Pricing Table Topics: Jack of Diamonds - Sell Like You Don’t Have Competitors

Paul Orlando is the Founder of Startups Unplugged and is the author of the book “Growth Units”, a book that makes unit economics straightforward. He builds incubator/accelerator programs around the world, getting companies to solve problems that they couldn’t in other ways, which allows the building of autonomy and skills that keeps employee retention high and maintains the company’s top talent. Paul is an adjunct professor and runs the incubator at USC. In this episode, Paul talks about calculating lifetime value as he shares why it is important to think about pricing in relation to the LTV.   Why you have to check out today’s podcast: Understand the relationship lifetime value has with pricing and why it’s better to learn early and often than to fail fast Find out why overpricing and underpricing are present in various companies Discover why your lifetime value isn’t and will never be limited to one number   “People are really afraid of raising prices. I think it was Marc Andreessen who said, 'a lot of problems go away if you can raise your prices.'” – Paul Orlando   Topics Covered: 01:22 – How Paul got into the work of running incubators 03:16 – Building incubators and accelerators inside a company and changing the way people work to achieve a certain goal 06:05 – Why ‘learn early, learn often’ is a lot better than ‘fail fast’ 08:32 – Writing a book about calculating lifetime value and its components; why thinking about pricing is important 17:15 – Pricing and lifetime value; discussion about over- and underpricing 21:00 – Thinking about lifetime value in relation to subscription and non-subscription businesses 26:03 – Your lifetime value is and will never be limited to one number; why you should model the sequence of flows 29:56 – Why Paul prefers using payback time as a metric as opposed to LTV/CAC 31:23 – Paul’s pricing advice for this episode’s listeners   Key Takeaways: “I actually don't want people to fail fast. I don't want them to fail slow, either. But I'd rather that they succeed fast, or second-best – succeed slow. So, I'd like to say, learn early learn often rather than fail fast. Learn early - encounter the customer upfront rather than downstream, and learn often - keep that process going like you really probably have not figured everything out just yet. You need to keep iterating. There's so much that you could test before you have committed serious resources.” – Paul Orlando “If price is some metric of value or some measure of value, you want to be able to charge something. You don't necessarily want a business that has to push prices as low as possible.” – Paul Orlando “Lifetime value is not something that you can really get a full picture of until you've been out for a while.” – Paul Orlando “These ratios or numbers that you hear about can be misleading unless you actually start digging in a bit.” – Paul Orlando “If you can start to either shorten that time, taking pre-orders, or if there's something that you can do with your own supply chain, tough today, but if there's something that you could do there, you could improve your odds of being able to use customer revenue to grow.” – Paul Orlando   People / Resources Mentioned: Growth Units: Learn to Calculate Customer Acquisition Cost, Lifetime Value, and Why Businesses Behave the Way They Do: https://www.amazon.com/dp/B08GJVV8RJ/ Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business: https://www.amazon.com/Win-Keep-Grow-Accelerate-Subscription/dp/1631954784 MoviePass: https://www.moviepass.com/ Uber: https://www.uber.com/ Dollar Shave Club: https://www.dollarshaveclub.com/ Amazon Web Services: https://aws.amazon.com Coke: https://us.coca-cola.com/   Connect with Paul Orlando: LinkedIn: https://www.linkedin.com/in/porlando/ Email: orlando@gmail.com Twitter: https://twitter.com/porlando   Connect with Mark Stiving:    LinkedIn: https://www.linkedin.com/in/stiving/ Email: mark@impactpricing.com

7 Feb 202232min

This is an Impact Pricing Blog published on December 29, 2021, turned into an audio podcast so you can listen on the go. Read Full Article Here: https://impactpricing.com/blog/call-it-customer-impact/  If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact. Connect with Mark Stiving:  Email: mark@impactpricing.com LinkedIn

