Ep29: Adrienne Gordon – Empowering You To Achieve Pricing Excellence

 

Adrienne Gordon has a passion for the power of pricing. She has dedicated her career to pricing since 1999, working with multiple companies in several different pricing roles. She began her pricing career at Parker Hannifin as the project manager of their global strategic pricing initiative. During this time, Adrienne worked with multiple consulting groups and revenue optimization technology companies as she helped architect the vision for Parker’s Best in Class pricing approach. From there, Adrienne took the Director of Pricing role at American Greetings, where she executed a multi-phase value pricing research effort ultimately resulting in the redesign of their approach to pricing cards. At Eaton Corp, she worked with several different businesses on strategic projects as an internal consultant. Finally, in 2009, Adrienne became an external pricing consultant based in Northeast Ohio, working with dozens of companies in the manufacturing and distribution space. Today, she is a blogger, author, and entrepreneur. Prior to pricing, Adrienne held several roles in Technical Sales and Marketing. She holds an MBA in Marketing from Western New England College and a Bachelor’s in Engineering from Boston University. 

 

In this episode, Adrienne takes us to dig deeper into the culture of fear in pricing that is pervading an organization. She manages to uncover bit by bit where this fear is coming from at the same time provides a perspective where all these fears can be removed thus capturing a full value for a product. With expertise spanning two decades, she has but a lot of inputs to share about winning deals even when you increase prices, where most organizations are afraid to toe in. 

Why you have to check out today’s podcast:

  • Understanding the complexities each organization have involving pricing and zeroing in on how to capture a product’s full value  
  • Understanding Fear and Competence when talking about value pricing, digging deep into how to do it (increasing prices) side by side with the confidence to do it 
  • Getting an overview of a masterclass about value pricing and what value can you get from it 

 

“When in doubt, offer versions and your customer will opt into the best value proposition for themselves and you’ll learn a ton about your business.”

– Adrienne Gordon

Topics Covered: 

01:07 – What got her into pricing 

02:46 – Scope of her work as a pricing manager at Parker Hannifin 

05:57 –  Where is the culture of fear in pricing  manifesting in an organization 

06:57 –  Her thoughts on companies building a great product but not good at capturing value for their product 

08:46 –  How to fix that culture of fear of pricing in an organization 

09:41 –  How to remove fear to capture a full value 

10:36 –  Of fear, of competence, of metrics and of analytics. How do these relate to pricing and value 

15:11 – How do I do it versus do I have the confidence to do it 

16:58 –  How to win deals even when you increase prices 

18:51 –  Tools to help companies have the confidence in going about their value pricing 

19:32 –  Talking more about the masterclass she is offering on value pricing 

20:14 –  Who is this  masterclass for  

22:08 –  Giving her  best advice on value pricing to impact your business 

 

Key Takeaways: 

“So companies that think about this, in my opinion, in the right way, look at it as a process. Knowing that it’s not going to be perfect, we’re going to have an opinion on our strategy, we’re going to execute it flawlessly, we’re going to measure what happened. I’m going to optimize that strategy. It’s very simple. And I think when leadership can articulate that, that’s how they want to approach pricing from a continuous improvement process standpoint. It gives their teams the comfort that it is gonna be okay, a little bit of failure is okay cause we’re going to learn and we’re going to get better.” – Adrienne Gordon 

 

“And so all the work that a lot of organizations do around pricing around the data science, around this strategy and testing and the research, It’s all good stuff, but at the end of the day, it’s really just taking that information and getting it in front of a person to say it’s okay to ask for a little bit more.” – Adrienne Gordon  

 

“Leadership will never be effective at attaining their full value unless they recognize their job is to remove the culture of fear.” – Adrienne Gordon 

 

Connect With Adrienne Gordon 

 

Connect with Mark Stiving  

Full Interview Transcript

(Note: This transcript was created using Temi, an AI transcription service.  Please forgive any transcription or grammatical errors.  We probably sounded better in real life.)

Adrienne Gordon: Leadership will never be effective at attaining their full value unless they recognize their job is to remove the culture of fear.

Mark Stiving: Welcome to Impact Pricing, the podcast where we discuss pricing, value and the amazing relationship between them. I’m Mark Stiving and today our guest is Adrienne Gordon. Here are three things you really want to know about Adrienne, before we get started. She’s been in pricing for over 20 years with companies like Parker Hannifin, American Greetings and Eaton on her resume. She’s been involved in pricing consulting for over 10 years now and for three years, she’s been homeschooling her daughter. How’s that for pricing? Welcome, Adrienne.

