.
Whether you’re a business owner, a student, or somebody interested in pricing, don’t forget to grab your pen and ensure you take down notes as this is one interview you shouldn’t miss!
“Find the market segment where they get the most value out of what you’re offering.”
– Mark Stiving
Topics Covered:
02:05 – Jeremy talks about his company, HAAS Alert and how it prevents a collision on-road vehicles
03:52 – How real-time and automatic feeding of data into the Waze app adds value to HAAS Alert
05:05 – The two-sided marketplace where the company generates revenues: (1) fleet owners and operators, and (2) car co-manufacturers
08:45 – Three categories of costs on roadside accidents:
Minor collisions – requires repair of the vehicle and out of service time
Medium – major damage happens which might need a vehicle replacement
High – may involve personal injury lawsuits
11:02 – Probability that the three categories will occur to determine the economic value to the buyer
13:42 – Detailing the flexible pricing model of HAAS Alert
15:38 – Mark gives his expert opinion on the pricing model of HAAS Alert
19:20 – Discussion on the effects of direct selling vs indirect selling through channel distribution
22:43 – Challenge on bundling hardware to the subscription price and pay the distribution channel
25:40 – Value-based pricing as a healthy approach to attain business sustainability
27:16 – The churn rate at the end of the term
28:34 – How customers save more on paying upfront fees vs annually on a five-year plan
31:39 – Pros and cons of upfront price and upfront buy-in
34:53 – Mark shared a brief story when he kept on increasing his rate as a speaker, and yet people still agree to pay
36:08 – Mark’s thoughts on price segmentation specifically when asked what to do if customers talk
Key Takeaways:
You find the market segment where they get the most value out of what you’re offering, and that’s where you go penetrate first because those are the people who have the biggest pain and they’re more likely to say yes to us. They’re more likely to pay us higher numbers, and we start to build the business that way.”– Mark Stiving
“We want to capture more of the value that our buyers believe is there, that our buyers perceive. That’s always important.” – Mark Stiving
“In the long run, you’d like your distribution channel to be out of getting that subscription revenue. That’s your revenue, not theirs. You need to pay them enough to sell your product, but you don’t need to pay them forever.” – Mark Stiving
Connect with Jeremy Agulnek:
- haasalert.com
- LinkedIn – HAAS Alert
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Find out how subscription-based pricing works for software B2B companies * Discover the metrics and criteria you need to track your SaaS subscription business * Know the pros and cons of feature-based pricing model for SaaS
Ryan Glushkoff founded Fraction8, a consulting firm focused on delivering pricing and product marketing expertise for business to business (B2B) software companies. He worked in the software industry for a massive 20 years and has relevant experience in both pre-sales and post-sales for the mass-market and custom-enterprise type of software companies. These opportunities gave him an advantage in understanding how SaaS (software as a service) companies need to position, price, and market themselves for success. He was a student of Mark who took the first Price class in his Pragmatic Marketing course.
In this episode, Ryan shares the foundations of his career in pricing and his exposure in the B2B software market which paved the way of starting his consulting firm catering to the same market. His insights into the evolution of pricing, risks in changing the pricing structure, and the concept of feature-based pricing model.
Get an in-depth explanation of the pricing metrics of subscriptions – the three essential criteria and the process of identifying the appropriate metrics for customers.
“Talk to your market, whether that be your customers, your prospects, your churn customers or your white space prospects that you’ve never spoken with before in your town. Get out there and talk to them because there is no substitute for hearing from them firsthand.”
– Ryan Glushkoff
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
01:35 – Ryan’s core beliefs in pricing and how his pricing career started
02:15 – Working at Disney where he was first exposed in pricing and where he met his wife
03:01 – His experience in B2B software providers in a marketing capacity and eventually starting his own company
04:07 – Focusing his market on software subscriptions in B2B companies
05:53 – How Disney figure out how to offer their packages to families with the B2C approach
07:20 – Subscription pricing vs. normal pricing
08:36 – Defining the concept of metrics in software subscription
10:07 – Three (3) important criteria of pricing metrics: Alignment with business, easy to understand,and scalability
11:54 – Walking through the process of identifying the right pricing metrics for customers: brainstorming, surveying the market, segmentation, and pricing evaluation
15:59 – Ryan’s thoughts on pricing evolution and his advice on that
19:13 – Why companies need to be cautious when updating their pricing structure
22:43 – The strategy of raising prices with new customers and the risks involved
24:20 – Two (2) important pricing advice to the audience: Get out there and talk to your customers and choose a pricing metric that is not feature-based.
26:23 – Citing an example of a feature-based pricing metric
Key Takeaways:
“One of my core beliefs is that pricing is a blend of art and science together. You got to be good with numbers of course because it is pricing after all, but you have to also be very good at discerning behavioral patterns that you are not easily visible in the market.”– Ryan Glushkoff
“Subscription pricing means that you as the buyer agree to pay a fee in perpetuity or at least until the end of your contract term in exchange for a product or services that are rendered to you. (While) Non-Subscription pricing means that you're obligated to pay only once, or at least according to the payment terms of your contract.”– Ryan Glushkoff
“How the customer pays do not necessarily have to align with the value derived. Although I would submit to you that it works out better economically for the vendor if the pricing is aligned to the value created by the product per surface. And that's the whole value metric side and software subscription.”– Ryan Glushkoff
“You have to be careful with customers though because a paying customer is better than a churned customer even if they aren't as profitable as you'd like them to be.” – Ryan Glushkoff
Resources Mentioned:
Monetizing Innovation: How Smart Companies Design the Product Around the Price
Connect with Ryan Glushkoff:
- fraction8.io
Connect with Mark Stiving
- Email: mark@impactpricing.com
Why you have to check out today’s podcast: * Find out how pricing affects sales * Discover how much customers are willing to pay and where the value comes from * Learn how to develop strong business acumen skills
Mark Boundy is a business builder, sales leader, author, coach, and consultant. He has grown businesses in a variety of industries by his relentless focus on uncovering customer value and delivering high-value results.
