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Best Practices Economics Marketing Personal Development Sales

The Challenge of Pricing Disruptive Technologies

This month, I attended a couple of entrepreneur and investor events.  The term “disruptive technology” appeared frequently and prominently – as it should.  What figured less prominently was an understanding of how to capture the value of disruptive technology in the form of price.

If you’re disrupting, you’re delivering value differently….often enabling value differently.  You need to be paid for your creativity…That’s the market imperative. After all, it costs money for a company to build new, highly differentiated value…and the price is how that all gets paid for.

My Lens on the World: Value-based pricing.

Full disclosure: when I call myself a sales, value, and pricing expert, I mean I am an expert on helping companies achieve win-win, value-based pricing.  Customers use price as a comparison point against perceived value. If I can help your B2B salespeople regularly build enough value, customers will have stronger buying preference, at higher prices.

I’ve heard several good definitions of value, but for our purposes, I’d like to use this one:

Value is the desirability of outcomes your products or services deliver to a customer.

This definition gives insight into how value forms and builds in the customer’s mind.  It guides to sales and marketing organizations working to build – then objectively price – a disruptive innovation.

Outcome-based Value Analysis.

Customers don’t buy your offer; they buy their own outcomes/results.  What they are willing to pay for your offer is how strongly they desire results.

Human buying behavior around price is pretty consistent.  Customers:

  1. Compare noticeable differences between options (almost always the top two).
  2. Translate differences into personal and business outcomes. Any outcomes not envisioned are ignored.
  3. Assign value to all outcomes. “Assigning value” can be gut feel, emotional desirability…all the way to a formal analysis of business impacts.
  4. Compare the value of outcomes to the relative prices, and buy according to this calculation

The good news:  This is how customers operate intuitively. It’s no work at all to get a customer to engage in this mental process. Did you ever pay more for gas because a station is easier to get to? How much work went into getting you do decide?

The bad news: contrary to what “rational buyer” economic theory predicts, customers only think as hard as they need to (read those four steps again to see how mental shortcuts could form). It’s not particularly hard to force more detail on their process, it simply takes purposeful selling and marketing effort at the right time.

For established products, salespeople must either walk a prospect through more detail in analysis…or hope that the customer makes perfect value assessments unguided. Hint: they almost never do. I have a secure income helping “established product/service” companies sell at better prices.

For disruptive products, value-building must be even more purposeful. Each customer is walking an unfamiliar path.  They require more detailed guidance all along the way: comprehending novel outcomes, envisioning those outcomes for themselves, belief/confidence in realizing outcomes, valuing outcomes, and more.

Penetration / Skim pricing: a Myth?

The Internet age has introduced us to the idea of buying profitless market share and figuring things out later: penetration pricing is the new false idol of business.

You can — and people do– price disruptive technology for profitable penetration.  The key:  be in a winner-take-most (WTM) market.  Only buy market share in WTM markets….and either have deep pockets or patient money.  Any company bringing a disruptive offer to a normal market is at risk with a penetration pricing strategy.  You’re far more likely to end up as roadkill than as the next Amazon.

As long as your price is less than your value, the idea of charging less to sell more is a myth (the topic of one of my most popular posts ever).  The demand curve you learned in econ class is based upon several unrealistic assumptions – assumptions made so that the math works more easily, not to explain real-world buyer behavior. For one thing, the math assumes little to no differentiation.  In contrast, the whole point of disruption is differentiation.

Pricing Is Profit

Regardless of the price you charge for a piece of business, your production costs don’t change.  That means that an additional price dollar is a bottom-line dollar.  Conversely, every dollar you don’t charge (or discount away) is a profit dollar you just donated to a customer.

Those profit dollars?  You need them for disrupting, innovating, customer education, etc. Whether you do subscription pricing (or its economic cousin, leasing), or whether your offer involves Uber-style distributed asset ownership (or its economic cousin, franchising)…understanding who receives what outcome/value is the key to a successful pricing strategy.

