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The Complexity of Simplicity in Pricing



Author: DeAnn Hammer


We often find that we can be an anomaly in the pricing world when we begin to engage our stakeholders in the pricing topic of operational efficiencies and transactional customer ease.  It’s a topic that many in the pricing community may not focus on, however, it’s become the fabric of our being in trying to elevate our company into a world class pricing organization.


Why the focus here?  It starts with a turbulent experience in moving to a new operating system and swimming through a riptide of data.  You begin to ask portfolio managers if they understood the complexity of their flexibility in price options and prior negotiations.  Those portfolio managers are focused on launching new products, conducting price adjustments, and developing pricing strategies…well there is just not enough time to reflect and look back.  And if dared to turn around and look back at the mountain of data and creative pricing agreements, the task is more than daunting. 




Imagine the time investment required and the emotions of sales leaders.  It’s overwhelming and consuming.  There’s no rearview mirror in marketing.  How that pricing mess was created is not a concern.  Look forward and gain share.  The focus is only forward to gain share and volume.


How do pricing operations professionals begin?  Listen. Hear from internal stakeholders and external customers.  What are the pain points that are expressed when it comes to pricing?  It has rarely been the price itself that presents as the problem.


The external market often has similar responses around the world.  Even in the B2B space, customers are asking for a B2C experience.

External Customers Seek

·      A high functioning easy to use ecommerce experience

·      24/7 pricing

·      Self-service options

·      Easy to analyze pricing options to compare vendors and value for the intended purpose


Some Internal Customer Feedback

·      Pricing can be overwhelming

·      Margins can be difficult to see and understand

·      Clarity in price options available to target customers isn’t always transparent

·      Global business teams struggle with currency fluctuations, import/duties/tax

·      If pricing isn’t’ centralized, who do I call for help and how do I get this fixed? 


As pricing leaders, a very large part of our value is taking an assessment of the situation and understanding that if you can make your pricing strategy simple, does this leave room for growth?  If customers find it easier and easier to shop your offering will transactions increase?  Simplicity in pricing boosts sales effectiveness.


Our motto has become, if you can’t see the data or strategy clearly, neither can your customers.  Do you need to manage thousands of price points?  How can you reduce manual work or work that requires a subject matter expert?  Can you automate your quoting process and minimize approvals? 


Think about the customer experience journey in placing a purchase order.  Can customers independently push forward an order with accurate pricing without a phone call to customer service or their sales professional?  All purchasing agents sometimes ask for is a matching a purchase order to the material delivered on their dock with an invoice that has the same information.  MIND BLOWING. 


While this seems intuitive in the B2C world, in the B2B space in certain industries, software and capabilities are investments yet to materialize as operational priorities.  Be careful that your approval processes, promotions, volume buys, and special pricing agreements can be received and programmed into your customers systems.  In many cases rather than looking at your total pricing offering, your customers leave margin on the table when complexity is present.  Are you expecting your customers to unravel your tangled data set if a competitive option is available and easier to buy.  You need automation, clearly defined processes, leadership engagement, and governance.


In conclusion, the journey towards mastering the operationalization of pricing demands a relentless pursuit of simplicity in the face of complexity. Strive for pricing excellence by embodying the principles of speed, accuracy, and an unparalleled B2C experience. Rise to the challenge and elevate your strategies through heightened standardization, seamless automation, and an unwavering commitment to simplification. As you embark on this transformative course, remember true mastery lies not in the intricate, but in the art of making the complex appear effortlessly simple.  May your pursuit of pricing proficiency be marked by innovation, efficiency, and a resounding success that leaves an indelible mark on the landscape of your business.

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