Raising Price

Last year, I had a great joke about inflation. But it’s hardly worth it now.

Zeitgeist joke, courtesy of Aussie stand-up, Amos Gill.

You put your prices up lately?

If you haven't, you're likely an outlier.

Each tech B2B salesteam I've encountered lately has had to confront this.

An admittedly unscientific sample naturally, yet consider the context.

Those with whom I work feature several with some type of 'subscription', pppm model. An amount paid monthly on a scale depending on user numbers.

Note this is different to a pure pay-as-you-use model. I learned recently that even continental freight is charged on a per mile basis. The pay-per-click of the photocopier seems a long time ago.

You might think that charging '10' a month for someone's access in '22 can smoothly re-appear in '23 as '11'.

It's not quite as simple as that. Yet when everybody feels forced to do so - the inflationary supply spike did precipitate salaries rising - the most common effect flows when one key player does so, triggering the rest to follow in true dominoes fashion.

Many tried to absorb as much cost pressure as they could.

Others knowingly timed, packaged and re-purposed new features to align, elide and coincide so as to blur the comparison lines between what was, and what now is.

Proposed purchases I deal with are often less price sensitive. That's not to say products in the solution space are necessarily what economists would call immune to elastic squeeze. But they tend to examine return in some way which can lessen the pushback on pure price.

If you've a product (or service) of which you're proud, then surely you know the typical returns it unleashes.

If this is based in any way on the b-school reckoner of hourly unit input costs, then they'll have risen ten percent or so. Reflected no doubt in your investment schedule provided.

There is a split here between farmers and tigers. Existing customers need to be prepped for the bad news of the atypical raise well ahead of their annual budgetary reviews, with proven business case numbers. New clients in the dark about your price list of two revisions ago, must be left in no doubt as to where your uniques outscore all alternatives.

In either case, you are not selling against the latest price hike blip. You must still sell why you are worth any extra beyond that lower figure which competitors may pretend to charge.

Despite the distraction increased price tags bring, don't lose site of this most important of solution sales fundamentals.