New Online Pricing Courses Continue the Path to Pricing Excellence - By Fabricio J. Lopez

Our members tell us they love the ongoing benefit of the PPS Online Pricing Courses. Continuing in this endeavor, the Professional Pricing Society is now offering nine new online courses, growing the breadth and depth of pricing training offerings. 

The pricing courses are led by best-in-class pricing experts and cover all the bases, from customer behavior to leadership and change. Many of the instructors are also regular speakers at our conferences. PPS members have full online access to each course’s expert instructor and these nine new courses continue our commitment to offering the best in online pricing coursework.

The quantitative: Courses on quantitative pricing practices and value-based pricing include online pricing topics such as, “Quantitative Pricing Research: Framework and Methodologies” taught by Walter Paczkowski, Ph.D.; “Quantifying and Documenting Value in Business Markets” with Andreas Hinterhuber, Ph.D., and SKF, global manager, Todd Snelgrove; and Stephan Liozu, Ph.D., explores “Value-based Pricing & Value Modeling: Theoretical & Practical Perspectives.”

The type of learning you’ll find in this group is both broad and deep. For example, Dr. Paczkowski teaches the specifics of quantitative pricing research and states, “We can’t jump into a pricing study without a framework for conducting the study. Much teaching focuses on techniques; but how to apply the techniques, which one and when, is often ignored. There should be a methodological framework for techniques used in quantitative pricing research.”

Another example is how Dr. Liozu adds the organizational perspective to his quantitative coursework. He states about his value-modeling course, “We will look at both theoretical and practical perspectives. With twenty years of experience as a top executive I have insight worked within a global organization to have the right pricing orientation in the firm. To do so we take a deep dive into the process of value-modeling using economic value estimation method looking at value from a very practical level in terms of key success factors.”

Customer behavior: This ‘human-element’ grouping is another import area touched upon in another series of coursework. Trainings include: “Influencing Customer Price Acceptance” from Tim J. Smith Ph.D.; “Psychological Aspects of Pricing” from the team of doctorates, Andreas Hinterhuber and Stephan Liozu; as well as “The 5C Model of Pricing Transformation” from Dr. Liozu.

Dr. Smith says about the study of risk and probabilities in his course, “Prospect theory has been around for thirty years and is only just now making the trade press. Prospect theory accurately predicts the challenges customers have in making rational tradeoffs between products and value. There are many implications of prospect theory that define customer behavior today that are vital to influencing customer price acceptance.” 

Leadership and change: Another important area of expertise focuses on best practices in pricing around innovation leadership and change management.  PPS Online Pricing Courses include a couple of evocative sessions from the inexhaustible, Dr. Stephan Liozu. His contributions to the new coursework in this area include “Pricing, Value & Innovation” and “Pricing and the C-Suite.” Additionally, leading retail pricing truths are brought forth where the rubber hits the road in the retail area. “Achieving Pricing and Profitability Excellence in Retail” is taught by a team of experienced pricing professionals from Deloitte, led by Retail Practice Principal, Chris Goodin.

For his online course on “Pricing, Value & Innovation,” Stephan Liozu had this to say: “We will explore when there is a reference value and deliver a unified approach the reference; and when there is no reference value in the case of radical innovation.”

To this Liozu adds, “Radical innovation brings unique perspective on the combination of innovation, value and pricing. These three elements have to be looked at separately and in common; and we will look at many exciting example scenarios in the course.”

PPS Online Pricing Courses opportunity: Whether you are part of a large organization looking to train a dispersed workforce or managing an onsite pricing department, or especially those seeking to hone their individual pricing skills, these online training courses will fit your needs.

With our entire library, now counting 26 online pricing courses, participants always say they enjoy learning at their own pace and finding the pricing course most topical to their particular business goals. In this way, ‘priceless” knowledge is being delivered just in time to be actively utilized in a way that best fits each pricer’s needs.

If you would like keep up on our entire line up of online pricing courses please visit: www.pricingsociety.com/trainingcourses

Day 4 Recap: Spring Pricing Conference in San Francisco

San Francisco, CA, Friday, May 3nd, 2013

Day 4: 18 Conference Breakout sessions 

Our 18 conference breakout sessions today allowed attendees to hone their pricing skills and learn new tools and techniques. We also explored how the Internet is changing the pricing industry and how pricers can leverage big data to enhance pricing initiatives.

