If you are like the vast majority of businesses, you strive to shorten your sales-cycle and accelerate closing the deal. On the other hand, some businesses are blessed with such a smooth sales process that they need to slow things down.
Darrin Fleming
Recent Posts
During initial conversations, prospective customers often tell me they’re looking for a TCO (Total Cost of Ownership) calculator or tool. My typical response is to ask what they’re trying to accomplish so we can explore which tool (or tools) will best serve their needs. More often than not, a TCO tool can be helpful, but it may not the best solution.
Grant Thornton’s 2018 CFO Insights on New Technologies research study reveals that “CFOs are playing an increasingly important role in influencing decisions related to technology.” At the same time the study found that “only 12% of executives strongly agree that they have an effective system of measuring financial key performance indicators associated with the implementation of technology.“
The best way to increase your average selling price (and earn more commission) is to use a value selling methodology. Value selling is a proven approach to avoid or minimize price discounting and increase upselling and cross-selling, which all contribute to a higher selling price.
Previous posts in our series on value pricing have examined its risks, rewards, and mechanics, all with the goal of maximizing earnings for your company. Let’s expand on this foundation with practical tips and methods for considering the impact and likely market response to your pricing decisions.
About four years ago, we published a blog post titled Why Value Based Selling is So Successful, written by Jim Heffernan, an associate and business partner. To this day, it is our most popular blog post. It opens by providing the value based selling definition as an approach “built on quantifying the impact the service makes on the customer’s financial performance,” based on a reference from Sequeira Consulting’s website.
Our series on value pricing continues with a detailed look at how to set prices that benefit both you and your customers. Now that you understand the risks of other pricing models and how value pricing leverages the value your offering creates for customers to maximize earnings for your company, let’s look at one way to actually calculate the optimal price and the data you would need to populate the formula.
What’s your strategy for determining the optimal price for your B2B offering? If you check Wikipedia, the obvious source of all that’s true in the known universe, you’ll find 26 different pricing models or strategies. In this first of a new blog series focused on value pricing, let’s take a closer look and see how you can set prices that benefit both you and your customers.
What Can Aristotle Teach Us About Value Selling?
Value selling? Aristotle? The link between one of the greatest thinkers of the Western world and value-based sales processes is stronger than you would think!
Your ability to help B2B buyers understand the value you provide can make or break the sale. In some cases, as with our client IQS, that means communicating the ways in which the prospect or customer is losing money so that the buyer understands the potential of the solution.
