Holden Advisors Blog

In recent years, the word value has become almost meaningless. This watered-down version of value frustrates anyone striving to improve sales effectiveness and overall business results. We know customers want value. But, what does that mean exactly?

As I went to pick up my morning coffee this week, I saw a sign that made me chuckle. In the window of a Dollar Store was an advertisement for steak – a full steak for only a dollar! Would you buy steak for a buck? Would you go for all-you-can-eat sushi for the low price of $10? Any takers? No one?

All pricers think there can be improvements in getting the right price. Recently, I experienced a situation with the right pricing, product, and negotiating strategy. The story starts with my wireless provider. I had issues of dropped calls and, in frustration, I called their customer service. The agent told me that there was a scheduled maintenance going on at the cell tower which would make my experience better in the future. They apologized for the issue and told me that it would be fixed within 24 hours. Having done this a couple of times, I was trained to know that this could get me a price discount. So, I told the agent that I would be leaving their service. As soon as the agent heard that, he transferred my call to the Save Team. I knew I had them now. The Save Team would offer me great discounts not to discontinue the service.

I love Thanksgiving. We get to focus on eating food (my favorite), watching football, spending time with family and friends, but most importantly, we all get to reflect on what we have to be thankful for this year. Family, friends, and health usually top the list and this year is no different.

Over the past year, I have noticed an increase in "scorched earth" negotiating tactics. These are tactics which move beyond "going kamikaze" that I talk about in Negotiating with Backbone. This new tactic indicates that the other party is going to angrily walk away from the deal and hurt each of the parties in doing so. Here's what I have learned: so far in every case, while it is an escalation of normal poker playing, it is still just a tactic to get a discount.

Do you deliver value that is not captured in price? Do you provide services that are under-appreciated by your customers? If you answered “yes,” you have lots of good company. We constantly see organizations miss the potential to capture value because of misaligned price metrics, offering extra services above and beyond contract agreements, all you can eat offerings, and poor tracking of value delivered.

Automakers are very happy with their September results as sales hit their briskest monthly pace in a year.¹ Along with higher fleet sales and replacements for vehicles damaged by recent hurricanes, Labor Day discounts are touted as a reason for celebration. According to the WSJ, average incentives in September are now $4,048, up 5% from March of this year.

We've had a lot of discussions on leadership lately. They tend to focus on people not characteristics. You know the drill, this person is a great leader and this one isn't.

Does your sales team spend more time negotiating with you than with the customer? Do they struggle to achieve pricing targets? How well-equipped are they to accomplish the objectives they are given?

Last week, Netflix announced a $1-$2 monthly price increase for its standard and premium plans. Investors applauded the move, with shares lifting 5.4%[1] on October 6^th, adding over $4B to Netflix’ market cap. How many other executives are now evaluating their pricing decisions in search of incremental revenue? Should you?