Your ordinary pricing decision maker has to answer a lot of questions:
- What price level and structure best enable my sales organization to win?
- How can I defend my prices from Ernest Deepockets at my largest account?
- How can I create a negotiation strategy that creates a win-win result?
- What service gap can I fill that will make me a little more margin?
Of the three primary pricing belief systems – Cost Based, Market Based and Value Based – only value pricing provides a good answer to these day-to-day challenges. In fact, value pricing has three great advantages:
- It is an integrated system from planning through execution. Put the pieces together and it seriously hums, wicked good.
- But if you only need a screwdriver or wrench, it is big red toolbox you can reach into to address pricing problems as they arise.
- It just makes sense. It makes sense to marketing, finance, sales and of course, customers.
So join me onboard SpaceShipTwo for an out of this world look at value pricing. The view is breathtaking.
Timothy Matanovich is the president of Value and Pricing Partners and specializes in industrial and technology pricing, especially where services are an important component of the value proposition. Value and Pricing Partners recently received the coveted Recognized Innovator Award for Excellence in Consulting from the Technology Services Industry Association (www.tsia.com)
In earlier incarnations, Tim was Vice President, Strategic Pricing and Value at The TriZetto Group, and a General Partner at Market Leaders Group. During his career, Tim has consulted globally to industry leaders such as GE, DuPont, Ericsson, PPG, VHA, First Data Corporation, and CCI.
Tim has been an adjunct faculty at Penn State and Arizona State, has written over 50 articles, and is writing his first book: Profitable Technology Services Pricing – A practical system for increasing margins by valuing and pricing services.