Adrienne Gordon: Hi. Thanks for having me, Mark.

Mark Stiving: Hey, how did you get into pricing?

Adrienne Gordon: Like most people, I fell into it. I didn’t actively pursue a career in pricing, so basically started my life as an engineer. I hated it, went into technical sales, liked it, and then ended up in a product manager role for Parker Hannifin back in the late nineties and at the time there was a consultant calling on Parker talking about this concept of strategic pricing and they decided to do a pilot at one of the Parker Divisions. So Parker’s the conglomerate of about 130 different companies in manufacturing and distribution. So I just happened to be at a division that had a lot of complexity. So many, many products, a lot of custom products, multiple channels, multiple end-use markets. And they decided to use my division as their pilot and they look for somebody who could help run it and they look down the bench of product managers. And at the time, I was the only one without white hair. So they knew it was going to take a computer and it was going to take some analytics. And I was the only one with the toolset and the capabilities to actually use the computer for what it needed to do. So I was asked to do it. It was very successful. It became a corporate initiative and I got moved to Cleveland, Ohio to be the project manager rolling it out to the 130 companies across the globe. And that’s the end of the story, right? That’s the beginning of this story, right?

Mark Stiving: Yeah. I often run into people who work for Parker Hannifin who have pricing in their titles. They must have really adopted this, this concept.

Adrienne Gordon: Yeah. So once I moved to Cleveland and became the project manager, there was three of us at corporate headquarters running the project and they basically put out an edict that all companies would have a dedicated pricing manager. So my role was to develop the standard work, the training, help have some governance over the globe for all hundred and 30 plus pricing managers.

Mark Stiving: Wow. That’s impressive. And who made the edict? Was it the CEO or was there someone below the CEO who said, this is what we have to do?

Adrienne Gordon: I think it was sort of a combined effort from the COO and the CEO at the time. So it became part of their win initiative, which was basically if that Parker at the time you weren’t working on one of three things, you probably shouldn’t be working there. And those three things were getting better at procurement, getting better at pricing or getting better at operations. So it was lean strategic procurement and strategic pricing and that was the focus of the organization for years. And some of it is continuing today, as far as I know.

Mark Stiving: Wow. Well, I still see people from Parker that that have pricing in their title. So there is no doubt there are a lot of them.

Mark Stiving: Correct.

Mark Stiving: Nice, Nice. Hey, I like to ask people what are they passionate about in pricing before we start the podcast? Because then I, I know what we’re going to talk about, at least I have a feeling, and one of the answers you gave which I thought was just fascinating was valued, in particular, the fear of value in company culture. What the heck does that mean?

Adrienne Gordon: So for years, doing pricing, I really had my technical hat on and I really thought pricing was this really cool strategic exercise that had science behind it. And so I got to, you know, kinda touch that engineering side of my brain. But also, you know, spend a lot of time talking to people about strategies. So a lot of time spending time with people and I’m very extroverted. But as I matured in my understanding, I came to this conclusion one day, I don’t know, a couple of years ago that all of that pricing science and strategy, it’s really about getting companies to ask what they deserve, right? So as humans we tend to undervalue ourselves, right? So we don’t always ask for what we’re worth for our salary. We are afraid of those conversations. We’re afraid of what other people are talking about us, right? So when you take a whole bunch of humans that have that in the just part of their own being and you put them into an organization together, right? That tends to feed off each other. And so it almost starts becoming exponentially bigger and bigger. So somebody says, well, I don’t sink. Our organization has enough value to ask for that higher price. Then somebody else says, yeah, I think you’re right. Right? And so we started to feed off of one another. And so all the work that a lot of organizations do around pricing around the data science, around this strategy and testing and the research. It’s all good stuff, but at the end of the day, it’s really just taking that information and getting in front of a person to say it’s okay to ask for a little bit more.

Mark Stiving: If you were to pick the place where the fear is, or maybe I would say is the biggest, is it the product management side? Is it the sales side? Is that the executive team? Where do you see that fear really manifesting itself?

