Matt Medeiros is co-owner of a web agency, host of a podcast and developer of WordPress plugins. In this episode, he talks about his experience in car sales and pricing products.

What have you learned about selling and pricing from car sales?

* Selling cars can help you learn to listen and how to deal with “tire kickers.”

* You can develop a niche even in the car sales.

How does value influence a conversation you have with a customer?

* Explain your experience to help the customer see value in your services.

* Provide insight to help the customer understand how to make money with a website.

* “Why have you not done ‘this' yet? and What is that costing you?” are two of his favorite questions.

* Matt sends a “belief document” which sets the stage for a value conversation.

* The belief document can explain the process or be a gatekeeper – it serves a dual purpose.

* Matt shares his thoughts on retainers and tiered support pricing.

What is your opinion of pricing products in the WordPress space?

* With Conductor, for example, you cannot give it away for free and recoup your money.

* Matt's themes are not priced high, but they are lean and mean.

* WordPress pricing is inexpensive compared to other software markets.

* “Free” does not include consistent support from the developer.

About Matt Medeiros

* Co-founder of Slocum Studios

* Host of The Matt Report

* Recently launched Conductor plugin

* Former car salesman for General Motors

* Twitter: @mattmedeiros

Sean Nisil is a fee-based financial advisor, whose mission is to help people to live their ideal life now and in retirement.

What is the most important thing you can share about pricing?

* Clarity: What am I, as a service professional, going to be providing and setting the expectation clearly.

* Compensation as a financial advisor can be commission or fee-based.

* The fee-based model allows the customer to understand the service being offered, how much it will cost and what the value is they will receive.

* Commission-based fees can cause a conflict with your customer's best interest.

* As the customer succeeds, so does the advisor. If the customer doesn't succeed, neither does the advisor.

* Registered Investment Advisor (RIA) practices take the value pricing model and overlay it on the financial industry.

* Fee-based pricing is a competitive advantage in the financial industry if you are in it for the long-haul.

How do you help customers in a value pricing conversation?

* Ask good questions: What are your pain points when it comes to retirement?

* Talk about goals and your ideal life. If you can't fund the ideal life, you simply aren't going to get there.

* Number one rule: spend less than you make.

* People like choices. It puts the customer in the driver's seat and allows you to work together as a team.

* Part of serving is having the money conversation.

* Remind the customer of the service you are providing and the value that you are creating.

How do you advise those who are timid about pricing?

* When you charge what you're worth, it will increase the quality of your customers.

* When you are timid about delivering a service, you can undercut what you're worth.

* If you aren't being paid what you're worth and you're in cash-flow crisis, you will not be around to serve the customers you are serving right now.

* If you don't know why you are in business or you don't know the value you are providing, it will be hard to have a value conversation with your customer.

* If you're having doubts about implementing value pricing, Start With Your Why (Simon Sinek).

* You need to have a mission statement – both business and personal.

About Sean Nisil

* 8 years experience in financial planning

* Contributor to FaithDrivenBusiness.com

* Theology major in college

* RetireMeASAP.com

* LinkedIn: Sean Nisil

* Twitter: @SeanNisil

Casey Lewis is a consultant, helping people get out of debt. Additionally, he is a real estate agent. This episode shows his perspective on value in those areas.

What is the most important thing you can share about pricing?

* If you can't help solve a problem or add value, it is OK to walk away from a sale.

* Sometimes the best way to serve a customer is to not serve them.

How does pricing work in residential real estate?

* Real estate agents can charge the percentage they choose between the real estate brokerage and the buyer, so there is an opportunity to add value.

* Pick your own commission rate (8-9%) by enticing the buyer's agent to show your house over the other houses.

* Price is one of the biggest parts of a real estate transaction.

How does marketing affect the real estate price?

* The real estate agent is responsible for helping set the price marketing. The seller is responsible for the condition of the house.

* Condition and marketing are the other two parts and you can increase price based on those things.

* You can add value by taking pictures with a professional photographer.

* Under promise and over deliver is a general rule of thumb that can apply to all businesses.

* Coaching, with a money-back guarantee, has some perks that Casey doesn't bring up during the initial consultation, like getting his books and some tools.

* Airplane ticket pricing is a good example of how different people are priced differently.

About Casey Lewis

* Speaker, author and financial coach

* Helps people manage their finances and chase things they really care about

* Author of Impact – Get Rich, Be More Awesome

* Real estate agent in Dallas / Fort Worth

* Casey-Lewis.com

In this episode, Wes McClure continues the interview with Kirk, discussing how he uses value pricing from the perspective of a business owner and with his team.

How do you ensure your team understands value?

* Talk about it all the time.

