Impact Pricing

Steven Forth is Ibbaka's Co-Founder, CEO, and Partner. Ibbaka is a strategic pricing advisory firm.

In this episode, Steven discusses how AI, particularly transformer models, is revolutionizing business strategies by automating complex tasks like value modeling and scenario planning, making them more efficient. He emphasizes the importance of leveraging AI to explore frameworks and generate innovative solutions, such as using AI to better understand industry problems. Steven also highlights the ongoing development of prompt orchestration tools, which will soon become essential for managing AI workflows and optimizing the use of multiple models.

Why you have to check out today's podcast:

• Discover how AI is transforming traditional frameworks like value modeling, scenario planning, and pricing, making complex processes faster and more efficient.
• Gain insights on how AI can help you better understand problems and create innovative solutions, ultimately improving your decision-making process.
• Dive into emerging concepts like prompt orchestration and how AI is evolving, giving you the tools to enhance your AI workflows for maximum effectiveness.

"Create a series of prompts, create a series of context documents that you can reuse and explore the framework in ways that you never could before and find ways of applying it."

- Steven Forth

Topics Covered:

02:10 - How no single AI model can meet all needs, thus, advocating for multiple model for diverse perspectives and specialized capabilities

03:11 - Distinguishing between diffusion models and transformer models

05:46 - How does a transformer model work

07:28 - Understanding the [LQMs] Large Quantitative Models, [RAG] Retrieval Augmented Generation and challenges faced by companies like Pros in leveraging customer-owned data

11:39 - How Wolfram/Alpha uses mathematical reasoning to validate and simplify equations and highlighting the emergence of reasoning models for complex problem-solving

15:34 - Steven reflecting on his increasing reliance on AI tools, how they are transforming his thinking, and the need to embrace these technologies as vital partners in enhancing exploration, communication, and decision-making

17:17 - How generative AI enables more dynamic and efficient approaches to scenario planning

23:29 - Emphasizing how leveraging AI with established frameworks accelerates complex tasks like building value models

25:13 - Learning 'prompt orchestration' to optimize prompt sequences and responses

26:52 - Explaining Perplexity's limitations in generating complete outputs

Key Takeaways:

"It used to take Ibbaka between 40 and 60 hours of work by a highly trained person to build a value model. It now takes us less than two hours to build a better value model than we could have done before." - Steven Forth

People / Resources Mentioned:

• Geoffrey Hinton: https://en.wikipedia.org/wiki/Geoffrey_Hinton
• Bloomberg: https://www.bloomberg.com/asia
• Attention is All You Need paper: https://en.wikipedia.org/wiki/Attention_Is_All_You_Need
• Sam Altman: https://en.wikipedia.org/wiki/Sam_Altman
• Karen Chiang: https://impactpricing.com/podcast/467-minimize-churn-and-boost-your-net-dollar-retention-with-karen-chiang/
• Porter's 5 Forces: https://en.wikipedia.org/wiki/Porter%27s_five_forces_analysis
• Clayton Christensen: https://en.wikipedia.org/wiki/Clayton_Christensen
• William Gibson: https://en.wikipedia.org/wiki/William_Gibson
• Perplexity AI: https://www.perplexity.ai
• ChatGPT: https://chatgpt.com
• You.com: https://you.com
• Hugging Face: https://huggingface.co

Connect with Steven Forth:

• LinkedIn: https://www.linkedin.com/in/stevenforth/
• Email: [email protected]

Connect with Mark Stiving:

• LinkedIn: https://www.linkedin.com/in/stiving/
• Email: [email protected]

This is an Impact Pricing Blog published on October 24, 2024, turned into an audio podcast so you can listen on the go.

Read Full Article Here: https://impactpricing.com/blog/context-driven-pricing-the-ultimate-pricing-strategy/

If you have any feedback, definitely send it. You can reach us at [email protected].

Now, go make an impact.

Connect with Mark Stiving:

• Email: [email protected]
• LinkedIn: https://www.linkedin.com/in/stiving/

Russ Winer is a William H. Joyce Professor of Marketing, Stern School of Business, New York University. His specialties include pricing, new technologies, consumer choice models, and advertising.

