June 26, 2020
“If everyone was an expert on everything no one would make mistakes.” – Ben Franklin, 1785
If you put a bunch of pricing professionals in a room, one thing they’d all agree on is that replacing manual or Excel based pricing systems with price optimization software would lead to substantial revenue gains and measurable profit improvement.
A business case could be put together that could conservatively project a return on investment for a price optimization project that would stack up favorably against other software investments and many capital projects. But if that’s the case, why isn’t every mid or large enterprise using price optimization software? Many times over, the answer is there’s a key player in the organization who hasn’t yet bought into the concept.
Most companies have a team or department that focuses on pricing. But when push comes to shove, who really owns the price a customer is charged? Usually it’s the sales organization run by a key player: The Chief Sales Officer. One thing I’ve seen consistently in my more than 25 years in the enterprise software space is that when the head of sales is convinced a project needs to be undertaken to make the numbers, it usually happens.
The CSO is the person in the organization who needs to be sold on price optimization. What’s the best way to turn the CSO into your price optimization project evangelist?
Selling to the seller
You’re going to have to sell your idea to someone who sells for a living, so you better proceed thoughtfully. You’ll need to start the soft-sell conversation by getting the CSO to admit that there’s problem he or she doesn’t even think exists – especially if the sales team has at least a few experienced, effective salespeople. Your conversation needs to revolve around the concept of the Expert Salesperson.
What is an Expert Salesperson? This person is the one who knows their markets and the competition, understands their customers and what they want and, when it comes to pricing, knows how far he or she can go and still get the order. The Expert Salesperson always hits their numbers and makes quota.
Expert Salespeople may not be familiar with the term willingness to pay but they do live and breathe the concept on every quote. If you can get your CSO to understand the Expert Salesperson concept and agree that they exist, you’re on your way to turning the CSO into your evangelist. After describing the Expert Salesperson and getting buy-in, ask the questions:
- Are all of his or her salespeople ‘experts’?
- What if they all could be?
Turning every salesperson into an ‘Expert Salesperson’
This is your opening to start talking about price optimization software concepts. The approach is about providing the tools to turn every salesperson into an Expert Salesperson and make the current Expert Salespeople even more effective.
Data driven, statistically based segmentation can group together customers with similar willingness to pay to uncover opportunities to get a better price – just like the Expert Salesperson does in his or her head. Floor, target and expert price guidance guardrails building on willingness to pay can give the rookie salesperson the confidence to ask for a higher price that similar customers have paid.
There’s even something in it for the Expert. They may know the best price on their ‘A’ items and most ‘B’ items, but what about the thousands of ‘C’, ‘D’ and ‘E’ items that don’t come up on quotes every day? Price guidance can help the expert with those.
It’s going to take some work to sell to the head seller, but if you can get the Chief Sales Officer in your corner, you’ll be well on your way to getting your price optimization project moving.
Some additional recommendations
- Do your homework. Be prepared with some open-ended questions to get the conversation with your CSO going.
- Find out who the Expert Salespeople are in advance so you can name names.
- Listen before you speak.
- Don’t start off by talking about software, whatever you do! Get agreement that there’s a problem that needs solving – talk about concepts and then talk about potential solutions (which could include software).
Looking for more ideas on how to get a project going? Download 10 Tips for a More Successful Price Optimization Project.