Impact Pricing

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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] 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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] / [email protected] LinkedIn: https://www.linkedin.com/in/finnhelmohansen Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected]

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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]

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 [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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, [email protected]. Now, go make an impact. Connect with Mark Stiving: Email: [email protected] 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: [email protected] LinkedIn: https://www.linkedin.com/in/brooks-hamilton-austin/ Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]