Transcript
5 September 2012Advanced pricing mentoring group
Knowledge Effectiveness Frequency of use TOTAL
Value drivers
Pricing
Demonstrating value
Pricing effectiveness quotient
Knowledge Effectiveness Frequency of use TOTAL
Value drivers 7 5 5 17.5%
Pricing
Demonstrating value
Pricing effectiveness quotient
About the day
9.30 Introduction
10.50 Coffee/tea break
12.40 Lunch
2.50 Coffee/tea break
4.30 Close
Last time
Ideal client profile
Little things
Your practice as a “club”
What do we measure
£3.50
£3.54
£7.80
£7.88
£0.95
£0.96
A thought
Tax saving = £50,000
Success = 90% +
Hours = 10
Fee = £12,500
Rate = £1,250 ph
Fee = 25%
Value?
Tangible versus intangible benefits,i.e. solutions vs experience
Perceived value = f ( Perceived benefits
Perceived price)
Gianni
Franco
QuestionsQ
10%
=
Answers
Questions
300%
Key learning points
1.2.3.
Putting it into practice
Tangible versus intangible benefits,i.e. solutions vs experience
Perceived value = f ( Perceived benefits
Perceived price)
Mortgage references
Mortgage references
How to price
How to add value
How to explain
Putting it into practice(again)
Menu pricing (top down pricing) Options Language How to price (link price to value) Add tangible value Add intangible value Benefits Unique selling points Presentation Guarantees Service standards Payment terms
I enclose a cheque for £ ________ (inc. VAT) made payable to Bloggins & Co]
I wish to pay £ ________ by: Visa q Mastercard q
Card No: Security No:
Start date: / Expiry date: /
Cardholder’s name:
Cardholder’s address:
Signature:
insert practice name
Key learning points
1.2.3.
The biggest research studyin the world
Behavioural economics
Loss aversion
Social proofInertiaAccommodation
“Do defaults save lives?” Eric J Johnson & Daniel
Goldstein
“Total Accounting Solution”
Step 1There is always a default…
So make it the outcome you want
Choicearchitecture
Behavioural economics Loss aversion – we hate the idea of missing out
Social proof – we like to do what others do
Inertia – we go with the status quo
Accommodation – we quickly get used to new
status quo
Step 2
Offer it to everybody as the default “Our standard service is what we call the Total Accounting
Solution”
Carefully designed script to explain they can opt out
“Most businesses like yours go for of our Total Accounting Solution because it gives them everything they need to earn more money with less effort, and also pay less tax. But if you don’t think it’s the best solution for you, you can always downgrade by taking out parts of the package.”
Step 3
Carefully designed script if they want to opt out
“If you take that out of the package the price comes down by £300, but just to be clear, you then won’t get to see how well your competitors are doing, and you won’t get a profit improvement action plan based on those findings, so you may miss out on extra profits as a result.”
Step 4
Do it in person – not by post
Do it with every prospect
And do it with every client…
… every year until they choose the default
… and it becomes the new status quo
And…
Key learning points
1.2.3.
Most firms with the highest average fees do it
Design a big package
Offer it as default – “this is how we do business”
Opt out, rather than opt in
Key learning
Stretch your thinking!
Ryan Deiss
Conversions Revenue
$197 340 $66,980
Conversions Revenue
$197 340 $66,980
2 x $97 977 $189.538
Conversions Revenue
$197 340 $66,980
2 x $97 977 $189.538
3 x $97 1008 $293,328
4.46 x increase
People focus on the $97 not the $291
Key learning points
1.2.3.
Your feedback, and…Your key actions
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