You Can’t Price The Value You Haven’t Built

If your disruptive offer generates value, you need to have a system for causing that value to come into being in the customer’s mind.  In consumer markets, this might come via media-delivered content.  In a complex/consensus B2B environment, the mix will shift to include more human-to-human value-building customer conversations: that’s my thing.

Disruptive Change and Value

Value only exists in a customer’s mind.  Value for something disruptive often involves a little more commercial teaching work — getting a customer to wrap their mind around a novel outcome.  Unless the outcome is unusually intuitive, that takes some sort of value building communication. That value building is rewarded by a higher, value-based price.

I hope this helps.  If you’d like to talk in greater depth, please feel free to reach out. Also, I’d appreciate your liking, commenting, or sharing with your networks, or with colleagues who it might resonate with.

To your success!

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Best Practices Body Language Entrepreneurship Human Resources Management Marketing Negotiations Sales Women In Business

“7 Micro-Expressions You Need To Know – Negotiate Better” – Negotiation Tip of the Week

“Reading micro-expressions can help avert crises. But only if your interpretation is accurate.” -Greg Williams, The Master Negotiator & Body Language Expert (Click to Tweet)

 

 

Click here to get the book!

“7 Micro-Expressions You Need To Know – Negotiate Better”

A pale expression held his face. Holy ‘blank’ was the four-letter word obscenity he uttered. We’re in a full-blown crisis! Dumbfounded, he said, what are we going to do now? We have to negotiate with them! His associate said, let’s meet with our adversaries. We can read their micro-expressions during the meeting to gain insight into their real thoughts and feelings. That’ll allow us to know what’s really on their minds.

Do you know how to read micro-expressions? Do you know what they are? Continue reading, and you’ll be able to answer both of those questions. Plus, you’ll discover how you can use them when you’re in a crisis.

 

Micro-expressions:

Micro-expressions are emotional displays that last for less than a quarter of a second. They reflect the reality of someone’s thoughts at that moment. Hence, if you’re able to interpret someone’s emotional displays accurately, you’ll have insight into their current emotional state. Doing that will give you insight into how they feel about an offer or statement. During a crisis, having this insight gives you real-time information about the direction you should take.

There are seven micro-expressions generic to everyone throughout the world

  • Fear – When detecting genuine fear, look for raised eyebrows, widened eyes, and parted lips with the bottom lip protruding downward.
  • Anger – Anger is denoted by lowered eyebrows and flaring nostrils reminiscent of a bull before charging.
  • Disgust – This micro-expression is displayed by the upper lip turned up, while the nose is wrinkled.
  • Surprise – You’ll recognize surprise through raised eyebrows, wide eyes, and open mouth.
  • Contempt – This gesture appears as a sneer. You’ll note it by one corner of the mouth turned upward.
  • Sadness – Note sadness through drooping eyelids and downturned lips. A change in voice inflection and tonality may also accompany genuine sorrow.
  • Happiness – Happiness is shown through wide-eyes with crow’s feet or wrinkles at their corners, a smile, and raised cheeks. A degree of exuberance may also accompany this gesture.

 

Using Micro-expressions In Crisis Intervention

Knowing someone’s real thoughts allows you to understand their source of motivation – and that’s the benefit of being able to read someone’s expressions.

During a crisis, use the unannounced information you’ve gathered and assess how strong the opposition is. From there, determine the degree of mental or real force to summon. Another plus is the ability to evaluate the commitment that those on the opposing side have to one another. Accordingly, if you can identify those with less alliance, you may be able to separate them from the others. Therefore, you’d be weakening their numerical strength, which may assist in decreasing their overall power.

Once you’ve gathered the mentioned insights, consider different ways to use them to your benefit. As an example, you might:

  • create false scenarios to confuse the other party per the direction they should take
  • align some of your stronger positions with their weaker ones (do this to keep their stronger points at bay) – then you can state that you’re trying your best to meet their needs
  • form a splinter group, consisting of those from your side, theirs, and neutral stakeholders to combat the overall strength of the opposing party – this maneuver is akin to divide and conquer, with the benefit of your team becoming stronger, while their’s become diluted.

