It's true, we expect we need to know how it is that our buyers are making decisions. In particular, how is it that they use price in that decision process? Certainly, there are irrational behavioral economics-type issues, and we want to understand those. But what we truly need to understand as a company, the thing we don't understand is value. What are the decisions our buyers are making? "Understanding your customers decisions is fundamental to value based pricing."- Mark Stiving In terms of is it worth it? Am I getting enough value for the money that I'm paying? And in particular, the two decisions that seem to drive this the most? First decision is “Will I will I buy something in the product category?” And there we're asking ourselves, “Is the price low enough that when the customer solves the problem, they're happy paying that price to solve the overall problem?” The second decision they make is which one, which product will I buy? Which competitive alternative will I buy? In this case, we need to make sure that our price relative to the quality and capabilities of our products is attractive to our buyers, relative to our competitors, quality capabilities and price.
We need to understand what are those decisions our buyers are making? How do they use price and making those decisions so that we can do a much better job at pricing our product and by the week creating and communicating about our product as well. We hope you enjoyed this podcast. If you see have any questions or feedback please email me [email protected]. Now go make an impact. Connect with Mark Stiving: