Most CPAs struggle with pricing - some have moved to flat-rate or subscription pricing, and some still bill by the hour. What they often struggle to understand is the full depth of the value they offer to their clients, and because they don’t fully...
Most CPAs struggle with pricing - some have moved to flat-rate or subscription pricing, and some still bill by the hour.
What they often struggle to understand is the full depth of the value they offer to their clients, and because they don’t fully understand value, they are leaving Everest Sized Mountains of Money on the table, which means they have to work a lot harder to compensate for the missed opportunity.
Here today to talk with me about this problem is My guest, Jose Mirabal .
Jose is the Author of the Value-Based pricing framework and the founder and Director of the Pricing Institute, where he has advised more than 1,500 companies in 42 industries on their pricing strategies.
- “What is need based segmentation? It's actually uncovering your market and figuring out and brainstorming the possible needs behind a client possibly buying your products.“
- “When you start seeing the problem from a value standpoint, not from a price standpoint, then things start making sense. That's why need-based segmentation is so helpful. Every single time you uncover needs, it gives you a lot of information.”
- “Needs-based segmentation figures out the who and the transactional analysis tells you exactly how they are consuming.”
- “Sometimes the need has nothing to do with your service, but it has to do with all the other items or attributes that are orbiting around your services.”
- “The secret to pricing is options. It's like a menu at a restaurant.”
- “Uncover your value, but figure your value based on two things. One, what are the needs that the clients have? And two, what are the current options out there that best satisfy those needs?”
- “Everybody's concerned about their costs. Nobody really worries about the price ceiling. The idea is to figure out and uncover value perception to see which specific services that you offer actually might have a higher willingness to pay from clients.”
- “Everybody worries about value but they go down into figuring out costs. And there's no relationship between cost and value.”
- “To monetize value, the first thing you need to do is uncover value. How do you quantify value? You monetize based on differences. When people buy, they buy based on differences. People compare items.”
- “When clients are telling you that your prices are similar or too expensive in comparison to other companies, that's a sign that you probably need to work more on your differences. And that's a sign that you need to better assess how your product and services differ from the next best alternatives.”
- “If you want to do value based pricing, all value based prices are supported by the price of the next best alternative. Every price based on value should be in reference to the next best alternative.”
- “If you want to start with the pricing, don't look for what others are charging as much as what others are offering.”
Podcast Mentioned: [in Part 2]
Impact Pricing Ep125: Can We Really Price Value? with Jose Mirabal
Connect with Jose Mirabal: https://www.linkedin.com/in/jrmirabal/