Graeme Ingham VP of Price Management for Schneider Electric described the amazing journey taken by the corporation since the economic crisis in 2009 and how they reacted quickly, implemented a well-orchestrated global pricing initiative, got buy-in and full support from top executives and the CEO declared PRICING the Number 1 priority during 2012. Graeme shared the outstanding process and incredible pay off. 

Finn Hansen, CEO of Stratinis, shared how to gather and use large data sets with minimum effort in his session on “Pricing and Big Data,” and Jean-Manuel Izaret, partner at the Boston Consulting Group, offered tips on how to transform technology into an asset for pricing solutions.

Other highlights from the breakout sessions include learning the best practices to tackle the pricing challenges of emerging markets, how to use training programs to encourage evaluation of pricing strategies, and the common pricing principles that transcend different industries. 

We close this conference with the satisfaction of job well done, attendees are eager to get back to work and put in practice what they learned.

We sincerely thank all and each one of our members, sponsors, speakers and staff. Safe travels home and we will see you soon!

Happy Pricing!

Day 3 Recap: Spring Pricing Conference in San Francisco

San Francisco, CA, Thursday, May 2nd, 2013
Day 3 Recap: Keynotes

We were lucky to hear from six industry leading lights during our keynote sessions. Among the speakers was Dr. Georg Tacke, CEO of Simon-Kucher & Partners, discussing pricing and commercial excellence and Caspar de Bono, managing director B2B of the Financial Times Ltd., who addressed how to price digital products in a weightless word.

During lunch, we had the opportunity to network with global pricing professionals and what has become a tradition in PPS Conferences, The Women in Pricing Luncheon sponsored by Simon-Kucher & Partners. The luncheon serves as an opportunity to discuss the trends that influence the job and important contributions of the ever-growing presence of women in the field of pricing.

Paul Hunt, President of Pricing Solutions; got our attention as he described the inner parts and key aspects of The Journey to World Class Pricing.

Larry Montan from Deloitte Consulting presented The White Elephant in the Room: Sales Compensation, a fascinating session where he shared his experiences and lessons learned in how to get sales compensation aligned with pricing.

Speaking in Tongues was the title for the keynote presented by Steve Haggett, Past Senior Director of Pricing for Philips Healthcare, Steve described how to drive profit performance by getting better at speaking the multiple languages of corporate functions such as finance, marketing, HR, Sales and Product Management.

Ending day three, we heard from Robert D. Smith, director of corporate pricing at Eastman Chemical Company, who covered the key areas of focus for developing a sustainable pricing culture. After Robert’s keynote, we headed over to PROS’ conference reception for some fun and more networking opportunities. Attendees enjoyed great food and drinks, won some prizes and walked out with unique caricature portraits drawn by an artist in the Sponsors Hall.

Day 2 Recap: Spring Pricing Conference in San Francisco

San Francisco, CA, Wednesday, May 1st, 2013

Day 2 Highlights – Seven Workshops & a Celebratory Reception with PricewaterhouseCoopers

It was another exciting day of pricing workshops in San Francisco. The two 2-day workshops concluded successfully and we heard from the managing principal and a senior pricing analyst at Wiglaf Pricing on how to design game theory applications to better recognize competitive pricing pressures. They shared case studies and offered practical, easy-to-use tips on how to model pricing scenarios according to market environment.

Stephan Liozu, Ph.D. and pricing evangelist addressed the need for more innovation and creativity in pricing models. He shared his unique view of the integration of value and pricing in the innovation process and gave us specific examples of how this integration happens. 

Nelson Hyde from Holden Advisors presented Negotiating with Backbone, quite an interactive session with lots of questions and practical tips on how to identify the type of players and how to effectively negotiate with them.

Eugene F. Zelek, Jr. shared his legal expertise in the pricing field giving many tips to improve pricing effectiveness and stay within the legal boundaries.

Another compelling session was The Art of Psychological Pricing: Applying Behavioral Economics in B2B and B2C Pricing with Florian Bauer, Ph.D., lots of happy attendees came out with a new understanding of pricing beyond the numbers.

Jim Geisman show participants hot to Monetize Software IP and the excellent duo Rich Eagles and Joe Morris presented Integrated Pricing and Profitability Management covering both sides of the table, the consulting side (Morris with Deloitte) and the client side (Eagles with DuPont).

