I had an HSD yesterday. Ron Baker calls these High Satisfaction Days.
Baker was the speaker yesterday at the Ohio Chapter of the Association for Accounting Administration that meets at the offices of the state society in Columbus.
As expected, Baker drew a crowd. Many of the attendees had never had the opportunity to hear him speak in person.
I have. Many times. Why? He makes me THINK, he helps me open my mind and learn new things and look at things in a different way….. His message is so much more than pricing.
Just one highlight from yesterday - the Five Cs of Value. For a firm to price on purpose, it must understand the Five Cs.
Baker suggests following:
- Comprehend what value means for customers. Listen for wants rather than needs. “…what customers buy and consider value is never a product. It is always utility, that is, what a product or service does for them.” Peter Drucker. Or as Charles Revson, founder of Revlon said many years ago, “In the factory we make cosmetics; in the drugstore we sell hope.”
- Create value for customers. The customer experience is more that just a product. If they are time starved, make every interaction fast and easy. If they crave connection, add those personal touches.
- Communicate the value you create. What customers really care about is WIIFM (what’s in it for me). First address the core need of the potential customer to get his or her attention. Then describe your product/service only in terms of satifying that need or want.
- Convince customers they must pay for the value. People buy emotionally and justify intellectually. When the potential customer arrives at the “buy now” screen or physical point of purchase, kick in the rational arguments: money saved, service guarantees, happy client testimonials.
- Capture value. You must capture the value you provide by utilizing the appropriate pricing strategy.
I was very proud yesterday because two of my clients (2 people from each firm) were in the room who are actually Pricing on Purpose. No timesheets are used inside their firms. Thus, the attendees had the opportunity to hear, first-hand, what it is like.
I’ve always said…. imagine the top quality, young talent your firm could attract if they didn’t have to track and submit their time every day.