Currently, he works as the Advisor to CXOs at the C-Suite Network since 2017, and for eight years now, he is the Sales Performance Consultant of a sales and service performance company called Miller Heiman Group, combining the world’s most successful sales methodologies with his value discipline for his clients. He’s currently writing his book, The Value Multiplier, which will be available soon.
“If you deliver customer value and you know how to price it, everything else will take care of itself.”
– Mark Boundy
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
01:31 – Mark Boundy shares his pricing journey, how he started in pricing
05:31 – Overview of his upcoming book “The Value Multiplier: How Adding Value to Your Customers Multiplies Value Back to Yourself”
06:37 – Mark’s insights about CSO Sales Research
09:50 – Mark Stiving narrates why he thinks salespeople don’t sell value
13:15 – Figuring out what are customers willing to pay and where the value comes from
17:39 – How to make sales training stick, why sales trainers don’t train about the value or if they do, why everybody ignores it
21:55 – Mark Boundy tells his work experience with GE and how he developed the business acumen mindset
23:31 – An impactful pricing advice from Mark Boundy – “Ask the magic questions: What does this mean to you and how much is this costing you every year? Or what financial difference could this make to you if you were to solve this problem? Then, shut up and listen which will tell you where the value comes from.”
24:41 – Parting words from Mark Boundy – “You can cut your way to survival. You can cut your way to profitability, but you can’t shrink your way to growth.”
Key Takeaways:
“The pricing is about not only capturing value but communicating value and creating value.”– Mark Stiving
“Value only exists in the customer’s mind. And if you are messaging value or proposing value in your value proposition, you don’t know if it landed and turned into a value between the customer’s ears. You can’t do either of those two things without two-way communication” – Mark Boundy
“All value is perceived value; otherwise it doesn’t exist.” – Mark Stiving
“Value is the desirability of the outcomes that a customer will get from implementing, buying, installing our product or service. It is the monetarily measurable, usual desirability of the outcome.” – Mark Boundy
“A really simple definition of value is what your buyer is willing to pay.” – Mark Stiving
Connect with Mark Boundy:
- Email: mark@boundyconsulting.com
- Read his blog: boundyconsulting.com/blog
- millerheimangroup.com
- boundyconsulting.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Why you have to check out today’s podcast: * Learn how Ron and his aftermarket service expertise help clients favorably impact the availability, reliability, support resource footprint and capability level of a product or system for an end-user. * Find out why cash flow is a huge challenge in a subscription model and why you need finance people to help you with that * Find out why the price is an emotional driver of B2B and B2C brands
Ron Giuntini is the Principal of Giuntini & Company, Inc. since 1990. He is in charge of overseeing the day to day business operations, managing various consultants, and heading the business development. He also founded G35 Software, Inc. in 2016 where they employ a start-up, cloud-based, subscription-free application software which enables B2B sales teams to Configure & Price a Quote (CPQ) engaged in Aftermarket solutions.
In this episode, Ron shares his expertise about the aftermarket service, gave an in-depth comparison about subscription and product service models, the challenges involved in developing a subscription model for your business and why you need to involve the leaders and decision makers of the company in the modeling and pricing process.
Tune in till the end of this episode and get that one piece of actionable subscription advice that will significantly impact your business.
“You must model your subscription financially to present to your leadership. If you're interested in moving towards that, you have to have the backup of the CFO because of the risks.”
– Ron Giuntini
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
01:12 – Ron defines what aftermarket is all about, what the biggest aftermarket sector is and how massive this industry is
05:29 – Difference between subscription and product as service business models
08:17 – Citing Ron’s reasons why robotics leads the subscription pricing model – protecting the brand and IP
10:56 – Subscription lesson from the Hughes Drill Bit, how it started the subscription model for drill bits
11:39 – The interesting antitrust case of United Shoe Machinery Corp.
13:24 – The reason why robotics leads the ‘product as a service’ model – the original equipment manufacturer (OEM) getting the constant feedback
14:09 – Mark tells value-based pricing as the reason why he thinks robotics leads the ‘product as a service’ model
16:00 – Ron narrates a detailed description of his other company G35
17:07 – Explaining further how the probability analysis in configuring price quotes was done
20:13 – How understanding a customer’s willingness to pay and the manufacturer’s willingness to accept relates in estimating costs
21:41 – Definition of forecasted cost
22:41 – The idea of creating a new company role called “price accounting”
23:01 – Pricing as emotional drivers of B2B and B2C brands
24:07 – Wrapping up with subscription advice from Ron – “You must model it financially to present to your leadership. If you're interested in moving towards that, you have to have the backup of the CFO because of the risks. You must model it. That's my recommendation.”
25:21 – Why cash flow is a huge challenge with subscriptions and why you need finance people to help you with that.