And to wrap up day two, we attended a great workshop reception sponsored by PricewaterhouseCoopers, The Press Club San Francisco served as the venue where we enjoyed the many good wines from this part of the world, of course good conversation and networking with old and new friends in pricing was the most important part of the evening.

Day 1 Recap: Spring Pricing Conference in San Francisco

San Francisco, CA, Tuesday, April 30^h, 2013

Day one: First day of conference, Pricing Training Workshops

Day 1 Recap: Spring Pricing Conference in San Francisco

Our Annual Spring Pricing Workshop & Conference in San Francisco have started and everyone here is eager to learn and apply best practices to achieve pricing excellence.

After the workshops, we are all thrilled about the glorious warm weather and how enjoyable is everything from just walking around this beautiful city to sitting down and enjoying dinner at superb areas like Pier 39 among many others.

With hands-on workshops and high-level speakers from the worlds of business, technology and academia, day 1 built a diverse foundation of pricing professionalism, networking and training.

Yesterday, we kicked off two 2-day workshops and three 1-day workshops, learning about Core Pricing Skills, successful price innovations in the medical device arena, the best practices in strategic pricing process design and the seven types of customer risk and their impact on value.

Today we are going through seven more workshops and looking forward to a Post Workshop reception sponsored by PricewaterhouseCoopers to celebrate our new pricing skills and relax after 2 days of intense pricing training.

 

Professional Pricing Society Explores New Role of Pricers as Change Agents and Leaders at 24th Annual Spring Conference

San Francisco Workshops Highlight Change Management Trends and How to Best Leverage Technology to Achieve Pricing Excellence 

 

The Professional Pricing Society (Pricing Society), supporting pricing education and training in 75 countries, is hosting its 24th Annual Spring Pricing Workshops & Conference from April 30, 2013 to May 3, 2013 in San Francisco at The Palace Hotel. The conference features hands-on workshops and high-level speakers from the words of business, technology and academia, building a diverse environment of pricing professionalism, networking and training.

The most comprehensive pricing training conference to-date, Pricing Society offers 36 sessions and workshops and more than 96 hours of pricing training. Important themes at this year’s conference are change management via market-changing technologies, pricing in global competition and pricing leadership; as well as exploring the components of pricing change that boost bottom lines and drive transformation.

“In a constantly changing world, pricers must learn new processes and strategies to shape and improve innovation strategies,” said Kevin Mitchell, president of the Pricing Society. “Pricers are having more input in multiple levels of the organization, transforming their traditional role into change agents and leaders. We have invited national and international pricing experts to share their experience spearheading effective change and to imbue pricers with the skills they need to succeed, like how to work with capable champions and within a culture of competitive accountability.”

The conference will feature six keynote presentations from industry leading lights. Speaking talent includes Dr. Georg Tacke, CEO, Simon-Kucher & Partners, Caspar de Bono, managing director B2B, Financial Times Ltd and Robert D. Smith, director of corporate pricing, Eastman Chemical Company.

On day three, May 2nd, Dr. Georg Tacke will present, “Pricing and Commercial Excellence – How to Make It Happen,” discussing the reasons of a poor pricing performance and how to transform an organization into a pricing champion. Dr. Tacke has more than 20 years of pricing consulting experience and specializes in developing business, marketing and pricing strategies for companies in the service and automotive industries.

Next we will hear from Caspar de De Bono. His keynote, “Making the Invisible Visible,” explores the necessity of a direct customer relationship in pricing decisions and addresses how to price digital products in a weightless world. De Bono joined the Financial Times in 1995 and has served in a variety of roles including product development, marketing, strategy and publishing.

And ending day three, Robert D. Smith will cover “Sustainability in Pricing,” enlightening attendees with the key areas of focus for developing a sustainable pricing culture and integrating acquisitions with varying pricing philosophies. Over the past twelve years, Smith’s work with Eastman has focused on margin management and developing and sustaining pricing capabilities.

Additionally attendees will hear from Paul Hunt, president of Pricing Solutions Ltd., with “The Journey to Word Class Pricing,” Larry Montan, director of pricing and profitability management practice for Deloitte Consulting, discussing “The White Elephant in the Room: Sales Compensation,” and Steve Haggett, former senior director of pricing for Philips Healthcare, presenting “Speaking in Tongues.”

