It’s no secret the economy is in flux.
In October 2021, the Consumer Price Index (CPI) reported a 6.2% annual inflation rate in the US, the highest in more than three decades. And despite an improving pandemic picture, we’re not out of the woods yet — this volatility is expected to continue in the upcoming years with everything from food to automotive parts to B2B software.
In an unsure economy rife with production challenges and aggressive competition, you’re likely facing pressure to reduce costs and/or raise prices to maintain profit margins. Paying attention to pricing may make the difference in surviving the economic uncertainty.
How can you make pricing decisions in a drastically shifting and reactive market? It starts by getting your product pricing and packaging right.
Your pricing controls much more than you might realize. While it includes the profit margin on each unit sold, it also controls your revenue and margins in a multitude of more subtle ways. The game of pricing, positioning, and profit is won by hundreds of tiny decisions each day. Firms that keep pricing top-of-mind throughout those decisions and regularly revisit their pricing approach outperform those that don’t.
3 Key Attributes to Look for in Effective Pricing Consultants
If you aren’t sure you have the proper pricing or packaging, finding the right partner to guide you through a price setting and price getting process is critical. The right pricing consultant can be an invaluable partner to drive innovation, revenue growth, and product profitability.
Have you ever been pitched a project by a partner at a consulting firm and then been disappointed that your day-to-day deliverables were delegated to an associate with less experience? We’ve been there. The first question to ask when working with a pricing transformation consultant is who will be engaging with your team and handling the day-to-day management of your account. Details matter, and your advisors should be experienced operators.
Questions to ask of your pricing consultant include:
- How long have they been doing pricing?
- How complete is their approach?
- What deliverables should we expect?
- What skillsets are brought to the table (pricing, packaging, data analytics)?
Blue Rocket operators are experts with over 20 years of experience. We’re all partner-level, former Fortune 500 tech executives who have worked with dozens of clients to overcome drastic economic shifts. That means only experienced executives work with clients’ day-to-day needs, overseeing your pricing transformation on a macro and micro level.
Effective partners should take an experienced, hands-on, and results-oriented approach.
Expertise: Most consulting firms have three tiers of employees: finders, minders, and grinders. The “finders” are the partners who generally bring in business, “minders” are mid-level employees who supervise, and “grinders” are those who work daily with the client. This means that often those with the least experience are working daily with clients. Blue Rocket has a no-leverage model that ensures everyone is partner quality and that you have experts working one-on-one to address your most pressing needs.
Hands-on: An effective consultant doesn’t just help rewriting strategy. Instead, they work with you to facilitate implementation. At Blue Rocket, skills transfer is a pivotal part of our approach. We work alongside our clients to show them how to get through challenges. That way, after our consultants leave, you still have the tools to make sound decisions.
Results-Oriented: Some consultants provide an audit and then leave clients with a PowerPoint hoping that the plan will come to fruition once they are gone. But there are often unforeseen factors and unexpected challenges that crop up during implementation. That’s why your chosen partner should be with you to help navigate. At Blue Rocket, we land the work. That means that when we leave, new pricing is in place and working, directly showing improvements to your bottom line.
It may not be what you expect, but values matter in a pricing consultant. Here are the values that matter and why they make a difference.
Candor can be difficult to hear, but honest feedback is how you get the information you need to make good decisions and move forward. Will they tell you the hard truth? The first step is often a cold, hard look at what’s happening in a business. A consultant can easily overpromise and tell you what they think you want to hear to get quick (and perhaps unattainable) results. Hiring teams with integrity and candor is critical to receive pragmatic and achievable outcomes.
Empathy is created when they’ve been there. Can your consultant appreciate how hard the process is? If not, they may not be able to produce effective solutions. Empathic environments improve understanding in communication. This is particularly important in emergencies or other difficult situations where stress is high.
Practical and actionable strategies are key. It may be good in theory, but can it actually be done? Our breadth of experience and pragmatic, hands-on approach means we provide practical solutions.
Effective partners have results to show for their work. Will they work with you until the job is complete, or will they leave before it’s time? A competent diagnosis requires honesty and empathy to find and create a solution to the problem. Commitment is required to see a solution through.
Making Informed Strategic Pricing Decisions Begins with an Honest Look at Ourselves
The B2B software world is changing rapidly, and the pandemic has likely pressured you to make quick and reactive decisions. However, with the right strategies and sound principles in place, you can make confident decisions to stabilize and grow your business, even in a volatile market. A quality pricing advisor empowers you to make the best decisions for your business.
Blue Rocket has a unique approach to consulting. Others operate with junior-level associates who conduct an overarching audit and leave you with a to-do list.
We operate differently. As a team of experienced technology executives, we’ve been in your shoes and know the difficult decisions you have to make. Our experience working at some of the world’s largest technology firms informs our approach to everything we do, from our pricing and packaging guidance to our advice on decision-making in tough times.
It’s how we deliver actionable insights that are practical, effective, and holistic. We don’t just think about how price is set, but also the inputs such as segmentation, value proposition, and other factors necessary to land pricing such as sales compensation, quote to cash systems, and more.
For many companies, the details in pricing make the difference in survival during the economic downturn and being prepared to embrace opportunities when they present themselves. Contact us and our team will be with you every step of the way to help you make decisions on pricing during this critical economic moment.