pricing strategy

Do Pricing First, Not Last

Creative people love making things– widgets, software, knowledge, service calls.  A lot of businesses and product lines get started this way.  Someone has a cool idea to make something.  Skeptics shoot down the idea.  The founder or engineer makes it. … Read More

How did Netflix raise their prices 60%

Twitter is abuzz with the anguished cries of Netflix customers, many of whom will soon be paying $16 per month instead of $10 per month for movie rentals. Many others have angrily threatened to cancel their subscriptions. Instead of focusing … Read More

If you think you’re worth it, but can’t say it…

A lot of businesses think they have a great product or service.  Something above and beyond what the competition offers.  But when it comes time to put a price on all this awesomeness, they are still cheaper than the competition. … Read More

Price Optimization 101

I get a lot of questions about price optimization, so I just wanted to make it really simple. Write down your costs.  Of course, you won’t know your real costs, so just use estimates, preferably from 2-5 years ago.  These … Read More

Value-based Pricing: When can I stop asking questions?

How do you know when to stop asking questions about value? Couldn’t this go forever, asking “Why? Why? Why?” until we end up in a philosophical discussion? You want to ask questions until you no longer get meaningfully different answers. … Read More

Better, Not Cheaper: Red Velvet Events

In a previous post, called Be Better, Not Cheaper , I talked about how important it is to differentiate elements of your offering other than just your price. Here’s a great example of executing that strategy from Austin and San … Read More

10 Maxims for Improving Profit through Better Pricing

Your price ceiling is limited by the Perceived Differential Value of your offering.  Customers determine this, but you can help them along the way. Your price floor is limited by your costs.  If your floor and ceiling are the same … Read More

Don’t limit yourself on price

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 … Read More

The best 5 minutes of TV for sales

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 … Read More

The World Cup, Data Analysis, and Maximizing Profit

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 … Read More