Key Takeaways:
“It could sell separately, the hardware and the service. It's all about protecting your brand and your IP. That's very, very important.” – Ron Giuntini
“What I would love to see pricing people do is completely ignore cost. Come up with a price, hand it to the finance people and say, can we sell it for this and let finance decide if it's profitable or not.” – Mark Stiving
“In the B2B world, we have to understand the way buyers make decisions, and we have to think about that. We can't just rely on the data, which is pretty interesting.” – Mark Stiving
“Never talk about subscriptions without having that model, having developed it and going to the leadership (team). If you don't, they'll throw you out of the room and ask you - When you're an adult, come back.” – Ron Giuntini
“Cost estimation is an art form itself and what always confuses me is that a lot of pricing people don't really look under the ‘comoda’ in regards to what, what makes up that cost.” – Ron Giuntini
Connect with Ron Giuntini:
- Email: ron@g35software.com
- giuntinicompany.com
- g35software.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Where is Impact Pricing heading? What are our goals?
Many questions have been raised to us when we started the company. What is the company doing? How do we run our business? How do we make money? But the question I like the most is about defining our goals.
In today’s podcast, I’ll discuss more of it with the hope that it’ll spark more of your interest in pricing.
“Our vision is to build a company focused on educating other companies about pricing and value.”
– Mark Stiving, Chief Pricing Educator
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
The Value in Value
Starting another new company has always been a challenge. One of the most significant problems I see though in almost every single company is they don't understand value. Salespeople don't know how to sell it. Marketers can't talk about it. Product teams don't build it. It is a huge problem, and that was going to be my main focus. I help companies know what value is and help them create, communicate and capture it through education. I realized I don't want to be a consultant. I want to be an educator.
The Power of Subscriptions
Subscription pricing is the hype for years now. It is amazingly different and powerful. There are several excellent sources of information about managing subscription businesses, and they all seem to be on the leading edge. I fathomed nobody's teaching the basics and so, I decided to focus on pricing.
Choosing between Value or Subscriptions spells dilemma
Choosing between these two this seems like a significant problem to most people who are into pricing.
- 1st dilemma: Do I focus on subscriptions or value or both?
When coaching clients, I always tell them the focus is key. You have to pick. Eventually, I chose subscriptions. I'm hoping in six months I can start shifting back toward value and you'll hear more about later.
- 2nd dilemma: Should I be a small Solopreneur or Should I build a company to do what I want to do?
I have to build a company. There's so much pricing knowledge to share and impact. Pricing is destined to be more than my personal brand. Currently, we have six part-time people and me to work on marketing and content. I'm the only full-time employee, but the team is amazing and growing. We’re unbelievably positive with our cash flows already.
Our Products
We currently sell two products, but we don't actively market them.
- Mentoring
I often get calls from companies who want me to do consulting for them, but I don't want to be a consultant. Instead, I offer the buyer a mentoring program and these consist of weekly phone calls with me to talk about their pricing issues. They do the work. I spoke with them about it. It works out well for both of us because my mentoring program costs a whole lot less than a consultant would and they learn along the way. I get to keep my fingers involved in real problems and test new ways of explaining things one person at a time.
- Custom Content
Twice in our companies have called and asked for webinars on specific topics. One was pricing metrics, and the other was the psychological aspects of pricing. Our first real product is set to launch in May. It is our course on subscription pricing.
The webinar has various topics, and one of them is the comparison between subscriptions and traditional business.
Here is a rundown of the differences between these two types:
-
Both are the source of revenue and revenue growth. Traditional companies rely almost exclusively on winning new customers. Subscriptions do the same, but they also focused on retaining the current customers and expanding or growing the revenue they get from existing customers. These required new metrics, new thinking, and new pricing methodologies.
-
The pricing lever companies use in the subscription are a little bit different than they are in traditional. Both traditional and subscription businesses are much better off when they define their market segments, so that's a common lever between the two packaging. Best packaging is a standard lever, but traditional businesses usually define a set of products and rarely change them. Subscription businesses use packages, frequently change them and often based on usage data.
- Subscriptions use pricing metric while traditional companies don’t. It is objectively a critical topic to know what businesses charge.
I had a shocking request from a very well respected B2B (business to business) subscription-based company from Silicon Valley and asked me if I could teach them the pricing metrics. It was an unexpected question since I assume, they already knew this. I suppose they knew way more about this topic than I did since they live it.
“All companies set prices, yet very few know what they're doing when they're setting their prices. Why wouldn't that be the case with subscription pricing as well?”
- Mark Stiving
We said yes to the opportunity, and that's part of the subscription pricing course. It is one piece of evidence that gives me massive hope that there's going to be a fantastic demand for this course.
Our Subscription Pricing Course
In our model, our very first class consisted of four 90-minute modules, jam-packed with information about subscription businesses. The two-day class has lots of exercises so, the students will know the topic more in-depth. The course is instructor-led. It will either be in person or online, so we hit a lot of interaction and feedback from our students.
The future of Impact Pricing
Our vision is to build a company focused on educating other companies about pricing and value. We're currently looking at a few video training platforms and will likely offer a course on how costs related to pricing for free. We're going to provide that one for free as a way to gain experience on the platform and to get feedback on that type of training from our clients. We will add the topics of creating, communicating, and capturing value as soon as we possibly can. Since we're about to launch the first product and hoping that with all signs, it's going to do exceptionally well. We've started to think about how to scale this as a business and, you’ll hear from us on that soon. But for now, we don’t need an answer immediately.
