Situation: A company targets mid-sized clients with pricing that is similar to its competitors. They believe that their principal differentiation is their relationship with their clients. The problem is that this is also what all of their competitors claim. They are considering testing a new pricing concept – a monthly fixed fee that will provide a pre-negotiated set of services at a favorable discount, with a weekly presence in their clients’ offices. How to you test a new service delivery model?
Advice from the CEOs:
- This looks like an appealing concept. With this arrangement there is no clock ticking and the client may view your various services as a more open menu of options available to them.
- Another company has a similar relationship with their CPA firm and have both enjoyed this and are using more services from this firm.
- Just a regular presence in the office is worth the retainer.
- Another appeal is that this allows regular participation in management and Board meetings.
- Another CEO offers a similar program for her professional service company’s clients and have found it successful.
- Since there appears to be strong support for this model within the group, what is the best way to implement this new offer?
- Negotiate an initial monthly rate for a set level of services as a retainer without a clock.
- Agree to a periodic review and adjustment of services and pricing – perhaps quarterly – based on the time and services that have been provided during the preceding period.
- How do you sell this program to those within your own company who are skeptical?
- Try the program with three clients on a limited trial basis and measure it.