These six expert keynotes headline what will be an active 24th Annual Pricing Workshops & Conference. Attendees will grow vital pricing skills in 2 two-day workshops and 7 one-day workshops, as well as 18 sessions populating three interest-specific breakout tracks – Pricing Practitioners Pricing Experts, and Tools and Techniques.

For complete information on the Annual Spring Pricing Conference in San Francisco, or for research and resources related to the profession of pricing, visit the Professional Pricing Society at http://www.pricingsociety.com.

About the Pricing Society 

The Professional Pricing Society is the largest professional society dedicated solely to pricing training and education. Its mission is to advance the creation, communication and application of pricing knowledge throughout the world. The Professional Pricing Society provides pricing professionals with current strategies, market trends, analysis, research and resources from today's leading pricing experts and technology. For more information on membership or events visit the organization’s website at http://www.pricingsociety.com.

 

Harnessing Big Data for the Service Parts Industry

Even in a tough economy, organisations still face the same challenge each year: hitting bigger quotas.

For service parts manufacturers and distributors dealing with multiple channels, thousands of customers and millions of products, achieving sales growth can be like finding that proverbial needle in the haystack.

Then there are additional forces to contend with, such as fending off aggressive competitors, negotiating with sophisticated procurement departments, managing rebates and discounts, and keeping up with raw material cost changes.

This complexity keeps company leaders up at night, wondering where next year’s sales growth is going to come from. Many high-performing service parts organisations are realising that the answers aren’t found with simple rule-of-thumb pricing or gut instinct.
The answers lie in effectively using the swathes of big data that these companies already have.

Cutting Through Complexity

Big data solutions unlock the insights buried within operational and transactional data so that companies can improve win rates, leave less money on the table and create more effective selling capacity.
Service parts companies typically possess plenty of data from multiple sources that can be used to see where and why sales prices are achieved and deals won:

• Products- cost, monthly volumes, product hierarchy, lifecycle stage
• Customers- geography, size, industry
• Transactions, invoices and rebates- date, price, cost, discount, salesperson, quantity, unit of measure
• Social Selling- influential decision-makers, referrals, partners, associations

By mining this torrent of digital data with automated sales effectiveness solutions, companies are able to understand their customers’ buying patterns based on real-time data science and analytics.

Syncing Pricing With Sales

This intelligence can be passed in real time to sales teams where they can access critical information and use it as part of their work with customers.
Areas where this information can be called upon include active sales leads, pending work items, email, alerts, price approvals, work documents and the customer relationship management pipeline;all delivered in familiar user interfaces that have been tailored to specific business roles.

For example, to coach their teams and drive performance, sales executives can access charts to reign in over-discounting and identify underperforming accounts. They can quickly drill down into transaction data by customer, product or sales region to identify hidden sales opportunities ranked by the greatest potential impact on their business strategies.

Meanwhile, salespeople can initiate price and quote requests, and receive scientifically generated price recommendations with suggested cross-sell and up-sell recommendations based on what similar customers are buying.

What’s more, since the process can be automated, they no longer have to juggle multiple spreadsheets or worry whether they have the most updated prices.

One of the big benefits of using big data is to link different groups within organisations such as pricing and sales. Let’s face it: internal teams often operate in their own silos. For example, consider a pricing manager who sets a strategy to improve margins by 15 percent on a particular product category, only to have a salesperson use rebates or discounts to unknowingly erase all of the gain.

Driving Results

Many companies want to turn their data into something actionable – whether it’s identifying market opportunities, understanding the true impact of promotions and concessions, or targeting prices, volume and product mix – so  their sales teams can better serve their customers at the point of negotiations.

By leveraging the power of informed pricing, coupled with familiar and easy-to-use tools, sales teams are able to drive improved financial performance and more fully realise their company’s market potential.

By: Sean Duclaux
Service Parts Industry Marketing Manager, PROS.

Consider attending PROS Outperform 2013 The Big Data Event for Sales and  Pricing.

For more information go to: http://www.outperform2013.com 

The Least Understood Pricing Parameter Among Business People!

An uncertain global economy, ever-increasing competition and relentless demands from traditional and new channel partners have placed more pressure on pricing well. Fortunately, changes in the law of pricing—particularly in the United States and Canada—have resulted a great deal of freedom that effectively narrows or eliminates formerly convenient legal rules of thumb.



Eugene F. Zelek, Jr.Partner and Co-Chair,
Antitrust & Trade Regulation Group,
Freeborn & Peters LLP

"Legal issues are probably the least understood pricing parameter among business people," but often significantly affect pricing strategy and its implementation. Indeed, lingering misperceptions may block the use of powerful tools that help achieve improved pricing performance.

During the next PPS Spring Pricing Conference in San Francisco you will have a great opportunity to learn how the considerable flexibility in the law and the cutting-edge legal tools that go with it can be applied to achieve pricing excellence in three key areas of growing current interest: (1) embracing value pricing to maximize return, (2) combating resale price erosion over the Internet or elsewhere and (3) engaging in effective price signaling to avoid lowest-common-denominator pricing,

The following topics, among others, will be addressed:

• Reaping the Rewards of Value Management
• Paying for Value: Account-Specific and Channel-Specific Pricing
• Addressing Internet Price Problems
• Lawfully Setting and Enforcing Resale Prices
• Controlling Distribution: Effective Non-Price Restrictions
• Price Signaling: Using Controlled Transparency

Learn how to take the legal fear out of being assertive; Why the law is not a roadblock to smart pricing;  The relevant standards, what they really mean and their implications for pricers; And, practical approaches that can be readily implemented.

 

Eugene F. Zelek, Jr. focuses on marketing-related law, applying extensive counseling, transactional, and litigation expertise on behalf of leading consumer and industrial businesses and consulting firms throughout the world. His areas of emphasis include antitrust, pricing, and distribution, as well as branding, licensing, entertainment, strategic alliances, supply relationships, complex contracts, advertising, and new product development.

Mr. Zelek joined Freeborn & Peters LLP after practicing marketing law at a large international law firm and The Quaker Oats Company, then becoming a Quaker Product Manager with shared responsibility for Quaker’s Cap’n Crunch cereal and Chewy granola bars. He is a partner in the firm’s Business Law Services and Litigation Practice Groups and co-chairs the Antitrust and Trade Regulation Practice Group.

After receiving an undergraduate degree in journalism with high honors from the University of Illinois, Mr. Zelek graduated cum laude from the Northwestern University School of Law and, as a marketing major, with Distinction from the Kellogg School of Management. While at Northwestern, he was an Executive Editor of its law review and a Distinguished Scholar. Subsequently, Mr. Zelek has served as a member of the Kellogg marketing faculty, teaching “The Legal Aspects of Marketing Strategy” and executive programs on pricing and channel management.

Do you have a pricing problem?

Guest post by Stephan Liozu

For the past few months, and since leaving the corporate world, I have had the privilege to work with a few companies as a consultant, as a speaker or as a trainer. Many companies called me initially to discuss their “pricing problems”. It seemed that the focus had switched to pricing when in fact they had not done a proper diagnostic of their internal gaps. The reality of their situation was that they did have a pricing problem. Because pricing excellence is a journey and not a destination, every organization might be faced with pricing problems of different nature and different intensity.

But the reality also was that, for these companies, the pricing problems were a symptom of a greater internal problem. So trying to resolve their pricing problems might yield some positive short term developments but might not solve their internal structural issues.

In the figure above, I list of few of these structural business problems. I will only focus on three critical ones:

1. Segmentation: Perhaps the most common marketing problem is a total lack of segmentation based on user needs. Without segmentation, these firms cannot separate various types of buyers and they try to be everything for everyone. The end results of this problem is customers’ confusion with pricing, severe pricing overlap across segments, and profit leakages when customers get things they do not value and are not willing to pay for. Segmentation is one of first steps of the value-based pricing methodology. It is also the fundamental step of a sound marketing strategy.
2. Business model: Another significant structural problem leading to pricing erosion is the lack of a sound and differentiated business model. I was recently in a customer’s executive suite meeting where the pricing discussion led to some serious exchanges on the organization’s business model. Let me be clear. If the business model is broken, there is a high chance that the pricing models are also broken. Therefore before working on their pricing models, business leaders should figure out what their business model is, how strong it is and what is needed to reinforce it. The same could be said about a corporate strategy that is not obsolete, internally oriented and not delivering value to customers. There is no pricing program or action that will solve this situation.
3. Strategic alignment: This structural problem occurs when teams work in silos with different goal systems, different compensation structures, and different perceptions of what the business model is. This lack of alignment generally leads to internal dysfunctionalities. The sales force for example will not deploy the marketing programs while cost accountants will focus on producing report that no one reads. Strategic alignment starts at the top. If pricing and value are priories are the top, everything cascades down the organization.