Connect with Mark Stiving
- Email:mark@impactpricing.com
Why you have to check out today’s podcast:
- What is a subscription pricing model?
- How cost is managed in software and hardware companies using the subscription business pricing
- How pricing model affects your value proposition
Jason Carley is one of the world’s leading pricing advisors. He is a Senior Director in Simon-Kucher’s Sydney Office, a firm that helps clients grow their revenues and profits faster, better and more sustainably than anyone else. He has over 10 years of experience with Simon-Kucher, working out of the London and Boston offices before the establishment of the Sydney office.
In this episode, we will hear Jason share his pricing and subscription expertise in growing client’s revenue and profits exponentially. Jason’s work focuses on developing go-to-market strategies, optimizing portfolio design and pricing, and implementing value-based pricing.
“…we’ve got to move away from thinking that customer first means customer knows best. We know our products better than our customers do.”
– Jason Carley
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
01:37 – How Jason started in Pricing
03:30 – Talking about the subscription business model
09:24 – How cost is managed in software and hardware companies using the subscription business pricing
10:51 – Subscription companies' challenges Overcoming the challenges of subscriptions in companies
12:36 – Customer research and the real usage data - how are they affect the subscription pricing model
14:01 – Determining what subscription pricing should be through different pricing metrics
15:43 – Why user-based metric as ‘not’ the best metric for a pricing model
18:17 – The challenges of growing a business: evolving from a start-up to a more complex pricing method
19:58 – Confused buyers don't buy: Jason's thoughts on this statement
20:53 – Factors for consulting engagement success, what does a consulting engagement looks like at the start
22:52 – His valuable advice to companies thinking about going subscription: Understand what adds value from your offering to your potential customer
Key Takeaways:
“I think the number one thing I would say is really understand what adds value from your offering to your potential customers.” – Jason Carley
“I think there's kind of a difference in what creates value with a one-off point of sale versus delivering incremental value over time.” – Jason Carley
Connect with Jason Carley:
- Email: jason.carley@simon-kucher.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Hey Pricing Practitioners, have the chance to get Impact Pricing: Your Blueprint for Driving Profits
Just Answer the Question: What is the most interesting recent example of price communication or value communication that you’ve seen?
(Post your answer at Mark’s LinkedIn designated Post)
Why you have to check out today’s podcast:
- How to reach for your dream however hard it may be
- The tips and tricks of running a subscription business
- Revenue buckets you have to focus on to keep a steady stream of clients/customers
Darren LaCroix is a world champion public speaker in 2001 at Toastmaster’s International. Since that victory, Darren has traveled the world demystifying the process of creating a powerful speech and teaching it to people through his speaker training program. Several years ago, he completely changed his business model from selling physical coaching products to a subscription-based model.
Don’t miss a chance to listen to this episode and hear Darren talks about his journey from being a stand-up comedian wannabe, a champion public speaker to owning a high-ticket subscription-based speaker training business.
Topics Covered:
02:34 - What's behind Darren's public speaking's story and his purpose why he wanted to teach other’s the craft
11:27 - A backstory of his business before venturing into a subscription business
16:50 - Taking about his higher-end products before he going into a subscription business model
19:19 - Value giving, nurturing, and improved retention: reasons why customers stay subscribed and keep paying
20:38 - What is customer acquisition cost?
23:46 - How does he manage his subscription business and make things work
24:19 - Mark taking about viability metric= a measure of profitability
26:01 - Expansion ideas to keep clients coming in, talking about cross-selling and upselling
29:03 - Darren asking a question to Mark: Should I increase my subscription rate and how much, if I should?
33:17 - One good advice from Darren: "I would tell anyone about reaching any goal or dream is to find the people who have been there and done that."
Key Takeaways:
“I never thought pricing could be exciting and fun, but man, when it impacts your bottom line, you make it fun.“ - Darren Lacroix
“... when you buy into a success system, actually follow it.” - Darren LaCroix
“Be a sponge. Go to the people who have been there and done that and ask them for advice because they think differently than the average person.” - Darren LaCroix
“You have to have your area of expertise. ...you need to understand how you help them solve problems. When you're the one on the stage, you don't have to network your butt off and hand out business cards and do follow-ups. You're the expert. You're onstage now. It's what you do with that privilege of the platform that gets people to come to you.” - Darren LaCroix
Resources:
- Laugh and Get Rich: How to Profit From Humor In Any Business by Darren Lacroix
Connect with Darren LaCroix
- www.darrenlacroix.com
-
Twitter
-
YouTube
Connect with Mark Stiving
- Email:mark@impactpricing.com
Why you have to check out today’s podcast: * Advantages of subscription pricing: why brands like Amazon and Uber chase the subscription model * Get an expert’s analysis on the subscription model of several companies * How the subscription business model impacts the growth of a company's revenue growth
Mark S A Smith is an author, podcaster and a business growth strategist. He helps companies grow their business as fast as possible by teaching them how to sell their services at a higher margin through disruption marketing. He designs and implements leadership, sales, marketing, customer acquisition and client conversion systems that find and recruit willing buyers for products and services ranging from common every-day to high-end unique and disruptive.
