This one is the Ace of Hearts from the Impact Pricing card deck.
It is true, the single most profitable pricing decision any company can make is to adopt value-based pricing. Now value-based pricing is hard to do, but it has a really simple meaning. It means charge what your customers are willing to pay.
If you had the ability to read your customer’s mind and you knew exactly the most that they would pay for your product, then you could charge that and you’d win the deal. And you couldn’t have won it at a higher price. And if you charged a lower price, then you left money on the table. So that’s absolutely the optimal approach.
Podcast: Play in new window | Download
“The single thing that should be driving our pricing decisions is thinking really hard about the willingness to pay of our buyers.”
– Mark Stiving
Of course, if our salespeople do a better job at communicating value, then we could increase how much our customers are willing to pay. So this isn’t the whole deal, but understand the concept is, we want to be able to charge what our customers are willing to pay. And to do that, it’s really an attitude inside our company.
We should be thinking instead of, hey, we charge based on our costs and we charge based on our time. We charge based on the fact that prices or costs went up. All of these things can impact how much a customer is willing to pay, but the single thing that should be driving our pricing decisions is thinking really hard about the willingness to pay of our buyers.
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/
