If you’re reading this blog, you probably know the dramatic profit impact of small price improvements. (For a company running at 10% net margin, a 1% price improvement increases profit by 10%.) Yet even when companies want to improve pricing performance, they often feel like they are at the mercy of the market. If you’re [...]
If you haven’t already, check out Gerhard Gschwandtner interviewing Ron Hubsher from the Sales Optimization Group on the sales negotiation process. Ron looks at the sales process with the same philosophy I do– namely, selling value instead of price, and using that profit increase to build a much more valuable company. However, he approaches the [...]
I’m a big fan of analytics. And sports (although I no longer have time to keep up with them). So I’ve always been puzzled that with so much money and pride on the line, teams have done so little analyze data to help them win. Sounds a bit like pricing, right? There’s no shortage of [...]
Who doesn’t love a bargain? We all do, and we know our customers do, too. But that doesn’t mean price is the only thing that’s important. It becomes the only thing that’s important if everything else is the same. Many companies feel they don’t have good differentiation, so they have to compete on price. When [...]
I get this question a lot. Sometimes from people who want to think it’s some kind of magic that doesn’t require rigorous analytical thinking, usually from people who want to prove that it’s a science. Often their desire for proof is more than philosophical. If we are suggesting major price moves that will have real [...]
Chris Anderson of Wired said that Free is the price of the future. Some of us beg to differ. Among those with other opinions are Lincoln Murphy of 16 Ventures who published a paper called The Reality of Freemium in SaaS, and Dave McClure, who wrote Subscriptions are the new Black on his always entertaining [...]
The economy’s in a bubble! A crash! A recovery? Careful, you might get whiplash. Looking back at the roller coaster ride, a lot of companies lost a lot of money because they could not act, or even react, quickly enough. Strangely, this money rarely showed up as a line item on the corporate P&L, although [...]
What’s your plan to close out 2009? For many companies, 2009 has been a tough year. While many people remember the crash of the dot-com bubble, some people seem to have forgotten, and even that crash didn’t impact the broader economy the way the housing and credit market implosion did. So how are you going [...]
I wrote a couple weeks ago about Value, Scarcity and Pricing in the Age of Superabundance. Now there’s a timely report about the concentration of profits among cell phone makers from Bernstein Research analyst Toni Sacconaghi. Sacconaghi estimated that while Apple only accounts for 8% of the revenue among handset makers, it gobbles up an [...]
For most people, throughout most of human existence, scarcity was paramount.** Now we live in an age of not just abundance, but superabundance. The agricultural revolution created abundance– not by today’s standards– in food. The industrial revolution created abundance in manufactured goods. The information revolution not only created an abundance of communication and information, it [...]