In this episode, Mark deeps dive into the ins and outs of subscription pricing. He’ll share his insights on why for him subscription pricing is both wonderful and awful. Also, he gives a thorough explanation of how the subscription model is a driving force in generating revenues.
Topics Covered:
02:34 – Reasons why subscription is wonderful according to Mark: it is easier to sell and customers prefer the stability they get from a subscription model
07:11 – Hitting its prime: Amazon’s subscription model, how this type of subscription model generates revenues
11:34 – Discussion around the 'bad aspects' of subscriptions
15:14 – The difference between a leasing agreement and ‘true’ subscription
17:46 – Uber’s subscription model: Is it a subscription or a by-demand model
21:04 – Mark’s valuable pricing advice: “Never ask your customers what you should charge them.”
Key Takeaways:
“If you're the CEO of the company, your job is to maximize shareholder value. So, every executive on the planet is looking for a way to pivot to subscription models if they expect to keep their job over the next 36 months.” - Mark S A Smith
“Our job as a sales professional is to match the needs of the customer. And a lot of times we have to help them figure out what those needs are and make us their safest choice, not the best choice. And a subscription model substantially improves the probability that they'll see us as safer versus a transaction-only purchase.” - Mark S A Smith
“In the world of negotiation, keep in mind lowering the price to get a deal is not negotiation. It's stupidity.” - Mark S A Smith
Resources:
- Impact Pricing: Your Blueprint for Driving Profits
- Guerrilla Negotiating: Unconventional Weapons and Tactics to Get What You Want
Connect with Mark S A Smith:
- sellingdisruptionshow.com
- bijaco.com
- Email: mark.smith@bijaco.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Hey Pricing Practitioners, have the chance to get Impact Pricing: Your Blueprint for Driving Profits
Just Answer the Question: Why do customers always push back on price?
(Post your answer at Mark’s LinkedIn designated Post)
Why you have to check out today’s podcast: * Discover the importance of pricing strategy for subscription products * Learn about pricing and its effects on consumer behavior * How to approach the stages of SaaS customer acquisition, in your customer acquisition, retention, and expansion
Natalie Louie is the Director of Product Marketing at Hired a subscription-based business. Her experiences and specialties focus on improving operations, revenue, profits, integrations, partnerships, managing, SaaS pricing and packaging, product marketing, planning, and development.
In this episode, Natalie shares her pricing expertise, how the right subscription model makes your life easier and how scaling the pricing metric benefits her growing customer.
“The beauty of subscription is you don’t have to own or build anything yourself, but you have the ability to get what you want on demand.”
- Natalie Louie
Stay updated on all thing pricing.
Subscribe to ‘The Pricing Perspective’ here
Topics Covered:
01:32 - Natalie’s SaaS pricing backstory, how it became her expertise
04:00 - Price-Quality Relationship: its effects on consumer behavior
05:19 - How she sees the beauty and uniqueness of subscription
06:30 - Mark’s insight on product owning versus subscribing for functionality
08:11 - The benefits of subscription on the sell side in terms of predictable revenue and what customers value
10:30 - What Hired, Inc. does and what it’s all about
12:05 - Between employer and employee who subscribes to Hired model
13:30 - Natalie’s definition of pricing, seeing it as a metric that scales
15:38 - Her common strategies of scaling the price and its effect on the customers
18:30 - The importance of the 3 Revenue Buckets to grow your business
20:55 - The story behind her title, being Hired, Inc’s Director of Product Marketing
23:15 - Different levers to use to improve the process of product and pricing to grow more customer
26:40 - The pricing treatment you can apply to your current and new customers
28:16 - Natalie’s valuable advice on how to have a pricing impact
Key Takeaways:
“I am not saying everything in your life should be replaced by subscription but if you replace things in your life you see as chores with subscriptions, it makes it easier.”- Natalie Louie
“On the sell side, any business offering a subscription, the benefit is the consistent, predictable revenue that your company will get from your customer base year after year and that what’s people value.” - Natalie Louie
“There is a different metric that speaks to a different user.” - Natalie Louie
“Pricing has its own roadmap. It’s constantly being refined and we’re always evolving it.” - Natalie Louie
Resources:
Impact Pricing: Your Blueprint for Driving Profits
Connect with Natalie Louie
- Hired Inc
Connect with Mark Stiving
- Email:mark@impactpricing.com
Hey Pricing Practitioners, have the chance to get Impact Pricing: Your Blueprint for Driving Profits
Just Answer the Question: What is the most interesting recent example of price communication or value communication that you’ve seen?
(Post your answer at Mark’s LinkedIn designated Post)
Why you have to check out today’s podcast: * Discover how ProfitWell gathers information and subscription analytics to help businesses uncover and analyze the revenue growth * Learn how Van Westendorp pricing model work * Discover how to use the value matrix to optimize your product pricing
Peter Zotto is the General Manager of ProfitWell, a business intelligence solutions company which aims to improve retention and monetization automatically through unmatched subscription intelligence. He is one of the stars of the hit show, Pricing Page Teardown. He’s also a huge NBA junkie and he used to play at University of New Hampshire (UNH) in Durham, New Hampshire.
In today’s episode, Peter talks about an interesting relationship between value and willingness to pay and how these data help their pricing strategies with subscription companies. He also shares how he helps companies reduce churn, optimize pricing, and grow their subscription business end-to-end.
“Value is the intersection between willingness to pay and how much you value a particular product or service.”