I could equally have focused on the lack of innovation, the lack of differentiation, and the lack of attention to customer value. In order for pricing programs and strategies to be successful, they have to be aligned with a sound business model and a strong corporate strategy which aim at creating and delivering customer value. Then pricing can become an effective weapon to capture that value. When the business model and the corporate strategy are broken, pricing cannot do miracles and be considered a silver bullet to save the day. So I start customer engagements by having that discussion with the top executives. Generally, it leads to excellent dialogs on business model innovation and value proposition.

Be bold. Join the pricing revolution! 

Stephan Liozu (www.stephanliozu.com) is the Founder of Value Innoruption Advisors and specializes in disruptive approaches in innovation, pricing and value management. He earned his PhD in Management from Case Western Reserve University and can be reached at sliozu@case.edu.

Pricing: Transforming Organizations and Fostering Change - By Kevin Mitchell

Rolling into 2013, as is often the case, we find ourselves thinking about important changes that have occurred throughout the year. Reflecting on the macro can widen our perspective, and as we reflect on the year we tend to reassess our personal and professional roles and roadmaps.

We recently featured the macro findings of one of our experts, the newly minted Ph.D. Stephan Liozu. Congratulations to Stephan for staying on the road to academic achievement and in doing so, expanding formal research into the role of pricers within the business organization. We all benefit when what we do is delineated, codified and quantified…

Stephan’s recent study titled “Survey on Organizational Change Capacity in Pricing” was compiled with assistance of over one thousand Pricing Society members. It reveals what many of us have witnessed but not always measured; that true pricing excellence transforms organizations.

Interestingly, the survey found that a vast majority of pricing professionals already have attended programs relating to change management. In fact, 73 percent of respondents indicated that they had already attended a dedicated formal program relating to change management at the corporate or university level.

For example, moving from a cost-basis to a value-basis is a huge shift in the DNA of the corporate structure. When total organization mobilization occurs, pricers will find the entire curriculum of their job changes with it. Pricers have to be ready to present to the entire company or C-suite, as well as collaborate more globally and persuasively on key concepts.
This engagement, while sometimes sink or swim, forces pricers to be included as leaders and change agents. When the unit of measurement is an entire organization, properly empowered pricers will deliver change by working in teams of skilled pros on revenue management, data analytics, business analysts and, yes, pricing.

Additional and counterintuitive…

It is surprising to note that the dimension of “innovation culture” was ranked by pricers in only seventh place in the “8 Dimensions of Organization Change Capacity” examined in the survey. This could indicate that change can still happen without necessarily having an innovative culture. With capable champions leading the charge, organizations can adapt and change with or without innovation leaders.

In the case of the change-educated pricing professional, this indicates that while pricing excellence doesn’t always have to include wide reaching corporate change, overall change theory is well understood and valued by a majority of pricing pros. When large-scale change is implemented, educated pricers can share the responsibility directly with company leadership to set the stage for successful implementation.

Overall, the executive summary of the report is a must-read with many interesting nuances and findings. And as we move into 2013, it gives us food for thought that can inspire us to take that high road, showing that pricers can in fact be change agents.

Good to reflect on the macro while focusing on the micro.

Kevin Mitchell
President
Professional Pricing Society

Official Program Release - PPS Spring Pricing Conference San Francisco - 2013

REGISTRATION IS OPEN!

It is our honor to officially release the program for the 24th Annual Spring Pricing Workshops & Conference to be held in San Francisco, CA from April 30th to May 3rd, 2013.





The 4-day conference program includes:

Two 2-Day Workshops
Twelve 1-Day Workshops
Post-Workshop Reception
Six Keynote Speakers
Conference Reception
Three Breakout Tracks with
Eighteen Different Sessions

 

PRICING Strategies for Today's World is happening in San Francisco

 Join us!

Amsterdam Conference Recap - Day 3

Thursday, December 6th, Day Three, Keynotes & Breakout Tracks

Our keynote speakers were the perfect way start the last of out three pricing-filled days in Amsterdam.  Our first keynote, by Dr. Georg Tacke, CEO of Simon-Kucker & Partners, shared his recommendations for future pricing strategies and identified the most important challenges in the coming years.