In this podcast, Russ discusses the critical role of understanding consumer behavior in pricing decisions, emphasizing the importance of considering how customers will react to price changes. He explains the difference between academic theories and practical applications in marketing and also highlights the growing shift of research from academia to industry, particularly in data-driven fields like marketing, and stresses the need for businesses to stay competitive while balancing consumer protection and profitability.

Why you have to check out today's podcast:

• Gain practical advice on how businesses can align their pricing strategies with consumer behavior for maximum impact.
• Discover the unique perspectives on how academic research shapes real-world marketing practices and why general theories can be a game-changer for business strategies.
• Learn about the challenges and opportunities in both B2B and B2C markets, including data availability, decision-making processes, and competitive pressures.

"Don't forget the consumer, or customer, if it's B2B, when you're thinking about the price. How is the customer or consumer going to react when you take this particular action?"

- Russ Winer

Topics Covered:

01:48 - One accomplishment that brings Russ great pride

02:13 - Describing his entry into pricing

03:56 - Clarifying that he did not introduce the concept of reference price, though he was the first to incorporate it into empirical models

04:45 - Distinguishing reference pricing from behavioral economics

06:40 - How context influences reference prices, highlighting the relevance of acquisition and transaction utility in pricing

08:08 - Explaining the psychology behind 99-cent pricing

09:50 - Discussing deceptive pricing, highlighting practices like false markdowns in both brick-and-mortar stores and online retail

11:59 - Comparing deceptive pricing to deceptive advertising

14:33 - Differentiating between academics and practice in marketing

17:23 - The data availability challenges between B2C and B2B research

20:20 - Reflecting on the shift of research dominance from academia to industry

25:44 - How marketers' strategies to influence reference prices are not inherently harmful to consumers

28:14 - Russ's one best pricing advice

Key Takeaways:

"It's not just the firm side that's important when we think about pricing, it's also the consumer side, how they react to the prices that we're putting in the marketplace." - Russ Winer

People/Resources Mentioned:

• Bob Lucas: https://en.wikipedia.org/wiki/Robert_Lucas_Jr.
• Richard Thaler: https://en.wikipedia.org/wiki/Richard_Thaler
• Dan Kahneman: https://en.wikipedia.org/wiki/Daniel_Kahneman
• Amos Tversky: https://en.wikipedia.org/wiki/Amos_Tversky
• Facebook: https://www.facebook.com
• Airbnb: https://www.airbnb.com
• Google: https://www.google.com/
• Campbells: https://www.campbells.com/

Connect with Russ Winer:

• LinkedIn: https://www.linkedin.com/in/russ-winer-4b69b7/
• Email: [email protected]

Connect with Mark Stiving:

• LinkedIn: https://www.linkedin.com/in/stiving/
• Email: [email protected]

This is an Impact Pricing Blog published on October 17, 2024, turned into an audio podcast so you can listen on the go.

Read Full Article Here: https://impactpricing.com/blog/profit-vs-market-share-which-should-your-business-prioritize/

If you have any feedback, definitely send it. You can reach us at [email protected].

Now, go make an impact.

Connect with Mark Stiving:

• Email: [email protected]
• LinkedIn: https://www.linkedin.com/in/stiving/

Mike Wilkinson is referred to as The Value Sales Expert whose focus is on value and value selling.

In this episode, Mike shares what is involved in a successful value-based selling to enable tailored solutions that address specific challenges of your customers. He emphasizes the importance of measuring and reinforcing delivered value while developing ongoing relationships to uncover new opportunities and ensure long-term success.

Why you have to check out today's podcast:

• Learn about a five-step value-based selling framework to help you master value-based selling and deepen customer relationships.
• Gain Insights from real-world perspectives, practical advice, and candid reflections on overcoming common sales challenges.
• Discover how to shift from a product-first to a customer-first mindset and transform your sales approach.

"The most important thing from a seller's point of view is be confident in your price. And the way to be confident in your pricing is to make sure that you know, you're absolutely certain, that the value that you are delivering is more than a match for the price you're going to be charging."

