In the wide world of retail, every product or business seems to need some kind of a unique value scheme these days. They need something to set their specific product or brand apart from all …Continue reading
While this advice is admittedly self serving, I’ve grown very skeptical of the recent trend of B2B Pricing Consultants pairing off with B2B Pricing Software Companies as “strategic partners”. The issue isn’t the pricing software. …Continue reading
If you’re managing a decent sized distributor, you’ve probably been approached by at least one consulting firm to talk about pricing. The concept sounds good on paper: use a few targeted price increase campaigns to …Continue reading
A competitor oriented pricing objective sets prices in response to competitor pricing decisions. This type of pricing strategy is common in hierarchical markets, where there is a good / better / best ranking of potential …Continue reading
You may safely assume that if I am in your conference room, I’m not there to hand out the Jack Welch award for business excellence. I specialize in turnaround management. Specifically the commercial parts. This …Continue reading
A sales oriented pricing is a pricing objective that aims to facilitate sales and market share growth. The goal is to use pricing as a tool to help drive “smart growth”. Thus, companies using this …Continue reading
Few things are quite as powerful in business as being able to “show me the money”. Pricing is no exception. Setting up a good system of pricing performance reports will help you achieve a broader …Continue reading
Sales Oriented Pricing Business Goals – What Pricing Goals Do I Need to Achieve?
Do you ever feel confused about whether your customers are being charged the right price for the product or service? Or do you feel that every time you call your customers, it is possible to hear a sigh of relief as they tell you they don’t mind paying more than your current price?
Do you find yourself frustrated with customer communication issues as well? If so, then you might be experiencing the cause of the problem.
You might have a vision of your business and product based on things that might be considered unrealistic. For example, a product that is too difficult for a standard human to understand might be deemed impossible. Or maybe you have a goal that is so far out of reach that you have never thought about it before.
If your products or services are too expensive and out of reach, it will deter customers from wanting to buy them. They may instead opt for what is affordable and available, even if they have a lot of trouble understanding it.
To be successful in a competitive market place, you must have a vision of how your business will operate. If you don’t, your pricing goals could be misguided.
I call this my Survival Pricing Principle. It’s really quite simple: Sales Oriented Pricing for a business that is Successful requires that we have an eye on our company’s true potential.
In other words, it is only by focusing on our competitors that we can grow our business and succeed. Yes, there are many times when it is necessary to set reasonable pricing goals, but the most important rule to keep in mind is that any time we are trying to compete with our competitors, we must not be focusing on how much we can charge or what we should charge.
We must focus on whether we can deliver exactly what customers need, whether they will come to us and spend money in our store and if we can deliver it at a price that’s lower than what our competitors charge. Only then will we be successful and continue to grow.
There are many occasions when we will need to focus on more Sales Oriented Pricing. When you have something new to offer, to attract a new segment of customers, to change your pricing strategy or to increase advertising to your list, this will mean adjusting your business model.
On the other hand, if you can follow through with a credible statement of your competitive business model and maintain a clear vision of what you want to do for your customers, you can accomplish a sustainable sales growth. That’s because the formula for a success business has nothing to do with how much you sell.
Instead, it has everything to do with how you sell and how you deliver. In other words, a successful business model doesn’t require you to get a big percentage of the money you sell to make a good living for you and your employees.
In the end, any money you have or are making from selling your product, or whatever you are doing for your business, should be a reflection of your current profits and any future profits you are going to make. And that, to me, is the answer to the question, “What pricing goals do I need to achieve?”