Dr. Tacke highlighted the facts resulting from the 2012 Global Pricing Study conducted by Simon-Kucher &Partners in cooperation with PPS. He stated “Those Companies that have a professional pricing organization do much, much better than those who don’t” This fact-based statement brings great expectations for all of us involved in pricing. There’s a lot of work to do, lots of room for improvement and the need for professional pricers continues to increase.

We also heard from Laura Preslan, general manager of strategic practices for Microsoft, who allowed us to learn from her painful mistakes by sharing her strategies that worked, and those that did not.

Dr. Frederic Jallat from ESCP Europe shared with us compelling study results that explain why online price dispersion and price instability not only persist but have even increased over time.

Miguel Serrano, Director Global Pricing Strategy for Medtronic, Inc., told everyone in the room to become a pricing evangelist, to move, flight and talk to stakeholders in every country where your company has presence at. He also told the crowd how to achieve a long-lasting cultural change [on pricing] within the organization, which guarantees both the sustainability, as well as the returns on investment from creating a Price Management / Value Selling culture and practice.

After refueling energies the afternoon was packed with 12 breakout track options, lots of activity, learning and networking among the best in pricing in Europe and the World!

We shared some fun and laughs with all our exhibiting sponsors while they handed out fun and valuable prizes to the lucky winners, many walked out with iPad Minis, 3D Cameras, Vintage Champagne, and several other great prices.

We thank all our speakers for sharing such valuable pricing strategy knowledge.

Amsterdam Conference Recap - Day 2

Wednesday, 5th December 2012,
Day Two, Pricing Workshops and 4th Annual Global Pricing for Executives Summit

Nothing makes us happier than seeing hundreds of international pricing practitioners and executives gather together and share industry knowledge and lessons learned. Our Pricing for Executives Summit was a big hit, and participants walked away with practical, easy-to-use tips to improve their pricing strategies, like:

·         How to eliminate the discounting habit in sales people

·         Why pricing is the great opportunity of the recession

·         How to gather information needed to accurately price products

Participants also shared with us that the Summit’s format makes it very dynamic and engaging with 5 different speakers and closing with a presenter’s panel where their questions were addressed with tailored answers to their specific industries.

Stephen Martin led an enlightening workshop about Channel Pricing where he addressed the methodologies, tools and key issues about this complex and ever evolving field.

Paul Hunt and Fernando Ventureira had a massive workshop titled “Building a High Impact Pricing Strategy” they also added the effects of globalization, established markets vs. emerging economies and participants arrived to helpful conclusions about creating solid and enduring pricing strategies that are effective both locally and globally.

James Brown and Hong-May Cheng finished their 2-day workshop on Core Pricing Skills; this is a staple workshop that always draws great attendance in all PPS Conferences. The world of pricing keeps growing, PPS keeps attracting those new to Pricing and Core Pricing Skills is a must for anyone getting started in this fascinating and rewarding field.

The day started with a warm and cozy breakfast at the Sponsors Hall and ended at the same place with a lively networking reception sponsored by PROS, some cocktails and good food are always a good reward after a full-day of pricing training!

Check back with us tomorrow to read about the four great keynotes and twelve breakout tracks we have lined up for the last day of our conference.

Amsterdam Conference Recap – Day 1

Tuesday, 4th December 2012, Day one, first day of Pricing Workshops

We kicked off the first day of our European Pricing Conference with four information-packed workshops led by senior pricing experts from around the world – such a terrific way to celebrate Pricing Society’s 4000th member milestone as well.

We learned 17 different economic, behavioral and psychological influences to customer price perception from Tim Smith, PhD and managing principal of Wiglaf Pricing.

The workshop conducted by Daniel Soto-Zeevaert and Frank Korf was quite revealing about the depths and importance of using good data and the right balance between facts vs. experience to produce effective pricing decisions based on more reliable pricing analytics.

Speakers from Simon-Kucher & Partners were in charge of two workshops today covering the fundamentals of pricing during a 2-day workshop and also sharing their experience about B2B pricing where attendees learned about the impact of pricing decisions in oligopolistic markets and had a chance to deal with price elasticity before experiencing it the hard way in real market scenarios.