4 Feb 20222min

As far as loving you is concerned, obviously, they love low prices; they love discounts. But the real love happens when we can deliver a ton more value than what they expected, what they actually have to pay for. These are the raving fans, the people who really value our products. And yet we couldn't capture all of that value even if we wanted to.  “Pricing has the power to make your customers love you, hate you, or anything in between.” - Mark Stiving As to hating you, customers will absolutely hate you when you raise their prices without some reasonable explanation, without doing something nice for them, because customers hate price increases. And of course, if our pricing is just ridiculous; if it's horrible, for whatever reason, they will learn to hate us. So pricing really is very powerful, it causes emotions inside our customers. We want to make sure we're managing those emotions carefully.  We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.  Now go make an impact. Connect with Mark Stiving:  Email: mark@impactpricing.com LinkedIn

2 Feb 20221min

Damien Robert is currently the Chief Solution and Delivery Officer at Pricemoov. He's been at Simon-Kucher & Partners (SKP) for 17 years of his career so he actually understands pricing really well. Damien also took a three-year stint at Disneyland Resorts Paris. Damien develops and implements tailor-made pricing solutions, ensuring easy price steering across the organization. In this episode, Damien talks about Machine Learning and how it helps optimize inputs in the pricing work as he shares insights in relation to Pricemoov’s models.   Why you have to check out today’s podcast: Find out what Machine Learning (ML) and Artificial Intelligence (AI) are all about and how these two are used in pricing Discover simple and advanced pricing strategies you can implement to reach a bigger market Understand why looking at price in the perspective of your client is a good move towards success   “Look at your prices with the client view.” – Damien Robert   Topics Covered: 01:32 – How Damien got into pricing 02:34 – What does pricing mean for Damien 04:28 – Damien’s pricing story when he was still in Disneyland 06:25 – What makes Pricemoov different in the pricing market and how Damien got involved with them 08:50 – Simple and advanced pricing strategies people can implement 10:57 – Collecting competitive pricing information with car rental companies 13:00 – Defining Machine Learning (ML) and Artificial Intelligence (AI) alongside the things they do 16:45 – Using ML to forecast the effects of the decisions made for pricing 19:54 – Mark’s Amazon story: his $20 book reaching a price $225 in Amazon 22:00 – Damien working in a theme park, the existence of black box 24:57 – The things Pricemoov considers when making pricing models 27:00 – Damien’s pricing advice for today’s listeners   Key Takeaways: “Pricing is not only a price, but also the way you message it and what you can achieve.” – Damien Robert “Our software is allowing you to configure the rules that we provide. So, you have a set of rules, you, yourself, decide which one you want to use and implement for your product portfolio, because you may want to use one or another one, and we can basically train you on which one you want to use.” – Damien Robert “That's what people misunderstand. Sometimes in machine learning and artificial intelligence, they think that the model by itself can be smart. The reality is that the model is not smart, but the model can be much more granular and fit much more kind of situations because his granularity and the computer allows, basically, to have so many computations and so many different alternatives.” – Damien Robert “Somehow, machine learning can be used to optimize part of the dimension, some of the inputs, but basically, at the end of the day, you need a skeleton of decision making, which is important to have. Otherwise, you do not take the long-term impact of price changes. You do not take the potential competition reaction. So, you're missing a lot of the points.” – Damien Robert “Very frequently, you just optimize, set a price, but you do not check the consistency, you do not realize some of the price points, and you won't even realize that the way your prices are featured on the web is sometimes a catastrophe. So really, just look at the end of the tunnel and look at it because you will have a lot of surprise, especially on promotion. 50% of promotional faders are usually related to execution. It's not at all related to the design of the promotion itself.” – Damien Robert   People / Resources Mentioned: Pricemoov: https://pricemoov.com/ Simon-Kucher & Partners: https://www.simon-kucher.com Tesla: https://www.tesla.com/   Connect with Damien Robert: LinkedIn: https://www.linkedin.com/in/damienrobertpricemoov/# Email: robert@pricemoov.com   Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: mark@impactpricing.com

31 Jan 202228min

This is an Impact Pricing Blog published on December 22, 2021, turned into an audio podcast so you can listen on the go. Read Full Article Here: https://impactpricing.com/blog/the-art-of-pricing/  If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact. Connect with Mark Stiving:  Email: mark@impactpricing.com LinkedIn