Adrienne Gordon: I think it can manifest in a lot of different areas. I think it depends on the culture of the organization. Obviously, if you’re customer-facing, you’ve probably dealt with some powerful person in procurement at some point who told you that you’re not as good as your competitor. Right? And that resonates at some level. But sometimes it could be estimated, right? They think, well, we’re doing good enough. We don’t need to do anymore. Same thing in finance, right? We’re doing good enough, but I think most importantly it doesn’t really matter where it resides. What matters is who takes ownership of it and that is leadership. So leadership, we’ll never be effective at attaining their full value unless they recognize their job is to remove the culture of fear.

Mark Stiving: I think it’s funny because oftentimes I’ve talked to executives and they recognize that their teams don’t do a good job at capturing value. They believe that we’ve built a company that builds a great product and yet we’re not doing a great job at capturing all that we’re creating. Is it that they don’t know how to fix that inside their team?

Adrienne Gordon: I think sometimes it’s they don’t know how to fix it. I think sometimes it’s that they are not competent enough in their own positioning, right? So a really strong leader that supports the pricing function in the organization, can state with conviction that we are the price leader or we are positioned to be the everyday low price or we are positioned to compete with the following mid level competitors.

Mark Stiving: So Adrienne, do you think that executives have the same fear of value?

Adrienne Gordon: I think some do. I mean I know some do actually. So over the years, I’ve worked with clients that want to dip their toes into price leadership. So they’ll do a bold move basically announcing a big price increase or something like that. Only to, you know, two weeks later talk to the large customer and say, okay, but except for you, I won’t raise your price. And then they start, you know, down the path of just opening up the flood gates for everybody. Right. So I do think a lot of executives are fearful,

Mark Stiving: Huh? How do we ever fix this, if executives are fearful? I could see if the executive wasn’t and the team was, now we have a solution. But how do you get executives to recognize that they’re scared?

Mark Stiving: Yeah, actually it’s a great question. So we’ve been working at pricing empowered on a system to actually identify behaviors of organizations that do pricing very well, and we look at the behaviors that they have. And those behaviors tend to resonate with companies that do not have a fear of value. And so there’s like eight different areas of behaviors that we look at, but there are areas that executives can focus on and see where they are weak and address those areas while they do it, it basically results in a higher confidence of value organizationally.

Mark Stiving: Hmm. As you run this, let’s call it a metric, I guess, do you know, are you actually measuring fear of value or are you measuring the fact that people aren’t capturing their value and you make the assumption that that’s because of fear?

Adrienne Gordon: Good question. So I always walk into a company assuming that there are only one of two possible scenarios. Either the organization is capturing their full value or they’re capturing somewhat less. So I’m usually assuming they’re not capturing more than they’ve actually created. Right.

Mark Stiving: Otherwise you wouldn’t be very useful.

Adrienne Gordon: Right. So assuming that new companies had hit their ceiling, right. It’s a pretty good bet that there’s some area to play. And from there then the metric really is identifying where’s the block from obtaining that full value, whether it be policy or process or organizational structure or sales readiness or their analytics capabilities, whatever is blocking their ability to have their full confidence to go ask for that next bit.

Mark Stiving: And where does fear come into that? cause those things you just listen to me didn’t say fear as much as they said competence,

Adrienne Gordon: Confidence. So yeah, I’m using confidence as the Antonym of fear. So the idea is if they’re short one of these eight behavioral areas, they may have a block of confidence, A.K.A fear in that area that we can remove.

Mark Stiving: Yeah. I hope you don’t mind. I want to push on that a little bit and it isn’t that I disagree. I’m not sure I understand yet. So if you pick one, I’m horrible at metrics. I’m horrible at data analytics. That’s a competency problem that I could teach you how to get better at it, and I could get you to get your pricing improved and that may have nothing to do with fear or confidence. Does that make sense? Or am I missing something?

Adrienne Gordon: So I’ll give you an example on analytics, right? So there will be organizations where without data, right? They’ll be stories of horrific things that have happened the last time we asked for a price increase, right? We went in and we asked for three and we lost 50% of our market share. Okay? Show me. And when you actually pull the data together, right? Then the story changes a little bit because you can’t fight with the data. The data are what the data are. So one of the things that I like to do to help build confidence with clients is let’s start with something pretty low risk. All right, let’s identify your business, a part of your business that it wouldn’t be catastrophic if it went away. And we’re going to test something you haven’t done before. So let’s say you’ve kept your value, ask for 3% more than last year. We’re going to go for 10 in this area and we’re going to measure it and see what actually happened. So by removing the blockade of that capability of measuring it, right, that argument is removed, right? And you can actually empirically show, all right, now we’re a little confidence because we were able to do that successfully. Let’s try the next more risky area.