 

Feigning Micro-expressions

While genuine micro-expressions give insight into one’s mind, you can fake them. As an example, you can exaggerate contempt by turning one corner of your lip up and allowing it to linger longer than a micro-expression. Even if the other person didn’t initially observe your expression, you could ask if he saw what you’d done. Regardless, you’ll have him on the defense by asking questions and him answering them.

 

Confront With Caution

There’s nothing more daunting than sizing up an adversary and not identifying its true leader. That means you must be hyper-aware of who your real opponent is and the decision-making abilities they have. You’ve heard about the power behind the throne. Even more so during a crisis, that’s who you want to confront. Your rivals may have a shared leadership structure or using a front-person as the face of their team. They’d do that to confuse you.

To identify a power source, observe who might look at whom for confirmation before making or accepting an offer. You can also detect subtle signals per the hesitation in committing that act. That’s where your observance of micro-expressions will lend assistance in identifying a person fronting as one possessing power.

 

Reflection

Being able to identify and interpret micro-expressions accurately will give you an enormous advantage in any situation. During a crisis, having this skill will magnify your power exponentially. So, if you use this ability wisely, you’ll deter and avert more crises … and everything will be right with the world.

 

Remember, you’re always negotiating!

 

Listen to Greg’s podcast at https://anchor.fm/themasternegotiator

 

After reading this article, what are you thinking? I’d like to know. Reach me at Greg@TheMasterNegotiator.com

 

To receive Greg’s free “Negotiation Tip of the Week” and the “Sunday Negotiation Insight” click here http://www.themasternegotiator.com/greg-williams/

 

 

#Expressions #Micro-expressions #crisis #Negotiations #Control #Conversations #NegotiationStrategies #NegotiationProcess #NegotiationSkillsTraining #NegotiationExamples #NegotiationTypes #ReadingBodyLanguage #BodyLanguage #Nonverbal #Negotiate #Business #SmallBusiness #Negotiation #Negotiator #NegotiatingWithABully #Power #Perception #emotionalcontrol #relationships #BodyLanguageExpert #HowToNegotiateBetter #CSuite #TheMasterNegotiator #ControlEmotions #GregWilliams #success #negotiation examples #Negotiation strategies #negotiation process #negotiation skills training #negotiation types #negotiation psychology #Howtowinmore #self-improvement #howtodealwithdifficultpeople #Self-development #Howtocontrolanegotiation #howtobesuccessful #HowToImproveyourself

 

 

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Best Practices Growth Industries Management Personal Development Technology

This Is What Business Leaders Must Do (Part 2)

Now that I’ve revealed what business leaders must know in order to become the disruptor instead of the disrupted, the next step is applying those principles. I discussed previously the need to solve problems before they occur; however, what happens when you do uncover a problem?

Whatever it is, you have to take that problem and skip it, because that problem is not really your problem. The key to unraveling your organization’s most intractable problems often lies in recognizing that the problem confronting you is not the real problem, just what you think the problem is.

Consider Elon Musk and Tesla. During the company’s inception, Musk funneled millions of his own money into Tesla to jump-start manufacturing. When creation, testing, and everything was moving slower than expected while pre-orders for a Roadster stacked up, he had to funnel even more of his money into the company, nearly bankrupting himself. Tesla wasn’t just facing one big problem; their problem was multiple problems! Batteries would overheat and burn, cars would fail safety testing; you name it, it happened.

However, Musk and the Tesla team decided to skip those problems, realizing their real challenge was bringing fully electric cars to market. So employees focused on making sure the vehicles ran safely and got them to market, later debuting sedan models in addition to sports cars to make the very concept of electric vehicles appealing to the masses.

Like Tesla, if you look at your problem from different angles, you may well find that it is not your true problem, and rather than trying to solve it, you fare better by skipping it entirely. 

Go opposite (Follow the path less traveled)

When searching for the real problem you want to address, it’s not always easy to know where to look. A great way to harness your anticipatory abilities is to note where everyone else is looking and then look in the opposite direction. Uber looked at how traditional taxi cab companies operated, where individuals ride in vehicles and have to stress about how to split the cab fare with friends or worry if their cab driver took them on a joy ride in an unfamiliar area to increase the final bill.

