Adding ValueCreative approaches to Pricing and Positioning

Dave Gillis ⊕ Ben Weeks

Pricing is scary

Pricing is a process

1. Positioning2. Qualification & Diagnosis3. Negotiation

1. Positioning

How many known, suitable alternatives are there?

Pricin

g Pow

er

Reputation

Spe

cial

izat

ion

Tune in.What are you interested in?

What are you good at that is valuable to others?

In your arena, who are your competitors?

How many known, alternative competitors are there?

Where does your target audience hang out?

Go and experience, observe, listen to them,

doing so builds awareness both ways.

(Where are their pain points? Competition etc?

What do they think and feel about you?)

What would you like them to feel and think?

Reputation (You can never have enough.)

Thinking Behaviour Performance

Experts write.

Thinking

~ Blair Enns

Engage with your audience.

Behaviour

You get more of the kind of work you do.

Performance

Pricin

g Pow

er

Reputation

Spe

cial

izat

ion

Quali!cation & Diagnosis

Minimum Level of Engagement

Is there an allocated budget?”

Do you have a sense of how much you will need to invest to accomplish this?”

Why are you going to market now?”

“

“

“

Don’t take self-diagnosis at face value.

Known Solution

Unknown Solution

Known Problem

Unknown Problem

N/A

Address known issues

Unlock new opportunities

Execute roadmap

Light-weight diagnostic tools

• Pilot Project

• Client Questionnaire

• Discovery Session

• Moodboards

• Street Interview Video

Value-based pricing...

Value is created outside of your business.

Are you being hired to be ef!cient or effective?

~ Tim Williams

Look for leading indicators of success.

Scope of work

Scope of value:“I will work with client to deliver the following outcomes...”

Factors to consider when setting a value-based price• Where am I delivering on the customer’s value chain?

• How important is this to the strategic objectives of the customer?

• What is the financial impact of the desired outcomes?

• What is the client’s cost of not solving this problem?

• How time-sensitive is this assignment?

• How sophisticated is the client?

• To what degree am I uniquely qualified for this assignment?

Types of Value-PricingType Purpose Form

Tiered-based Dimensionalize value Multiple fixed-bids

Commitment-basedDefine engagement

timeline + minimum acceptable solution

Single fixed-bid

Usage-based Prescribe application License agreement

Performance-based Align incentivesBase fee + value

reserve tied to KPI

Partnership Align incentives Base fee + equity

... ... ...

Negotiation

The polite battle for control

• Assume the role of the respectful facilitator

• Your job is not to convince but to affirm and assert.

• Discuss to build an honest assessment of fit.

• Be willing to part ways, it's all about fit.

~ Blair Enns

The polite battle for control

• When it comes to money, shift gears from being inspiring, slow down.

• Discounts: Don’t. If you must, leave it till the end, put it in writing.

• Proposals are: "The words coming out of my mouth."

• "I'd be happy to write up a contract for your signature

• if you're telling me you'd like to hire us."

~ Blair Enns

In conclusion...

Quick recap

• Pricing is a process that involves positioning, qualification and diagnosis, and negotiation

• Positioning is where your pricing power comes from. Think: specialization and reputation.

• Use an minimum level of engagement to qualify by price as early as appropriate.

• Don’t accept clients’ self-diagnosis.

• Look for creative ways to price your work based on its value.

• Negotiate by taking on the role of the respectful facilitator.

Thank you!

@ben_weekswww.benweeks.ca

@davegilliswww.teehanlax.com