When making critical decisions related to pricing and go-to-market strategies, better information leads to better outcomes. Internal perspectives on business situations are an essential component, but there is a host of rich insight to be had from other perspectives that affect a business. Considering each of these can make significant differences in both the confidence in the strategic decisions, as well as the opportunities revealed.
When we work with clients who are facing a decision, we often see that internal parties have been debating perspectives for some time, with either limited use of data, partial data, or mostly internal data. We find that these same decisions makers can move more quickly toward a good decision by using a strong framing of the problem and additional perspective analysis from sources outside the company.
To get to a holistic view of a situation, using a variety of relevant sources is the key, but it’s not easy to do. Below we will address only four sources that are used, among several others, including sales data, expert interviews, industry data, and surveys. Rather than just talk about the information, we have included a mini case study with each, where that data source shifted the thinking and enabled better decision making.
Every company has sales data but looking at it in unique ways and leveraging proprietary tools extracts far more actionable insights. This analysis identifies areas of existing strength and a host of specific opportunities to be addressed.
Situation: A company executed pricing moves but did not take into consideration things like product tiers, elasticity, and customer priority. This resulted in push back from large customers, reduction in realized price increase, and opportunities untouched.
Case study: After analyzing invoice data, specific areas of improvement were targeted for the next pricing move. This allowed for a sustainable price increase process to be created, greater clarity of rationale for customer/product price changes, and the ability to monitor price changes and opportunities ongoing.
Industry experts are a valuable resource to learn more about companies, trends, where the market is moving, what it takes to win, and other important perspectives. They can answer questions you have and reveal information that is not available on the internet or within industry data.
Situation: A well-established company has been expanding its offerings into a new segment of the market but hasn’t been able to close many deals due to differing requirements of the segment.
Case study: By sourcing and vetting relevant experts across several hours of interviews, the keys to competing in the new segment were identified. Extensive detail on how other companies had entered the space, their offerings, sales, marketing, training, and other valuable items were obtained that flowed into a clear go-to-market approach.
This source gives you insights into current trends in the industry, comparable metrics and averages, and wide-ranging forecasts. This data can be a great place to start an analysis to figure out where you want to go into greater depth.
Situation: A company had increased pricing due to input cost inflation and was concerned about losing volume in relation to competition. They thought they had gone above the rest of the industry’s price moves.
Case study: Relevant benchmarks indicated the company was actually well below the average in the last year. In fact, it was below all similar product categories in terms of realized price increases. This, along with willingness-to-pay data, gave renewed confidence in a price increase plan that was then developed in detail.
We’ve all taken surveys and have seen survey data. However, for pricing and sales related topics, there are advanced methods to identify preferences and willingness to pay that go beyond simplistic approaches. This allows for quantitative data on specific products, features, and price points. Understanding price effects and scenario model can be powerful to inform decision making.
Situation: A company was looking to take pricing action but didn’t know their pricing power in relation to competitors.
Case Study: Running a B2B survey with decision makers using a purchase simulation method (conjoint analysis) revealed the company’s products were underpriced compared to the competition and the customers’ willingness to pay. The company’s brand was seen as high quality and there was a higher level of willingness to pay that allowed for a multifaceted marketing and pricing strategy to be developed with confidence.
All of these sources of data can be incredibly useful, depending on the situation and a company’s needs. These data can reveal valuable insights that can lead to sales and profit growth and help you deliver against your goals.
Contact our team at Maple Street if you’d like to learn more.