- Peter Zotto
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
02:07 – Mark talks about Price Intelligently's tearing down the pricing review of FarmersOnly.com and Match.com
03:51 – Peter shares how ProfitWell's helps companies reduce churn, optimize pricing, and grow their subscription business end-to-end
07:01 – How ProfitWell collects data as seen on their shows
10:40 – The reason why it’s not helpful to ask for somebody’s willing to pay
11:37 – Using Van Westendorp Price Sensitivity Meter’s in identifying consumer price preferences and its limitations
16:47 – How value matrix works, and how to win on the value proposition and not just price
22:01 – Announcement of Winner for Ep6 question: What is value?
24:07 –The perception of value and willingness to pay: how customers perceive a price is as important as the price itself
Key Takeaways:
“It's not really helpful for me or for any of the listeners out there for you to say, 'Hey, when you want to identify pricing, just ask your market or your customers how much they're willing to pay.' Because they're going to give you numbers that are all over the place. And at the end of the day, they're all correct in the way that they think.” – Peter Zotto
“I think if we were thinking about value, it's really what are you willing to pay.” –Mark Stiving
Resources Mentioned:
- Impact Pricing: Your Blueprint for Driving Profits
- Van Westendorp Price Sensitivity Meter
Connect with Peter Zotto:
- profitwell.com
- Email: peter@priceintelligently.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Why you have to check out today’s podcast: * Understand what subscription-based pricing is all about * Discover how having a systematic pricing metric and model help justify the value * How usage is connected to value and how to monetize those date to have a new source of value in subscription payments
Jim Geisman is founder and president of Software Pricing Partners. His firm is primarily focused on pricing strategies, processes, and tactics. Engagements also focus on the financial impact on the client company and the impact on the sales, marketing and development functions.
In this episode, Jim tackles what subscription pricing is all about, the structured process of product and service packaging to fully address customer segments and needs, and the correlation of usage to value when it comes to subscription pricing.
“You have to be extremely careful not in what you charge but how you present the options to the customer.”
- Jim Geisman
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:57 – Jim's backstory, getting an MBA in Harvard
03:09 – How Jim started in his pricing journey
05:45 – The pricing metric to be considered in a subscription model
09:45 – Jim dig deeper into Salesforce’s subscription pricing model
15:25 – Correlation of usage to value, why subscription services are considered key to monetize customer relationships
17:45 – How usage is a metric in vertical markets
20:20 –Jim’s advice on how to create a pricing impact
Key Takeaways:
“The metric that makes the most sense is the customer.”- Jim Geisman
“Think about the way they make in purchasing decisions and incorporate some of their own personal buyer skepticism and objections.” - Jim Geisman
Resources:
- Impact Pricing: Your Blueprint for Driving Profits
Connect with Jim Geisman:
- Email: jgeisman@gmail.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Hey Pricing Practitioners, have the chance to get Impact Pricing: Your Blueprint for Driving Profits
Just Answer the Question: What is the most unique pricing model you’ve ever seen?
(Post your answer at Mark's LinkedIn designated Post)
Why you have to check out today’s podcast: * Understand pricing in procurement * How to lower procurement time in half, and cut costs like a pro * How to price your product: what you need to know before you launch
Maree McMinn, known as the Pricing Rebel, is a pricing practitioner for about 12 years. Currently, she’s the Indirect Procurement Manager of Valvoline.
Maree has experience across a wide variety of industries including consumer packaged goods, retail, distribution, manufacturing, and software. She's built several disciplines from the ground up including, pricing, competitive intelligence, business intelligence, supplier diversity, and indirect procurement.
In this episode, Maree shares her pricing experience, how this helps her the procurement process and how it benefits her to make the best pricing decisions.
“You have to understand what people's reference prices are. Quite frankly, do nothing as your competitor.”
- Maree McMinn
Stay updated on all thing pricing. Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:35 - Maree tells #pricingrebel's backstory, what it is all about and how it began
02:26 - She shares how her pricing career started
04:36 - Her transition to procurement side
07:02- Mark perspective regarding value vs. pricing in terms of procurement
10:05 - The good side of procurement besides price negotiation
13:00 - The success story behind Maree’s pricing career
12:25 - Her experience implementing new or pricing business model
18:29 - Maree’s thought on the biggest problem of a company in terms of pricing
20:46 - Her piece of advice to companies to have an impact
Key Takeaways:
“We get to a better solution because I bring them innovation, not just the price.”- Maree McMinn
“Thinking about SKU rationalization. Trying to shoehorn what they did before and into a new solution, your breaking it apart and helping the organization think through.” - Maree McMinn
“One of the things company is doing very poorly is think about price before they think about the product.” - Maree McMinn
Resources:
- Impact Pricing: Your Blueprint for Driving Profits
Connect with Maree McMinn:
- msquaredww.com
- Email: maree@msquaredww.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Hey Pricing Practitioners, have the chance to get Impact Pricing: Your Blueprint for Driving Profits
Just Answer the Question: What is Value?
(Post your answer at Mark's LinkedIn designated Post)
Why you have to check out today’s podcast: * Pricing strategies should align with how your business competes and wins * Understand how customers behave, not just what they say * Discover more about Pricing Model Concepts and Subscription Pricing Model and how these work
Scott Francis formed SPS in 2005 after an extensive career improving profitability in the senior leadership of corporate finance and marketing entities, including CFO and SVP Marketing & Pricing.