By Uber essentially making the ride a flat fee from the start, it takes away a lot of stress, not to mention using your mobile device to call a personal driver to your pickup location and eliminating having to hail a cab amongst everyone on the street.

Redefine and reinvent (Identify and leverage your uniqueness in new ways)

Change is the only constant, so you can’t rest on your laurels doing what you’ve always done, even if you do your best to keep doing it better. The only way to survive and thrive is to continuously reinvent and redefine everything.

Reinventing oneself has always been a powerful strategy, but in the past, corporate and product reinvention was an option. Today it is imperative. In the past, stability and change were two contrasting states: when you achieved stability, you did so despite change. Today change itself has become an integral part of stability: you achieve stability by embracing change as a constant.

Beat the competition by redefining anything and everything about your business. Additionally, decommoditize continuously by looking for creative ways to transform the ordinary into the extraordinary.

Direct your future (Or someone will direct it for you)

Anticipate the future to direct your future. Becoming more anticipatory starts with seeing the certainty of hard trends that will happen and making strategic moves based on them. Additionally, observe soft trends as factors you can influence to shape a better future. But it’s not enough to simply heed what I’ve discussed thus far; there is something more all-encompassing. You must actively shape your own future.

Directing your future is your creative capacity to envision and rewrite your future. You become what you dream, so if you want to know what you are becoming, ask yourself what you’re dreaming. This is a vital piece to becoming anticipatory. Anticipation puts a powerful strategic tool in your hands, giving you the control of your own future.

Chart Your Course

Anticipating the future is key to successful innovation and, more importantly, helps you become the disruptor and not the disrupted. If you want your organization and industry to be disruptive, then it is imperative for you to observe the hard trends shaping the future and help shape your organization’s future. By committing to these principles and plans of action, you and your organization will stay ahead of the curve and find a solution before the rest of the world sees a problem.

Categories
Growth Management Personal Development

WHEN is Leadership Coaching a Good Investment?

There is one reason to invest in coaching – to develop the capacity of leaders who are responsible for growing the business, enhancing the brand, developing and retaining talent, and getting results.

John Maxwell, many times over a best-selling author on leadership, is spot-on when he says, “Experience is not the best teacher. Evaluated experience is the best teacher.” Effective coaching helps leaders evaluate and develop their skills in real-time to increase their capacity to lead. My wife would likely say, “Great point Captain Obvious.” OK, fair point. So maybe a better question is when should companies make the investment?  While every leader would benefit from coaching, no company has unlimited funds. These four scenarios represent the best investments in leadership coaching.

High-potential leaders. These leaders are the company’s future leaders. Coaching and developmental assignments are important parts of the succession planning process. This developmental coaching is an investment in the company’s future with a longer-term ROI. The key objective is the leader is ready when the company needs them to step-up.  I’ve personally witnessed companies waste time and money keeping underperforming leaders because the next leader wasn’t ready.

Talented leaders with a serious skill deficiency. We are all human. Even the brightest, most talented people can have a skill deficiency that is potentially derailing. You’ve seen the many examples. They can be too hard on people. Too easy on people. Don’t hold people accountable. Poor listening skills. Lone wolf / poor collaborator. Ineffective communicator. Too self-promoting. Can’t relate to a different generation. Unfortunately, these issues are often overlooked or simply tolerated until the collateral damage is too high. This is a poor business strategy that does a disservice to the leader, their teams and the business. Human Resources managers know who these leaders are and can add value by alerting senior leadership to the risks along with a solution. Coaching can be a smart investment that heads costly issues off at the pass.

Recently Promoted Leaders. Think new Presidents/Vice Presidents/General Managers/Directors. Being elevated to these new levels brings many challenges, particularly in the first year. It is a steep learning curve with new responsibilities, new relationships to build, new customers to serve and more pressure to perform. Success in previous positions do not guarantee success in the new position. Supporting newly promoted leaders with effective coaching can help smooth the learning curve and minimize risk to the organization. Coaching fees are a rounding error compared to the budgets these leaders are responsible for.

