Methodology

Current State Discovery to develop a complete understanding of the existing state, which includes background and roadmap, of your products or service offerings in the market.

Oftentimes, there is more to the story than what the data is showing. There may have been changes in management, customers, partners, alliances, suppliers, marketing, products, pricing or the market that shine more light on what research needs to be done or decisions should be made with the new data. We may discover the reasons things have been done historically no longer apply. This stage is not to be taken lightly as it could be the difference between okay and exceptional pricing.

Value to Customer to conclude who your preferred customers are, how they are segmented, and what they truly value in your offer to prefer it over its alternatives.

Sometimes clients are selling the wrong offers to the right customers or vise versa. This often compromises margins via excessive discounting. Larry Best says it best, “Anyone can sell a Mercedes for the price of a Hyundai.” The key is to ensure you are selling the right (i.e., desired) offerings to the right (i.e., profitable) customers. This includes understanding that some customers may not be profitable and therefore should be sold something different or nothing at all.

Competitive Landscape to understand the alternatives, what differentiates our client’s offer from them, and how that differentiation is valued by the preferred customer(s).

One of the worst things clients can do is fail to grasp how their offer faces against the competition. There may be some significant positive or negative differentiators of your offer. Competitive intelligence turns all findings into ammunition for your sales team to use when customers demand discounts. This will help them to talk less about price and more about differentiated value. We can further expound upon this with optimized discount management.

Packaging to determine how your products or services will be offered in the market (e.g., features, tiers, support, buying model, bundles, add-ons, licensing, etc.)

During this stage, you may ask yourself these types of questions:

Perhaps you shouldn’t be offering the limited version as it is cannibalizing sales from the standard version which is twice the price?
Perhaps you need to include one more feature in the better version offer to make it viable?
Perhaps you need to charge per 10 concurrent users per year rather than per GB per month?
Perhaps you need to have a superior offer to drive the buying behavior more towards the mid-tier offer?
Perhaps you should only offer this limited offer via a monthly subscription with overage?

We discover these and many other insights from the customers themselves through both qualitative and quantitative study.

Pricing to calculate optimal pricing for finalized offers to achieve company objectives (e.g., revenue, ARR, EBIDTA, market share, etc.).

You may find yourself wanting to increase the offer price x% without realizing the additional churn that would more than cancel out the potential benefits. The demand curve is real and price points need to be adjusted to maximize revenue, ARR, EBIDTA, or market share. This stage uses customers, competitors, and historic data to maximize accuracy and confidence.

Final Recommendation to produce a comprehensive summary of findings, pricing and packaging recommendation with net impact as well as KPIs to measure success.

Although self explanatory, the summary of findings helps you to understand how PriceOptics arrived at the final recommendation. It’s also imperative for your company to measure the success.

Implementation to effectively execute the agreed upon pricing and packaging plans by working with Rev Ops and other necessary teams.

This turns the vision or into a reality. Sometimes team members run into issues or questions along the execution path. PriceOptics will be with you and provide unique guidance to any and every situation to ensure you can fully recognize your return on investment in pricing both short- and long-term.