Find out in this episode how Scott Francis helps clients improve profitability with behavioral economics and data-driven pricing.
“Make sure you're paying attention to how customers actually behave as opposed to what they say they're going to do.”
- Scott Francis
Stay updated on all thing pricing. Subscribe to 'The Pricing Perspective' here
Topics Covered:
00:43 – Introduction about Scott Francis’ career background and his transition from VP-Finance to VP-Marketing
02:31 – Where should the pricing function reside in your business?
04:33 – Explaining the roles of Finance, Sales and Marketing departments in value pricing
07:53 – Problems with clients about value pricing about geography, average sales price and price elasticity and its solution
14:44 – Key Performance Indicators and the pricing model concepts and how these work
19:32 – Hear Scott Francis’ most valuable pricing advice
Key Takeaways:
“Make sure you're paying attention to how customers behave as opposed to what they say they're going to do.” - Scott Francis
“If you pay attention to how customers actually behave when pricing choices are in front of them, you'll have a much better understanding about how much pricing power you really have and how sensitive your customers really are, and you can make much better decisions than just listening to what the customers say via survey or what the salespeople tell you.” - Scott Francis
Connect with Scott Francis:
- Email: sfrancis@stratpricing.com
- Website
Connect with Mark Stiving
- markstiving.com
Why you have to check out today’s podcast: * Discover the importance of knowing how the marketplace perceives your price and value * Learn why pricing is considered both as an art and a science * Know why interviewing the key decision-makers and influencers is essential in the pricing process
Summary
Michael Hurwich is the global president of SPMG, a pricing strategy, and consulting services. He has consulted to major Fortune 500 and mid-sized firms for the past 15 years. He is one of the foremost pricing consultants known around the globe for his hands-on, pragmatic approach integrating Value-Based Pricing practices within an organization to Strategy development and tactical pricing. He started his consulting career at Braxton Associates, the strategic arm of Deloitte & Touche Consulting Group.
In this episode, Michael talked about the exciting science and art of pricing, the pricing process hierarchy, and the factors that are involved in the pricing process. Also, he discussed the importance of knowing how the price is communicated and perceived in the marketplace and how customers view an estimate is as critical as the price itself. Check out this episode and be guided in doing value-based pricing.
"It is important to think about how your price is communicated in the market and how your customer perceives it." - Michael Hurwich
Stay updated on all thing pricing. Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:51 – All about his book The Joy of Pricing, the backstory on how he got into the industry of pricing
04:15 – Pricing as both an art and a science
04:51 – Common methods to price products and services: cost-based pricing and value-based pricing, their differences
05:30 – Why value-based pricing is challenging, the element that is involved in solving the complexities of pricing
07:28 – The organizational considerations when it comes to pricing
12:31 – Determining pricing process hierarchy, why interviewing the key decision-makers and influencers is essential in the pricing process
20:31 – Michael’s one value advice: Think about how your price is communicated in the market and how the customers perceive it.
Key Takeaways:
“Pricing is really powerful in the impact that we could have for our clients.” – Mark Stiving
“The price that you set in the market establishes you of how you wish the customers to perceive you regarding how you deliver value as well as the price in the marketplace.” – Michael Hurwich
“Do you understand how the audience is perceiving your price value proposition in the marketplace relative to other competitors?” – Michael Hurwich
Resources:
The Joy of Pricing: A Managers Guide to Value-Based Pricing
Connect with Michael Hurwich:
-
spmgglobal.com
-
LinkedIn
- mhurwich@spmgglobal.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Why you have to check out today’s podcast: * Discover the secrets of customer value * Learn what to say when a customer says your service is expensive * Find out how to deal with pricing pressure
Summary
Mike Wilkinson is the Value Selling Expert. He works worldwide with clients across a diverse range of industries and business sectors focusing on value and value selling. He has worked in a wide range of senior sales positions and has experience of fast-moving consumer goods as well as business-to-business sales.
In this episode, Mike shares how he helps people find new ways of understanding and communicating value so money is not left on the table and how they can be rewarded for the value they deliver.
"Value is a mystery. Our job as salespeople and as businesses is to solve the value mystery. And the mystery is how our customers define value." - Mike Wilkinson
Stay updated on all thing pricing. Subscribe to 'The Pricing Perspective' here
Announcement:
If you want to address the Seven Challenges of Value to take you from an understanding value at the beginning of delivering value to the end. Get a 20% discount to The Value Challenge System
Register here: http://bit.ly/TheValueChallengeSystem
Coupon: Impact
Topics Covered:
01:35 – Mike explains price management is two distinct things. One is the price setting bit, and the other is the price getting bit
04:15 - What is value? Value draws mystery.
09:19 - How do we identify and tackle the challenges that we face in selling our value effectively
09:53 - Seven challenges of value
10:08 - The value triad. Component element of value: value gain, cost reduction, and emotional contribution
14:34 – How to deal with pricing pressure
15:10 - What to say when a client tells you're too expensive
18:22 – Deliver your promise
20:31 – Mike’s one value advice: Your customer defines value not you. And because it’s true, you have to solve the value mystery.
