Tag Archives: Value

How Do You Reset Pricing When The Game Changes? Five Parameters

Situation: The Company sells customized products and pricing has been per product/per customer. A large client has proposed to purchase product rights across a number of products and uses. The technology is early in its expected 5-year life span. How should the Company set pricing to this customer?

Advice from the CEOs:

  • Start with a series of questions:
    • What is the value of your technology to the customer?
    • How much competition do you face?
    • What other solutions are available to the customer?
  • Based on this framework, ask contacts within the customer company open-ended questions that will reveal what is important to them including:
    • Licensing objectives,
    • Planned use of the technology, and
    • Any protections that they seek.
    • You need to understand these before you can make decisions on pricing.
  • There are several pricing scenarios:
    • Set up a scale with a declining pricing driven by volume.
    • A large lump sum payment now, non-transferable if the customer is acquired by another company.
    • A large annual fee to cover a preset number of uses and volumes, with small increments for additional purchases.
    • The final arrangement will depend on the priorities of the customer.
  • Find out what the customer is willing to pay, but you set the terms.
  • Ask what guarantees they desire to protect their position. This includes:
    • The customer’s key risk factors.
    • Whether they want exclusive or usage rights. Exclusive is worth more.

Key Words: Pricing, Custom, Technology, Life-span, Value, Competition, Licensing, Objectives, Protection, Scenario, Scale, Lump-sum, Annual Fee, Guarantee, Exclusive, Usage  [like]

Can You Increase Value in Social Network Discussions? Four Thoughts

Interview with Kenneth Vogt, CEO, Crooner Labs, Inc.

Situation: Individuals participate in social networking sites for several reasons – to network, to promote their businesses, products or services, and to gain insight through crowd sourcing. For these audiences, what are the best ways to increase the value in your discussions?

Advice:

  • Encourage participants to move from a short-term to a medium-term focus. Short term focus is about lead generation, immediate results and “Buy, Buy, Buy Now.” Think of the man in the flashy sports coat selling cars on late night television. It may generate a “sale” but with low engagement and commitment. If focus you instead on engagement, you start to build growth which is more sustainable – which will stay alive with more momentum.
  • Clarify your objectives. Are you interested in sales or influence today, or this quarter? How much effort do you want to put into it and what payback do you seek?
  • Be patient. Take the time to develop quality content. This time is an investment which pays back both medium and long-term.
  • Stop treating people as though they are stupid and can be manipulated into buying from you. There is a karmic cost to this approach. Look instead at the potential benefit that you can provide that will attract people to your content. Think in terms of reciprocity – give first and let others decide how they will respond.
  • Some time ago I tried an experiment. I proposed a simple question: “What do you want?” I asked the question three times, each time with a different thought in mind – first annoyance, then confusion, and finally empathy. But rather than speak the questions, I sent them via instant message one after the other. The words on the page were exactly the same each time, “What do you want?” Yet without tone of voice, expression or body language, the receivers could instantly tell me what I was thinking in each case. The same works in social networking. People can read where you are coming from based on how you position your content. So if you want to increase the value of what you have to say or offer, offer it openly and invite your audience to respond.

You can contact Kenneth Vogt at kvogt@croonerlabs.com

Key Words: Social Network, Discussion, Focus, Objectives, Value  [like]