28 Jan 20223min

Real value comes from real differentiation. Real value is turned into perceived value through marketing.  When we're up against the competition, which most of the time we all. Our customers are buying perceived differentiation. They look at our product or competitors' products. What's the difference in price and is it worth it? And the, ‘is it worth it’  has everything to do with the difference in capability, the product differentiation, the features that are different.  “Build real differentiation, but we have to make sure our customers know it.” - Mark Stiving Now we may have built the best product in the world. We may have built a product that is much, much better than our competitors, but if our buyers don't know that. If they don't believe that, then they're not going to choose our product buyers.  Aren't buying based on real differentiation? They're buying on their perceptions or what we'll call perceived differentiation. Our job as a company should be to build products that are truly better than our competitors.  In other words, build real differentiation, but we have to make sure our customers know it. And that comes through marketing. It comes through sales efforts. We have to make sure we're communicating the fact that our product is better/different than our competitors.  We hope you enjoyed this podcast. If you see have any questions or feedback please email me mark@impactpricing.com.  Now go make an impact. Connect with Mark Stiving:  Email: mark@impactpricing.com LinkedIn

26 Jan 20221min

Ebrahim El-Ebiary is a Pricing Manager at Goodyear Tires. He’s been with Goodyear for six years now, having worked in Revenue Management at FedEx before that. Ebrahim is a Professional Certified Coach and he's genuinely interested in people and how they think. In this episode, Ebrahim talks about the importance of curiosity and good relationship to your pricing practice as you continue to make money through helping your customers do the same.   Why you have to check out today’s podcast: Learn about what revenue management is and the relationship it has with pricing Understand why it’s important that pricing people understand their customers’ future while having the customers take part in the creative process Find out about the benefits of having a good relationship with your customer and keeping that relationship until it lasts   “Before launching a very detailed analysis, ask the question, ‘how will this be used?’” – Ebrahim El-Ebiary   Topics Covered: 01:11 – How Ebrahim got into pricing 01:59 – Revenue management’s relationship with pricing and yield management 03:48 – Does Goodyear have revenue management? 04:40 – Defining a coach and what a coach does; Is Mark a coach? 06:05 – Pricing and coaching as different sides of the same coin 07:50 – Why curiosity is important in keeping relationships with customers 09:27 – Questions to ask in order to better understand a customer’s future 11:53 – Why it’s important for tires to be talking to each other 14:26 – Where the idea of communicating tires came from 15:42 – Having the customers take part in the creative process and keeping that relationship with them 19:08 – Being in a zero-sum game situation of price negotiation 23:12 – Expressing complex analysis into simple statements to not lose your customers 26:32 – Pricing advice for today’s listeners   Key Takeaways: “A coach is someone that supports people getting from where they are to where they want to get to, not where he or she wants to get, where they want to get to. A coach does not tell you or does not impose their point of view.” – Ebrahim El-Ebiary “Making money is “the easy part” of it (doing business). Having the story and the vision, now that's where moneys truly made in a sustainable manner.” – Ebrahim El-Ebiary “Discovering the future comes from asking about the legacy that they want to build mixed with free flow working sessions where we pick on each other's ideas jointly.” – Ebrahim El-Ebiary “One thing remains at the heart of business is people. Once we lock in that relationship of trust and joint creativity, then we come back to do business together. That relationship then grows and flourishes, and with that, profits grow and creativity grows and the demand for new products that didn't exist or new services from existing products come to life.” – Ebrahim El-Ebiary “Know the question you're trying to answer before jumping into a detailed analysis or investing in a pricing system software, hiring more people. Just know what question you're answering.” – Ebrahim El-Ebiary   People / Resources Mentioned: Goodyear Tires: http://www.goodyear.com/   Connect with Ebrahim El-Ebiary: LinkedIn: https://www.linkedin.com/in/ebrahim-elebiary/ Email: ebiary@gmail.com   Connect with Mark Stiving:  LinkedIn: https://www.linkedin.com/in/stiving/ Email: mark@impactpricing.com

24 Jan 202228min

This is an Impact Pricing Blog published on December 15, 2021, turned into an audio podcast so you can listen on the go. Read Full Article Here: https://impactpricing.com/blog/the-best-attitude-for-a-great-value-conversation/ If you have any feedback, definitely send it. You can reach us at mark@impactpricing.com. Now, go make an impact. Connect with Mark Stiving:  Email: mark@impactpricing.com LinkedIn

21 Jan 20222min