Senior Executives Leading Change. We have never seen such a dynamic environment as we are seeing now.  Political unrest, a pandemic, disruptive technology, and a changing workforce.   Leading change is difficult under normal circumstances.  Having an experienced coach as a sounding board can be helpful in navigating this white water trip.

Dr. Mark Hinderliter is a Veteran-Owned Business Owner that works with companies to develop their twin superpowers:  Leadership and Culture.  Mark’s experience as a senior leader for a billion-dollar global enterprise along with a PhD in Organization and Management are a unique fusion real-world leadership and academic credentials.

 

 

https://c-suitenetwork.com/advisors/advisor/mark-hinderliter-phd/

Categories
Growth Management Personal Development

Why Strong Leaders Are Never Afraid to Ask for Help

For some company leaders, the experience of saying the words, “Could you give me some help on this” feels as uncomfortable and unfamiliar as putting on a new pair of shoes. Some leaders are too shy to ask for help. But the bigger issue for many company leaders is that they fear that they will appear incapable, unintelligent or even helpless. One company leader expressed her reservations to me this way, “People expect me to know all the answers. If I ask for help or even suggestions, people are going to think that I don’t know how to make the best decisions for our company.”

I have led a number of organizations and I have a totally different take on this issue. I am convinced that people feel validated and appreciated when I ask them for help. I also believe that people typically enjoy giving help, because we all naturally feel good about helping others.

But there are many other benefits too, including these:

  • You discover strengths and abilities in other people that you might have missed in the past.
  • You cultivate a stronger, braver and more balanced team.
  • You enable people to do more of what they do best, which makes them happier on the job, reduces turnover, improves productivity and pays other unexpected benefits.
  • You establish a healthy atmosphere of give-and-take. When someone helps you, they sense that you “owe” them a favor and are more like to ask for one in return.
  • You show that you do not think you are perfect, which shows that you are a confident leader, not an arrogant one.
  • You free more of your time to manage top-level responsibilities like long-range planning, defining your company’s vision and mission, cultivating new business, and just plain thinking about the biggest issues and opportunities that lie before you. This could be the biggest benefit of all.

Asking for Help Builds Healthy Give-and-Take

After I have asked for help, I often go on to say, “Please feel free to ask me for help if you ever need anything.” Even if I don’t say that, people know they can ask me, because I have established a pattern of being helpful. And I think my efforts have helped build deeper relationships and greater organizational success.

An Experiment for You to Try . . .

Over the next few days, consciously take time to ask people for more help. Consider their reactions. And over time, evaluate how your relationships with those people have improved.

I’m not suggesting you ask for help just for the sake of asking for help, or just to make people feel good. When you do need help, however, don’t shy away from asking. People will appreciate you more. When you ask people for assistance, you demonstrate that you respect their expertise and effort. That will help create a stronger bond between you and those around you and build a much stronger organization.

About the Author

Evan Hackel, the creator of the concept of Ingaged Leadership, is a recognized franchising expert and consultant and successful businessman. Evan is also a professional speaker and author.

Evan is Principal and Founder of Ingage Consulting, a consulting firm headquartered in Woburn, Massachusetts. A leader in the field of training as well, Evan serves as CEO of Tortal Training, a Charlotte North Carolina-based firm that specializes in developing and implementing interactive training solutions for companies in all sectors. To learn more about Inage Consulting and Evan’s book Ingaging Leadership, visit Ingage.net

 

 

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Entrepreneurship Management Marketing Negotiations Sales Skills Women In Business

“Are Myths About Supremacy Destroying Your Life” – Negotiation Insight

 

“The myth about supremacy is, it is a myth. Because everyone’s insights add value to the whole, even if their insights detract from the thoughts about the superiority of others.” -Greg Williams, The Master Negotiator & Body Language Expert (Click to Tweet)

 

Click here to get the book!

 

“Are Myths About Supremacy Destroying Your Life”

 

Don’t allow the supremacy myth to destroy your unrealized opportunities due to the way you think.