Mark Stiving: How’s the podcast going? Are you getting value? Research shows the people don’t really value what they get for free, but I’m hoping you’ll prove this research wrong. Please demonstrate to us and the entire world that you value this podcast. Would you please pause the podcast? Subscribe if you haven’t already done so. Rate the podcast and leave us a short review. You’d be doing a huge favor and research shows, if you invest this little bit of time, you’ll probably like the podcast even more. Win-Win! Pause. Do it now. We’ll wait for you.

Mark Stiving: So I’m completely with you in all of the actions. The only struggle I’m having is I could articulate doing these without using the word fear. That’s the only struggle I’m having.

Adrienne Gordon: And that’s possible, right, that you can do these activities. And I think most pricing consultants do, right? Most pricing consultants do activities and analytics. They do activities and process redesign, but at the end of the day, you can be a rock star organization in any of those areas. If somebody doesn’t take that information and go and ask for something better than they used to get, it doesn’t matter.

Mark Stiving: Yeah. Hi. Oh my gosh. So there are actually two conversations we’re having at the same time and I’m trying to figure out how to separate the two. One is technical competence or capability to do the things we have to do in pricing. And then the other is the guts to actually go implemented and do it and test it and try it. I love this concept that says companies are fearful. I’m just trying to separate those two different thoughts.

Adrienne Gordon: Okay. So help me understand how they’re intertwined or not intertwined in your logic.

Mark Stiving: Oh, in my mind it’s, I think it’s very possible that I don’t know how to do data analytics, but I’m amazingly confident at my value and my pricing. I also think it’s very possible that I’m amazing at data analytics and I can calculate that my value is this huge number. I just don’t have the guts to ask for it.

Adrienne Gordon: Okay. So that’s true. So one of our behaviors is around sales readiness, and so you can have a very confident customer-facing team, right? That has zero understanding of where they should be. And that’s possible that they’re fearless and they may overshoot their value. Right. So that would be an exception to the rule. I don’t think most organizations have that problem. Most organizations don’t have a problem of an overconfidence salesforce that is behaving in a vacuum of information.

Mark Stiving: I’ll agree with that. Absolutely. Absolutely. And I was only using that as an example to say I could see how they’re two different things. I’m not trying to say that one’s not important. I think they’re both crucial. But if I’m not achieving the value that I’m creating, if I’m not capturing the value I’m creating, it could be because I don’t know-how. And it could be because I don’t have the guts or confidence. That’s what I’m trying to separate is the how do I do it versus do I have the guts to do it? Does that make sense to you?

Adrienne Gordon: It does. I just, I do see them interacting, so…

Mark Stiving: I’m sure there’s a huge interaction between the two. And I think one of the things I love about this conversation, first off, anytime I’m learning something, I love that. But secondly, I think that this concept that says companies are afraid that they don’t have the confidence to do what they want to do is a huge thing. And how do we get companies over that? So let’s shift the conversation to that question. How do we get companies to become more confident that they can charge higher prices or win deals at higher prices?

Adrienne Gordon: So I think, you know, again, to me it’s a continuous improvement process. So that’s how I look at the pricing in general. I do think that a lot of organizations look at pricing as an event, right? We’re going to do a pricing event or a pricing action and they’re not really thinking about it from a holistic standpoint of the ability to be perfect at any given time in your pricing. For most companies it’s complex, right? Because not everybody’s going to value the product, the service the same way. And you know, if you have more than one customer, right? That exercise can be difficult. So companies that think about this, in my opinion in the right way, look at it as a process, right? So knowing that it’s not going to be perfect, we’re going to have an opinion on our strategy, we’re going to execute it flawlessly, we’re going to measure what happened, right? I’m going to optimize that strategy. It’s very simple. And I think when leadership can articulate that, that’s how they want to approach pricing from a continuous improvement process standpoint. It gives their teams the comfort that a miss is okay, a little bit of failure is okay cause we’re going to learn and we’re going to get better.