- Mike Wilkinson

Topics Covered:

02:21 - Mike describing what he does

02:52 - Elaborating on the concept of value

07:33 - Highlighting the 'Value Triad' as it relates to the value drivers

11:08 - Mike's approach to teaching value-based selling

14:46 - Outdated sales practices that focus on pushing products rather than solving customer problems

16:48 - Thoughts on Zig Ziglar's sales principles and the importance of value discovery in the sales process

21:48 - How to ask impact-driven questions

24:07 - Detailing an effective value discovery and value demonstration to ensure a successful conclusion

26:51 - What value delivery means

28:07 - Value development and what it encompasses and the importance of regular reviews

29:33 - Mike's best pricing advice

Key Takeaways:

"Until we understand how our customers are defining value for them, then to all intents and purposes, value is a mystery. And as sellers in particular, our job is to solve that value mystery." - Mike Wilkinson

"It's your customer that defines value, not you." - Mike Wilkinson

"Until you've understood what the issues are from the customer's point of view, you do not have a solution." - Mike Wilkinson

People/Resources Mentioned:

• McKinsey: https://www.mckinsey.com
• Zig Ziglar: https://en.wikipedia.org/wiki/Zig_Ziglar
• Seth Godin: https://www.sethgodin.com

Connect with Mike Wilkinson:

• Website: https://axiavalue.com/
• LinkedIn: https://www.linkedin.com/in/mikewilkinson-thevalueexpert/
• Email: [email protected]

Connect with Mark Stiving:

• LinkedIn: https://www.linkedin.com/in/stiving/
• Email: [email protected]

This is an Impact Pricing Blog published on October 10, 2024, turned into an audio podcast so you can listen on the go.

Read Full Article Here: https://impactpricing.com/blog/what-every-team-should-learn-from-pricing-experts-focus-on-value/

If you have any feedback, definitely send it. You can reach us at [email protected].

Now, go make an impact.

Connect with Mark Stiving:

• Email: [email protected]
• LinkedIn: https://www.linkedin.com/in/stiving/

Daniel Cho has over 29 years of experience in the healthcare industry, currently serving as the Senior Director of Global Pricing at Philips Healthcare. With a background in sales, product management, and pricing strategy, Daniel has a unique perspective on how to effectively communicate value to customers and drive profitability.

In this episode, Daniel shares his journey into pricing and the critical importance of understanding the value your product delivers to customers. He emphasizes that pricing should not just be about features but about the economic, operational, emotional, clinical, and societal value that resonates with different stakeholders. Through real-world examples, Daniel illustrates how a well-structured pricing strategy can lead to stronger, more profitable relationships.

Why you have to check out today's podcast:

• Discover the five key value drivers that can transform your pricing strategy and enhance customer relationships.
• Learn how to effectively communicate value to different stakeholders within a healthcare organization, from CFOs to clinical staff.
• Gain insights into structuring contracts and pricing metrics that align with customer needs and perceptions of value.

"Resist on the discount as much as possible. Look for every other ways to solve it rather than the discount. The discount should always be a last resort and not the first thing you want to deliver or give."

– Daniel Cho

Topics Covered:

02:33 - Daniel's journey into pricing

03:23 - The power of pricing strategy, using segmentation and perceived value to differentiate identical products for distinct markets

06:58 - How two identical products can be integrated differently with existing pricing ecosystems

07:57 - Leveraging his expertise in data analysis to establish Philips' first pricing department

12:11 - Initiating a value-based approach at Philips to create, price, and articulate value

14:22 - Defining value and discussing the 5 key value drivers in a health organization

18:03 - Tailoring value propositions and demonstrating how those four other value streams ultimately lead to financial and strategic benefits

25:22 - An effective sales training Daniel created that teaches salespeople to tailor value-based pitches to different stakeholders' priorities

31:27 - Daniel's best pricing advice

Key Takeaways:

"We cannot continue to sell features and benefits, we have to go and sell value." - Daniel Cho

"If the product is not value-based, you can't ask the salespeople to sell value because you have to start from the product that actually deliver and generate value. So, we started from the product managers." - Daniel Cho

"The first one is economic value. Very simple. Help me to make more revenue or help me to save costs so I have an economic benefit." - Daniel Cho

"The next value is the emotional value. How can we create a better experience for the patients and also their own staff so the staff don't get burnout." - Daniel Cho

"Financial value, although as strong as it is, doesn't resonate with everyone." - Daniel Cho

"Stop giving discounts for free. Always get something back from the customer." - Daniel Cho

People/Resources Mentioned:

• Philips Healthcare: https://www.philips.com/
• Apple Watch Launch: https://www.apple.com/
• Bausch and Lomb Contact Lens Case: https://www.bausch.com/

Connect with Daniel Cho:

• LinkedIn: https://www.linkedin.com/in/danielkkcho/

Connect with Mark Stiving:

• LinkedIn: https://www.linkedin.com/in/stiving/
• Email: [email protected]

This is an Impact Pricing Blog published on October 3, 2024, turned into an audio podcast so you can listen on the go.