We don’t need their input. We’re superior in every way to them – said one associate to the other. So, they entered into a bargaining session with those they assumed were inferior, and became obliterated! Since they went into the situation with a superior mindset, they’d not considered options that might have improved what became their dismal outcome. They didn’t prepare appropriately per thoughts they should have pondered. And that was to their detriment.

Continue reading, and you’ll gather insights to improve your interactions with other people. Because, even if you don’t define yourself as having myths about others, others have them about you. And since everyone is codependent upon each other, ignoring this illusion can prevent future advancements in thinking for you and them. Without that improvement, everyone will advance at a slower pace.

 

Impact of Thoughts

As someone of authority, have you considered how myths impact your life? If your first thought was, I don’t think others are inferior – you should reconsider your belief. Everyone considers himself above others in some cases. You may view the disheveled homeless person, the ticket-taker on the train or those in other environments to be inferior. The point is, recognize your reality for what it is. From that point, you can begin to deal with your version of the myth. That’s important because that myth might be hampering the advancement of your life based on the way you think.

 

The Problem With Supremacy

Thinking you’re superior to others taints your mind. It affirms misconceptions that you possess that may hamper your interactions with others. And that can place you at a disadvantage when you’re trying to sway someone to adopt your position. Worse, you’ll lose time and attrition on aspects that might have otherwise advanced that position.

Always be aware of what you say about the abilities of others. And be more aware of the inner thoughts you possess about such feelings. Because that’s the message you’ll project in the way you act towards them.

 

Identifying Your Fears

Fear may be driving your beliefs about your supremacy. If so, are you aware of what you fear? The point is, you should examine why you hold such views to be truths if you do. Because you’re alienating yourself from those that you may use as allies in a best-case scenario. In a worst-case scenario, you’re turning them into adversaries.

By identifying your source of motivation, you’ll have a point from which to address your supremacy challenges. That will allow you to shift your mind, which will lead to self-improvement and your positioning with others. That means the more open you are to their viewpoints, even if you don’t initially agree with them, the better your chances will be of understanding their perspective. From there, you’ll become more sensitized, which should place you and them on a better road of consideration, which should lead to better outcomes.

 

Reflection

When you’re in any role, leadership, or non-leadership, you must possess top-of-mind awareness of how you view people. If you consider others to be inferior, you’ll attempt to cast that demeanor upon them. Some will resist, and others will fight you for the insult you toss their way. That can dampen your position and make it more challenging to deal with them.

People see the world differently. That’s due to the experiences and environments they’ve encountered. Therefore, if you wish to improve conditions in a situation, consider availing yourself to the thoughts and opinions of those that don’t come from your background, and those that haven’t shared your experiences. Having their added viewpoint will allow you to see conditions from another perspective. It will also open the spectrum of new opportunities. Those will become the opportunities that will increase the chances of improvement for everyone involved … and everything will be right with the world.

 

Remember, you’re always negotiating!

 

Listen to Greg’s podcast at https://anchor.fm/themasternegotiator

 

After reading this article, what are you thinking? I’d like to know. Reach me at Greg@TheMasterNegotiator.com

 

To receive Greg’s free “Negotiation Tip of the Week” and the “Sunday Negotiation Insight” click here http://www.themasternegotiator.com/greg-williams/

 

 

#Supremacy #life #Myths #Negotiations #Control #Conversations #NegotiationStrategies #NegotiationProcess #NegotiationSkillsTraining #NegotiationExamples #NegotiationTypes #ReadingBodyLanguage #BodyLanguage #Nonverbal #Negotiate #Business #SmallBusiness #Negotiation #Negotiator #NegotiatingWithABully #Power #Perception #emotionalcontrol #relationships #BodyLanguageExpert #HowToNegotiateBetter #CSuite #TheMasterNegotiator #ControlEmotions #GregWilliams #success #negotiation examples #Negotiation strategies #negotiation process #negotiation skills training #negotiation types #negotiation psychology #Howtowinmore #self-improvement #howtodealwithdifficultpeople #Self-development #Howtocontrolanegotiation #howtobesuccessful #HowToImproveyourself

 

 

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