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Pricing to attract & keep the best customers is what can make a good business more profitable. Wrong pricing practices, even with good products and services can kill it. It takes three basic things to do it right and not leave money on the table or drive customers away.
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© Business Success Center, Austin, TX 2011
With Jan Triplett, Ph.D. CEO, Business Success Center
© 2011 Austin, TX
Best Practices in Pricing
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© Business Success Center, Austin, TX 2011
Your Passion, BSC’s Expertise
• Our Mission: to help you find your way• Providing guided growth to achieve success since 1982• Sales, marketing, & financial management focus • Clients from A-Z industries, high tech to no tech, products & services
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© Business Success Center, Austin, TX 2011
Your Company Focus?
B to B?B to C?
Better to be P to P
.)(. (Belly Button to Belly Button)
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© Business Success Center, Austin, TX 2011
Who’s your customer now?Who’s your prospect now?
Platinum Gold Silver
Bronze Lead Concrete/Radio Active Waste
Platinum & Gold — create stabilitySilver — has potentialBronze — uncertainLead — a time wasterConcrete — a business killer & never satisfiedRadio Active Waste a long-lasting reputation & confidence destroyer
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© Business Success Center, Austin, TX 2011
Platinum customers are…
• VisionariesSee problem as you doSee value of your solution
• AdventurousConfident in youTrust you
• DecisiveHassle-free or less hassle
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© Business Success Center, Austin, TX 2011
What’s Your Desired Pricing Goal?
Attract paying customers who are:• Most Lucrative• Easiest Sale
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© Business Success Center, Austin, TX 2011
A “Fair” Price
Customers want: To get good value, pay a fair price.
Sellers want: To give good value, get a fair price.
Dilemma: What’s fair to one; may not be fair to the other.
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© Business Success Center, Austin, TX 2011
What Do You Want Customers To Do?
Examples:• Try it• Stock up• Repeat buy• What else?
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© Business Success Center, Austin, TX 2011
Pricing Considerations
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Pricing is an emotional issue for you, your employees, & customers.
Buyer reaction to price is unpredictable.
Shoot from the hip & you’ll end up shot in the foot or worse.
One price strategy usually doesn’t fit all products/services.
Controlling costs can make a business more profitable than raising the price.
Stay alert: pricing laws & regulations change.
© Business Success Center, Austin, TX 2011
What You Need to Know about Pricing
Pricing should be… Pricing will…
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An attention getter and qualifier.
A way to position your company.
Perceived by your Platinum-preferred client as a benefit not just a feature.
Make you rich or at least comfortable or just sick and tired.
Affect the success of all areas of the business.
Require that you don’t just set it & forget it.
© Business Success Center, Austin, TX 2011
Your Price is NOT Right for EveryoneIt’s all about:1. Getting the right customer2. Keeping the right customer3. Considering their perceived risk4. Knowing your true total costs5. Identifying the top value you bring6. Accounting for long & short term goals
THEN Pricing Right & legally!
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© Business Success Center, Austin, TX 2011
The Big Debate
CostVsValue
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© Business Success Center, Austin, TX 2011
Best Practices in Pricing
• Price what you’re worth.• Use KISS pricing system.• Account for profit, contingency & hassle-factor.• Price for positioning.• Monitor & adjust.
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© Business Success Center, Austin, TX 2011
Worst Practices in Pricing
• Undervaluing your benefits.• Under-estimating costs.• Not considering your Platinum customer’s “Flinch Point”.• Blindly following competition.• Inconsistent pricing.• Violating laws - DTPA
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© Business Success Center, Austin, TX 2011
Good & Bad Pricing Examples
1.Charging $15 per hr for professional services2. Providing a $400 discount on a product3. Charging $500 for one research report4. Charging low price to get started5.Your examples?
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Here’s to your
success!Jan Triplett
[email protected]@JanTriple
ttFacebook@JanTri
plett
Business Success Center
Sales & Financial Management Services
January 15, 2011
© Business Success Center, Austin, TX 2011