Key Takeaways:
“Value is what a customer willing to pay.” – Mike Wilkinson
“If you have a sales team who cannot sell on the basis of value then the challenge of actually getting the price is that you have set becomes a much bigger challenge.” – Mike Wilkinson
“The value thing comes in when you really understand and appreciate the value that you are delivering to that customer.” – Mike Wilkinson
Resources:
- Value-Based Pricing: Drive Sales and Boost Your Bottom Line by Creating, Communicating and Capturing Customer Value
- The Challenge of Value
Connect with Mike Wilkinson:
- mw@axiavalue.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Why you have to check out today’s podcast: * Learn what a customer willing to pay * Learn why it is much better not to do hourly billing * How can you move beyond the fundamentals to “pricing segmentation
Summary
Mark Stiving, our host has a Ph.D. in Pricing from UC Berkeley. For over 25 years he has studied, helped and led businesses through the lens of pricing, a radically different approach from other business experts.
In this episode, Mark shares the backstory how he started into the pricing career, the decision-making process of a customer right before they buy a product and the process how he helps companies discover how buyers perceive value and how to price their offerings to capture more of the value they create to grow their business and their profits.
“People are not price sensitive when they’re making the “Will I” decision and people are very price sensitive when they are making “Which One” decision.”
– Mark Stiving
Stay updated on all thing pricing.
Subscribe to the 'Impact Pricing Perspective' here
Topics Covered:
01:10 – Mark talks about his journey how he started into pricing
02:36 – How he takes so much courage to leave Pragmatic Marketing and build his own business
10:19 – Mark’s thoughts regarding the value-based pricing concern of companies
12:30 – Explanation about segmentation between the individual and general outcome in pricing
15:50 – How he helps people perceive value and how to price their offerings
24:00 – Mark’s explains the concept of ‘Which One and Will I’: Understanding the decision customer is making right before he buys your product
Key Takeaways:
-
“Whenever somebody asks me how I will go up and pricing this, I stepped back and asked, What decision are they making? I think people could adopt that attitude it would have a huge impact on how much they could achieve.” – Mark Stiving
-
“Buyers don’t understand our products or the outcome they can achieve with our products and what’s funny is we don’t understand our buyers. If we don’t have one of those value conversations, there is no way that we could pick either side to understand the value.” – Mark Stiving
Resources
Impact Pricing: Your Blueprint for Driving Profits
Connect with Mark Stiving
- Email:mark@impactpricing.com
Connect with Kirk Bowman:
artofvalue.com
Why you have to check out today’s podcast: * Learn how Kirk learned about the concept of value pricing * Identify the two categories in measuring results * Find out details about Kirk’s pricing consultancy company and his podcast
Summary
Kirk Bowman is the founder and Visionary of Value and the Art of Value, a pricing consultancy in Dallas, TX. His podcast, the Art of Value Show, is one of the most shows for knowledge professionals. He has spoken at numeration conferences on pricing including QuickBooks Connect and Scaling New Heights. In 2011, he was appointed a Practicing Fellow at the VeraSage Institute, the think tank founded by Ron Baker. His software company, MightyData, was featured in the book Implementing Value Pricing.
In this episode, Kirk tells about value pricing, how he was introduced to it and later switched to this method in estimating and billing customers. Be inspired as he shares how this decision increased his revenue over 50% on the first year and 70% on the second. Learn this and more in his journey on value pricing.
"The next time the customer asks for a lower price, turn around and ask them what value they are willing to do without in order to get that price." - Kirk Bowman
Stay updated on all thing pricing.
Subscribe to 'The Pricing Perspective' here
Topics Covered:
01:36 – Kirk discovers value pricing and how his revenue went up to 70% in his second year after shifting from hourly billing
03:40 – The concept of value pricing and how it aligns the interests of the professional with his customer
07:13 – Two categories in measuring results or outcomes and how they differ
12:11 – Sharing the profile of his pricing consultancy company - Art of Value and how it is helping professionals with their business models
14:32 – His podcast – Art of Value and the reason he loves doing it
19:37 – His pricing advice that has a significant impact
Key Takeaways:
“Our goals as suppliers are not aligned with the goals of our customers.” – Kirk Bowman
“The customer's interests are the most important thing. When you align with that, you're lining things up for success.” – Kirk Bowman
“It's so important to put alignment up front as one of the things that you're striving for and keep your eye on at all times because it is in our human nature to focus on our own self -interest and so the focus on theirs, it requires intentionality. It requires strong character.” – Kirk Bowman
“Value and pricing are subjective, and by the way, that's okay.” - Kirk Bowman
Connect with Kirk Bowman:
- artofvalue.com
Connect with Mark Stiving
- Email:mark@impactpricing.com
Welcome to Impact Pricing. The podcast where we discuss pricing, value, and the intricate relationships between them.
I'm Mark Stiving and I'll be the host. I love pricing. I love that it's quantitative. Eventually, it has to become a number. You can measure it. I also love that it's qualitative. The goal is to figure out how much people value your offer which of course is impossible to do. It's a continuous puzzle.
I love that most companies don't understand pricing so there's huge value in having these conversations and helping them. There is so much to absolutely adore about pricing. And this podcast is all about pricing, which of course is all about value. As you listen you'll be eavesdropping on me learning from other professionals in pricing, sales, and business. You'll hear my thoughts as a pricing expert applied to the current topics. Best of all you will walk away with tips and tricks on how to improve your business just by focusing on the price.
Pricing is such an amazing topic. It's complex quantitative and psychological. It's huge, powerful, and emotional. Most of all though pricing is fun. Please join me on this hopefully amazing journey through the world of pricing.
Connect with Mark Stiving