* Learn from experience.

* Team members can shadow on a call to learn.

* Your team will challenge you.

* Have a pricing council.

* We ask subcontractors for a fixed price, but they are usually providing an effort-based price.

* The more people there are who are looking at a project from a value perspective, the better it is for the customer.

* My team has authority to write and price under a certain dollar amount.

How does value pricing work with Agile development?

* Kirk believes in an Agile/Waterfall development process.

* Agile transfers more risk to the customer.

* You have to define your boundaries, but set a price to give you flexibility.

How has value pricing affected you and your company financially?

* A debt-free business with savings allows us to make better decisions.

* Having the ability and confidence to say no is easier when you are not “living paycheck to paycheck”.

* Collect money upfront and then work harder to serve a customer who trusts us.

* Value pricing allows you to go to conferences, work on internal projects and gives you room to experiment.

* Shift customer perspective from inputs to outputs.

* Guarantee your work.

* Team will do everything in our ability to make a project 100% successful.

* Becoming a pricing consultant came out of value pricing for my software company.

* Coaching and training offerings are coming out of the value pricing world.

* Value is subjective; every price is contextual.

Thanks to Wes McClure for conducting this interview, wesmcclure.com.

In this episode, Wes McClure interviews Kirk on his path to value pricing, the challenges with hourly billing, and the process he uses now with his customers.

What was your path to value pricing?

* Life-long entrepreneur.

* Custom software developer “by the hour” for the 15 years.

* Switched to value pricing for 5 years ago.

* Kirk shares his “conversion” story.

* Getting to the point you are willing to say no if you can't help the customer becomes an integrity issue.

* Billing by the hour ends up being an estimate due to how time sheets are filled out.

* Hourly billing is a misalignment between the customer and the provider.

* It's easier to succeed with smaller phases than one big one.

* With hourly billing, on-boarding a customer was trying to dazzle him with technical expertise.

* Now there is a formal process that takes 2-3 weeks.

* Good software bakes in the oven for a while, so speed is not usually the priority.

* The higher the value, the more patient a person is going to be to get there.

* Discovery is a paid engagement.

* The biggest value that the customer gets out of discovery is that they will know the value.

* The second benefit to discovery is education, better understanding of what they really need.

How did you switch existing customers to value pricing?

* Start with new customers.

* Then start with smaller projects where the investment isn't that big.

* Lastly, deal with the existing customer-base.

* Give them a heads up.

* Customers will either embrace, try it and not like it, or will not try it.

* You have to be ready to clean house.

* When you start to charge for value, the customers might still want that value for free.

* Say no by offering a choice.

* Whatever discovery can be completed in a day is about as much as can be tackled in a project.

* 2-3 phone calls happen before a discovery project is suggested.

* After discovery, we offer 3 options in a development proposal.

* If there is a substantial change in scope, we present a Change Request.

* Be reasonable with your value conversation and look at the bigger picture.

* How to handle ongoing support:

* By individual request

* With change bucket

* How to handle emergency situations:

* Preventive approach to avoid emergencies

* Provide premium price to solve the problem and do it immediately

* Don't keep customers who won't follow best practices

How has boldly discussing value helped?

* All profit comes from taking on risk.

* By being bold, there are bigger opportunities to create bigger value.

* By being bold, the customers who really aren't a good fit will screen themselves out sooner.

* To a customer, bringing in an outside consultant is taking a risk.

Thanks to Wes McClure for conducting this interview, wesmcclure.com.

Tom Morkes is an expert at Pay What You Want pricing. In fact, he wrote a book on it. PWYW pricing lets the consumer choose the price to pay for the product or service.

What is the most important thing you can share about pricing?

* Pricing is marketing.

* How you price your products and services is part of marketing, and therefore part of the sales process.

* Pricing is essential early in the process, while you are developing a product or service.

What is Pay What You Want pricing?

* Pay What You Want pricing lets the consumer/buyer decide the price of the product or service.

* It doesn’t work with commodities.

* Marketing is more important with Pay What You Want pricing.

* Some people will pay you more if you remove the fixed price.

* The Vennare Brothers’ The Hybrid Athlete inspired Tom’s interest in this pricing method.

* It is not relegated to products, but can also work with services.

* If you can’t express the value you are offering, this pricing method will not work.

* Price anchoring is an important marketing technique for this method.

* A blank space for people to put in any number is not the best option for more expensive products and services.

* If you remove the caps (low and high), people will pay you more than you think they will. It will also remove the barrier to entry on the bottom end.

* You have to be comfortable that some are going to pay less, but a small percent will pay dramatically more, offsetting the lower buyers.

* You need to rely on the people who are generous to sustain you, which is a smaller percentage of the buyers.

