Now that you have successfully created your segments and micro segments, you are no doubt creating content that is educational and delivering that to your targets. With this approach you will be moving them through your funnel and through your pipeline and therefore the next step is to ensure you have the correct pricing for your organization.
What is the best pricing?
Pricing is a difficult subject to tackle. Each vertical can have its own unique pricing and therefore there hasn’t been much standardization across our event industry. What we have done the best is to understand that value-based pricing also takes into consideration what the market is capable of and willing to pay for.
For your event, organization, it’s important to look at your pricing in a holistic organizational view. What this means is do not look at your pricing for booth space, sponsorship, registration, membership all separately as this will create a fragmented approach to your total value proposition. Often times associations and events completely separate their pricing from the different organizational units that make up the association.
Why we have done this, I have yet to understand as the entire goal should be to drive more membership to our organization whether that is through our event or not. Many associations in organizations events are its source of revenue. This is OK and if this is the case there is absolutely an approach you can take to only pricing the value of that events. However 80% of the organizations out there have memberships and events.
With that in mind taking a holistic view will be important as you look to put together your pricing packages and price points for each value that you offer. What is important to note is all of this is driven by value with an understanding of what your current vertical is willing to pay. So, to answer the question what is the best pricing, the best pricing is the one where your value is being consumed by your target segments. How easy it is to convert them to consume your value, is what will ultimately drive you to find the perfect price for your value. If conversions are too easy your price points might be a little low whereas if your conversions are too difficult your price points might be too high.
How to determine the best price?
Experimenting with A/B, testing two different groups of your target segments will help you to determine the best pricing. There will be times when your conversions will be rather easy and of course there will be times when they will be difficult. This is where experimentation plays a large role in order to determine your ultimate pricing.
Determining your goal ahead of time will help in this process. What I mean by this, is your goal to saturate the market through a low-cost solution or is your goal to gain larger dollar price point target clients. Understanding the difference will be key in finding the ultimate price.
Who to ask for help?
Your current clients are great conversation starters in order to help determine pricing. Realistically they will tell you your pricing is perfect because they do not want to have their own increased. To start this conversation out with the correct expectations is important. Ask your clients if they were to be grandfathered into their pricing, what do they think the value you offer should be priced that.
Look at your competitor pricing to also help determine what your pricing should be. Again, understanding your goal whether a low-cost solution or a high cost big ticket solution will help you understand your path when looking at your competitor pricing.
Lastly, your prospects are also great individuals to ask for pricing. This does not mean to ask them directly what your pricing should be, however, it does mean you can ask them in unique ways what they would be willing to pay. This is a great sales tactic for all of those that give you an objection based on budget. Take that pricing with a grain of salt and add a certain percentage to it to help determine the best price.
When should you determine your ultimate price?
Your pricing will change throughout the growth of your organization. As an association your pricing will gradually increase, however, as you look to break into new target segments and some segments as your industry changes, it is important to evaluate whether your pricing is where it should be. So to answer this question, simply put no matter where you are in your organizational cycle you should always analyze your pricing when ever looking to do something new or break into any new vertical.
Wrapping it up
It is very difficult for some to understand their value and the value they provide. Imposter syndrome is not only for individuals. Since human beings make up an organization, an organization is prone to imposter syndrome as well. Therefore there are many organizations who perceive their value to be lower than what it really is. Having an outside evaluation of your value could be the best step for your organization. You could easily start with your internal team and their thoughts to help determine the value you are providing to your industry.
Remember, pricing is determined by three factors:
- Your ultimate goal
- Your industry appetite
- Your total organizational value