Mark Stiving: I think that makes a ton of sense. So first off, all of us pricing people would agree that pricing is a process. It’s not an event. I think that’s a no brainer for us. I’m not sure the companies believe that, but we certainly think that’s true. And if you could convince companies that it’s a process and that they’re constantly testing and tweaking and measuring, then their confidence goes up pretty dramatically. I could see how that’s a great way to grow confidence inside of customer. And so are you doing this today? Do you have a program in place that you sell to companies or that you teach companies to say, hey, I want to make you more confident in your pricing?

Adrienne Gordon: Yes, thank you for the ask. It’s been a shift. So we’ve been developing tools over the last several decades, right, where we have been measuring behaviors and really looking at these commonalities across dozens of companies that do this well and then do this poorly. And so recently we actually did package it up. So we’re going to be launching a new service in the next couple months. Really just aimed at executives and doing a masterclass to help them basically measure their own organizations and where the gaps are in understanding the value. If the employees feel like they have the right tools to defend value so that we can help executives remove those roadblocks.

Mark Stiving: Is this the same thing or different from a pricing audit, which a lot of pricing consultants do today?

Adrienne Gordon: It is different. It’s more of a masterclass. So the design is that about eight different companies will be paired together depending on different industries, not competitive situations. And we will be working through (inaudible) program where they will be doing exercises with their teams throughout those eight weeks. And then there will be an opportunity each week to have a one on one to review the output of their exercises for direct one-to-one consulting.

Mark Stiving: Nice. And these are all CEO’s or other really high executives?

Adrienne Gordon: Yeah, so the invite is, and again we’re just about to test this in September, so the design is COO, CFO, CEO, general manager of a fortune five.

Mark Stiving: Yeah, I think that’s a great idea. I love the idea of executives being able to work with other executives to learn from each owner, to test, to push each other. I think that’s absolutely brilliant. I’m looking forward to hearing how it goes for you.

Adrienne Gordon: Me too. And it is the combination of toolsets that we have used with, you know, again, over a hundred companies at this point. And you know, there’s a lot of confidence that these tools really do identify areas of opportunity very quickly. So I believe there’s gonna be a lot of value in it.

Mark Stiving: Nice. Well, and so the fact that we know that we deliver value is one thing. Yeah. We have to be marketing people. We have to find a way to convince other people that we deliver value too, which I find often the hardest thing for pricing people to do.

Adrienne Gordon: Yeah. Well, and it’s practicing what we preach. Right? So it is, it is a challenge. And you know, I’ve cried over the years, everything from revenue share and other pricing structures myself to help practice what I preach. Right. And defend it. But it is challenging when you have to look at it yourself.

Mark Stiving:I have to say my favorite thing in the world to do is to coach pricing consultants on how to price because, because we know how to teach people how to price, but as soon as you’re talking about me, oh no, no, no, no. That’s different. I can’t negotiate. I can’t charge a high price. They’re not going to hire me. Oh, I just find that so funny. So, Adrienne, we’ve got to wrap this up, but let me close with my favorite ending question. What’s one piece of pricing advice that you would give our listeners that you think could have a big impact on their business?

Adrienne Gordon: When in doubt, offer versions and your customer will opt into the best value proposition for themselves and you’ll learn a ton about your business.

Mark Stiving: Nice. Nice. All right, Adrian, thank you so much for your time today. If anyone wants to contact you, how can they do that?

Adrienne Gordon: Well you can go to our website, www.pricingempowered.com or you can send an email to info@pricingempowered.com and you can find us there.

Mark Stiving: Excellent. Thank you so much.

Adrienne Gordon: Thank you for everything.

Mark Stiving: All right. Episode 29 in the can and my favorite part, I love when I’m learning something, so this was fun because for me mentally I was just very focused trying to pull all this together in my own mind. What was your favorite part? Please let us know in the comments or wherever you download and listen to the podcast while you’re at it. Would you please give us a five-star review? Oh, I have a very good friend, Peter, who handed me his iPhone the other day and said, show me how to give you a review. It was hard. If you’ve got an iPhone, go to the podcast app, download or subscribe to the impact pricing podcast. Once you’re looking at the episodes, you have to scroll all the way to the bottom and then you have a chance to see the reviews and you could leave a review as well. We would love it if you’d leave us a review. Also, if you have any questions or comments about the podcast or about pricing in general, feel free to email me at mark@impactpricing.com now go make an impact.

 

**Note: Mark will participate in the conversation about this post on LinkedIn which you can get to here. 

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