How does Pay What You Want compare to other price concepts?

* Crowd Funding is different from Pay What You Want, but they are similar and can learn from each other.

* How do you show someone the value?

* How do you encourage them to be generous?

* Value Pricing and Pay What You Want use tiers or options.

* TIP (To Insure Performance) is a combination of Value Pricing and Pay What You Want. TIP is similar to how bartenders and waiters price.

* Pay What You Want Invoicing – Send a blank invoice and let the customer choose what to pay.

* Experiment and try it out on small projects, like charging for parts and letting the customer pay what they want for service.

* Some examples of Pay What You Want Pricing

* Storyline Conference

* Humble Bundle

* Half Elf, by Mika Epstein, is doing a bit of everything.

* Gumroad is an ecommerce site that supports Pay What You Want well.

About Tom Morkes

* U.S. Army Veteran, who served in Iraq

* Attended a 2-day workshop with Seth Godin

* Author of The Complete Guide to Pay What You Want Pricing

* Founder of Insurgent Publishing

* Graduate of the West Point

* TomMorkes.com

Gearbox Solutions is switching to value pricing. In this episode, owner Marty Thomasson discusses his experience during the transition and the impact on the business.

What is the most important thing you can share about pricing?

* Moving to value pricing requires a full commitment.

* It requires changing the way you think, including new soft skills.

* Changing your business to value pricing is a philosophical change.

* Value pricing is a technique to create a win-win for the customer and the business.

How has your conversation with your customer changed?

* Talking about value more quickly, not just talking about features.

* We want the customer to know that we are going to guide, consult, identify the problems and the why behind them.

* Discussing value earlier in the conversation, the customer sees a different approach than our competitors.

* Once we learned we were not building a commodity, it led to value pricing.

* Your interests become the customer’s interests.

* Focusing on hours ignores the results. It focuses on minimizing or maximizing the time spent.

* You can make more money through value pricing, but it is not gouging the customer.

* Knowing you have made a dramatic difference in someone’s life is what drives Marty.

Why are you an entrepreneur?

* Marty enjoys seeing opportunities and going after them.

* He likes to constantly learn and value pricing is a new area of learning.

* The value pricing process allows Marty to take one step back and discuss the value the customer will receive.

* That conversation increases his value to the customer.

About Marty Thomasson

* Founder of Gearbox Solutions

* Has been in business for 15 years

* Had a screen printing company in college

* First business was mowing lawns at age 13

* Twitter: @gearboxatl

Jason Blumer is an accountant and entrepreneur, constantly starting businesses. His focus for the past few years has been on business coaching, trying to change businesses from the inside out. He is trying to single-handedly start a revolution in the accounting industry. He runs Blumer CPAs, a virtual accounting firm. He started the Thriveal CPA Network to help accountants stop billing by the hour and start pricing on the value they create for their customers. He has two podcasts of his own, Thrivecast and the Businessology Show.

Price is Tied to Value

The single most important decision in evaluating a business is pricing power. If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. – Warren Buffett

* What is the most important thing you can share about pricing?

* The future success of a business is in its ability to price high.

* If you can’t raise your prices, you have to figure out why.

* Value pricing is a methodology. There is no right price.

* Price is intrinsically tied into value.

* Learning to have the value conversation is at the heart of value pricing.

* How do you know if you are profitable when you are not tracking time?

* You can look at your P&L statement to determine if you are profitable.

* You do have to know your costs; they are hard numbers.

* Cost is the cash you have to pay to deliver on the value promises you are making to your customer.

* Profit is not the same thing as cash flow, which ebbs and flows, depending on how you scope documents and present terms.

* Value pricing can improve and predict your cash flow.

* You price better and your margins are better with value pricing.

* Value pricing is a hard thing to do – it is the right thing to do, but it is harder.

* It is good to have support from a coach to help you make the change.

* What is one of the biggest obstacles when switching to value pricing?

* Value pricing is a methodology where there is no “right” price.

* You have to become comfortable with the fluffy discussions of value and the unknown subjective world.

* You can still use a spreadsheet to calculate the price.

* How do you define value pricing?

* Value Pricing is how to get the maximum price for the value you’re promising.

* Business is win-win; you can’t price high (promise high value) unless the customer receives high value.

* Both sides have to believe that the agreement is awesome.

* Value pricing forces you to be more intimate with your customers.

* Your customers begin to trust you with their fears and failures in order for you to provide the best value for them.

* How do you push through the “uneasiness” of pricing?

* You can help people push through the uneasiness with coaching.

* Pricing is a skill you get better at, but you never stop learning.

* It is a courageous thing to get aligned on the right things with your customers.