The sessions progressed just like the day outside, by mid-morning it was warmer and lively; a great array of food, tea, coffee and sweets kept everyone going strong until the end of the day, it doesn’t get better than that when it comes to learning about pricing! 

We’re looking forward to day two, and especially excited for our 3rd Annual Global Pricing for Executives Summit.

The Pains and Gains in Pricing

Guest Post by Stephan Liozu

A recent survey conducted with 557 CEO’s and Business Owners around the world showed they pay little attention to pricing. When asked how they would allocated 100 points of attention between cost cutting, growth programs and pricing initiatives, pricing received an average of 16 points. A vast majority of the time is spend on fixed and variable cost control (54%). Clearly, and even though they realize the power of strategic pricing, top executives do not pay enough attention to it. So what is behind this lack of interest and attention paid to pricing by top executives? I conjecture that this lack of attention primarily comes from the fact that the pricing function does not excel at identifying, measuring and communicating the business pains of poor or non-existent pricing management. The pricing function also has a hard time measuring the gains generated by pricing activities as well as calculating the ROI of pricing activities.

So here are some tips on how to get started and make progress with this difficult exercise.

1) Show the pains

Pricing professionals should spend more time up front identifying and articulating the pains relating to pricing. That can be done by conducting a pricing capability assessment and performing the fundamental pricing analysis: cost-to-serve, waterfall, pricing cloud, etc. These pains then have to packaged in a dramatic fashion with one or two critical numbers that might turn into a story hook. These numbers have then to be communicated inside the marketing and pricing organization without created tensions and rejection.

2) Articulate the gains

Obviously, once the financial and efficiency related pains are identified, measured and articulated, the next step is to evaluate the potential gains of investing in pricing. This remains a very difficult exercise. A focus on short term gains might be necessary to get some initial attention. Like in the Lean Six Sigma methodologies, quick wins are greatly appreciated by top executives as they have a tendency to focus on short term impact. That gives pricers an opportunity to get a foot in the door, to tell their story and to come back for more "face time" later.

3) Create a story

Once pains and gains are identified and somehow measured, the next step is to create a story. That story has to be adapted to the business context, the dynamics of the external environment, the culture of the organization and the management style of the top leaders. Story starts with a strong hook which in this case is the pains: “every year, our organization loses $1 million in profit due to poor pricing.” The hook grabs attention and creates the opportunity to give your one minute non-technical elevator speech. The message is to convince top executives what you can deliver for them in gains to help reduce the pains. That story should be repeated in business meetings, in pricing discussions, and might be translated into goals and objectives for the pricing team. The story has to be crisp, credible, well articulated and somewhat dramatic.

4) Be ready to compete internally

In an organization, you compete for attention. You also compete for human and financial resources. This competition is internal and consists of functions that are in the mainstream and are able to calculate their ROI very well. That includes R&D, operations, innovation, technology and IT for example. For them, calculating ROI and demonstrating payback is expected and second nature. It is therefore very critical for the pricing function to be able to do the same.

5) Keep It Simple Stupid (KISS principle)

Top executives are busy people who have a very short attention span. Therefore you might have to talk to them like as if they were a two-year old child suffering from ADD. It is recommended to keep the message simple, well articulated, and business like. If you manage to get 30 minutes of top executive attention, do not bore them with long analytical explanations, super technical pricing methods, or 30 pages of PowerPoint. Work on a very simple story line using plain terms. That might sound like: "We are currently leaving $2.5 million on the table by not managing our profit leakages and not fully capturing pricing opportunities. With an investment of $150,000, we could get some quick wins, get our company on the path towards pricing excellence while getting a payback for it under 2 years."

I do find it paradoxical that pricing is a very analytically focused function which is not able to calculate and articulate the ROI of programs and activities. This is why Dr. Hinterhuber and I are launching another short survey to explore more information about how the ROI of pricing might be better calculated and communicated. Please support our initiative by taking this short survey.

Here is the link: http://weatherhead.qualtrics.com/SE/?SID=SV_ezWVJUBYxXpYTiZ

An executive summary will be sent to you if you choose to participate. Thanks for the support.

Stephan Liozu (www.stephanliozu.com) is the Founder of Value Innoruption Advisors. He specializes in disruptive approaches in strategy, innovation and value management. He is also a PhD candidate in Management at Case Western Reserve University and can be reached at sliozu@case.edu.