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"We need to give them a win"
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"We just raise up the price 30% and then go and give them (the customer) a 30% off. That way they'll go to their boss saying they got a deal. And they'll buy" Their closing rate: 40% Reality? A product in the market that's underpriced —and living in a discount culture. Money left on the table? A couple million euros per year. Here's the thing: Inflating your prices to give a discount means a couple of things:
Giving them a win doesn't mean to cut your prices down, but how it can be profitable for them AND for you. For both parties to be happy with the deal, and for you to find ways to better-serve them. And that's not math. |
Rod Aparicio
Get one tip, question, or belief-challenge that just might change the way you market, to help your customers buy. A *daily* email for b2b founders on improving your business —without the bullshit.
"We're dedicated to our customers." Shit. I'd sure hope so. Would you choose to pay a significant amount of money to someone who's not dedicated and does an incompetent job? How do you define who's more dedicated, when everyone also claims the same? Maybe dedication (as effort, or passion, or how long it took you to know how to) is not your differentiator. Maybe it's the bare minimum expected from you. What makes you different in your market?
Who told you it's greedy / needy / bad to have high prices? Who told you it's good to give discounts? Who told you that giving a discount is a show of appreciation? Who told you that a discount is "making the customer feel good"? Who told you that your offering is "too expensive"? Who told you you need to do what your competitors are doing? Who told you revenue is the thing to focus on? Who told you pricing is covering your costs and adding a margin? Who told you things are this way because...
A common belief is that over delivering delights your customers. That's a misconception. You can delight them with delivering on your promise. Over delivering entails expanding your costs without a defined scope. You train your customer to expect more than what they pay for. You train your customer that if you raise your prices, you'll expand the scope. You underprice your offering. Delighting your customers has nothing to do with over delivering. It has to do with setting expectations and...