* You have to push through the fear and leave your money baggage conversations behind.

* Coaches can help you unlock what you are struggling with.

* You must believe you create value.

* The business owner does not have to do the pricing; determine who is the best person to do the pricing for your organization.

* Check your own perceptions of value at the door...

Ron Baker is the author of six books, including Implementing Value Pricing. He’s the founder of the VeraSage Institute and a Graduate of Disney Institute. He’s on the faculty of the Professional Pricing Society and a host on a talk radio show, The Soul of Enterprise. He’s a LinkedIn Influencer blogger and a recovering CPA.

All Value Is Subjective

* What is the most important thing you can share about pricing?

* Prices are ultimately set by value, not by the competition or supply/demand, but by value.

* Value is subjective. It is a feeling, not a number.

* The technical definition of value is the maximum price a consumer will pay for an item.

* If you willingly pay a certain amount for something, it is worth more than that to you.

* The customer has to make a profit too.

* The value graph:

* Customers don’t care about the cost to the business.

* The price set has to be above the cost or the business makes no profit.

* The value has to exceed the price or the customer makes no profit.

* Both the seller and the buy want to maximize value and that’s the one area where our interests are aligned.

* Inputs are irrelevant; the results are what matter.

* What was your first exposure to value pricing?

* He left his Big 8 firm and started his own firm with Justin Barnett.

* He learned quickly that his customers were not buying his time.

* Ron switched to value pricing to enhance the customer experience.

* The billable hour is a lousy customer experience.

* Offer the customer a money-back guarantee to assure the customer you aren’t gouging them.

* If any customer complains loudly enough, you are going to write it off anyway.

* Of your six books, which is your favorite?

* Ed Kless says Professional’s Guide to Value Pricing compared to Ron’s most recent book is the Old Testament vs. the New Testament.

* Firm of the Future with Paul Dunn has stood the test of time.

* Measure What Matters to Customers was one of the books that Ron has the most fun writing.

Learning to Discover Value

* How long should the consultant talk during a value conversation?

* The customer should talk 80% of the time; consultant only 20%.

* Usually, the professional ends up talking 60-70% of the time.

Troy Dean is from WP Elevation, which is the first and only business accelerator program for WordPress consultants. He is a musician (guitar) and voiceover artist. He began building websites in WordPress in 2000 and transitioned to running an agency in 2009. Two of his most prominent customers include Jessica Watson, who was the youngest girl to sail around the world, and they recently redeveloped the QuickBooks Blog.

Pricing is Arbitrary

* When you were a kid, what did you want to be when you grew up?

* On Troy’s show, this is always his first question.

* When he was a kid, he wanted to be a performer – a rock star or an actor.

* He was and still is addicted to connecting with a large audience.

* While he has played music and acted, he leads a tribe in his business as part of this addiction.

* After running a workshop from 7am to 9pm, he was completely exhausted, but on a high from having such an impact on people’s lives.

* What is the most important thing you can share about pricing?

* It is completely made up; it is totally arbitrary.

* Melbourne is the home of coffee and every café has a different price for the same soy latte.

* You have complete control over your own pricing because there is no formula.

* Pricing can free you to think creatively about how to attract the people you want and repel the people you don’t.

* If you trade time for money, there’s a ceiling on how much you can earn as an individual and a company.

* You are restricting your income if you have an hourly rate.

* If you are asked for an hourly rate, you are probably being price-shopped for the cheapest rate.

* An hourly rate is an arbitrary figure that two parties agree on when they can’t agree on the value being transferred in the transaction.

* Your job is to highlight, illuminate and tell the story of the value you will be adding.

* Bartering and negotiating becomes an issue when you quote a number of hours and an hourly rate.

* Tom Willmot of Human Made, whose customers include Skype, gave him the best advice when it comes to competing on price: look around and make sure you are deliberately priced higher than everyone else.

* If you want premium customers, to produce a premium product, and to be in a premium business, then make sure your price is premium.

* If you can understand the problem you are solving and the value you are adding, it becomes easier to set a price.

* How would you counsel the freelancer who is billing by the hour?

* Just stop billing by the hour.

* With new customers, you simply reinvent yourself.

* With legacy customers, it is more difficult.

* To switch to value pricing, stop mentioning features and technology, and start mentioning benefits.

* If you can consistently highlight the benefits or the headaches that you can solve for them, you can then present investment options and avoid the hourly rate conversation.

* If your customers won’t switch, you might have to fire them.

* Most customers don’t want to switch providers and will have a conversation with you about changing the way you do business together.

* You are doing your customers a disservice by not having a sustainable profitable business.

* Value pricing aligns the customer and the provider.