Read Full Article Here: https://impactpricing.com/blog/for-b2b-value-is-incremental-profit/

If you have any feedback, definitely send it. You can reach us at [email protected].

Now, go make an impact.

Connect with Mark Stiving:

• Email: [email protected]
• LinkedIn: https://www.linkedin.com/in/stiving/

Lisa Thompson has corporate experience that spans software/SaaS, industrial manufacturing, life sciences/healthcare, medtech, fintech, and B2B services. Together with clients, she delivers unique, actionable solutions tailored to their organizational needs and realities leading to profitable, sustainable revenue and growth.

In this episode, Lisa shares the importance of deeply understanding the economic value your product delivers to customers and aligning it with their buying processes, highlighting that many companies fall short in these areas. Through real-world examples, Lisa shows how uncovering the true drivers of customer satisfaction can transform pricing strategies and lead to stronger, more profitable relationships.

Why you have to check out today's podcast:

• Deep dive into the critical importance of understanding and quantifying the economic value your product delivers to customers so you gain actionable insights to refine your approach.
• Gain valuable guidance on structuring contracts, from incorporating escalators to aligning terms with customer needs, ensuring profitability and flexibility in volatile markets.
• Learn how to evaluate and select pricing metrics that truly reflect the value customers derive, unlocking hidden revenue opportunities.

"In the metric, understand how you currently charge customers. Not the price level, but the price metric. Double check to see if that aligns with whether they get high value or low value. If it doesn't, we don't necessarily have the right metric. There can be magic and a lot of money in getting the metric right."

- Lisa Thompson

Topics Covered:

01:43 - How she ended up in pricing

03:44 - Why value-based pricing is not simply charging higher prices for more value

05:32 - Highlighting the nuances in pricing strategies, explaining ways to leverage value other than higher prices

11:39 - Sharing a lighthearted story about Tom Nagle's amusing moments

13:37 - Emphasizing what many companies struggle to do with deal structuring

16:50 - Explaining why understanding the economic value of a product must come hand in hand with a deep knowledge of the customer's buying process

23:02 - The need for long-term contracts to include appropriate escalators and de-escalators

26:54 - Why contract structures should align with how customers perceive and experience value

30:59 - Lisa's best pricing advice

Key Takeaways:

"Just because value's high, it doesn't mean I can always get a high price for it." - Lisa Thompson

"One of the things I want people to understand in our work is that getting a price premium or charging more than you used to charge isn't the only way to get paid for adding more value." - Lisa Thompson

"We know the value, but that's not the same thing as knowing the buying process." - Lisa Thompson

People/Resources Mentioned:

• Tom Nagle: https://impactpricing.com/podcast/604-insights-into-value-based-pricing-strategies-for-b2b-with-tom-nagle/
• Reed Holden: https://impactpricing.com/podcast/ep97-pricing-in-the-new-normal-with-reed-holden/
• Gilette: https://gillette.com

Connect with Lisa Thompson:

• LinkedIn: https://www.linkedin.com/in/lisa-spadafora-thompson/
• Email: [email protected]

Connect with Mark Stiving:

• LinkedIn: https://www.linkedin.com/in/stiving/
• Email: [email protected]

This is an Impact Pricing Blog published on September 23, 2024, turned into an audio podcast so you can listen on the go.

Read Full Article Here: https://impactpricing.com/blog/pricing-new-products-myth-1/

If you have any feedback, definitely send it. You can reach us at [email protected].

Now, go make an impact.

Connect with Mark Stiving:

• Email: [email protected]
• LinkedIn: https://www.linkedin.com/in/stiving/