It’s easy to be convinced…
…in these roller-coaster economic times…
…that price is the dominant factor in a clients decision to stay with you or leave you for a more cost effective option.
If you have been convinced price is the big issue, you’re wrong! Very wrong!!!
Accepted, price is always (and always has been) an important factor in the decision making process when buying anything – including accountancy services.
Accepted it is currently playing a more prevalent role, except for books on pricing!
Would you buy a cheap book on pricing strategies that work?
The book: Hopefully you’ll agree that it’s reassuring that a 215 page book on ‘Smarter Pricing’ (by Tony Cram) is not £7 or even £12 or even £18.
It cost me £28 which is at least double what I’m used to paying for a book through Amazon (It’s currently £24.99 if you’re interested after reading this)!
It’s a good book – what stands out for me, having read it twice now is this…
In addition to price there are two other parts of the decision making process (not price) that play a role in determining value-for-money (VFM).
Two parts that should never be underestimated.
Two parts in which you have substantial influence and control and can take action on:
1. The perceived product benefits offer – or rather, the service benefits offer for accountants
2. The perceived emotional associations – the emotions that matter to the buyer such as certainty; safety; confidence; optimism; credibility; care; and so on
This means that, as well as considering pricing tactics for your firm during the current economic melee you must also consider the following four strategies:
1a. working on improving the ACTUAL product offer
– add an easy pour spout to a bottle of juice improves the benefits of the juice experience – add a ‘management accounts debrief’ to your management accounts service that highlights the key issues and what could/should be done – upgrade the presentation of your annual accounts so that it’s easier to see the key underlying issues facing the business with recommendations on what to consider – speed up delivery of your annual accounts service so that they are more timely and relevant to your client – offer a payslip home delivery service to your payrole service rather than just sending the batched payslips to your business client
1b. working on improving the PERCEIVED product (service) offer
– add the scent of lemon or lime to industrial cleaning fluids raises the perceived cleanliness and therefore the value of the product – raise the quality of the paper of your annual accounts packs or add a cardboad back so that it feels more substantial – add a follow up phone call to every substantial piece of work (annual accounts, management accounts, forecast) to check they’ve received it OK and wether they’ve had chance to read it. Then arrange a discussion with a partner/manager to discuss any queries. – add additional points of contact throughout the year to discuss meaningful/worthwhile/relevant issues with your most valuable clients
2a. working on improving the ACTUAL emotional credentials
– KitKat is associated with taking a break, champagne is associated with celebration – establish a flow of information that proves that you are perfectly on top of all the possible tax breaks/savings available to your clients – establish a flow of information that proves you want to help their business succeed – agree crystal clear deadlines for work and hit them (or beat them!) – additional points of contact has emotional associations (demonstrates you care) as well as being of practical benefit to your client
2b. working on improving the PERCEIVED emotional credentials
– First Great Western Train managers make announcements alerting customers to on-time arrivals – making clients aware of the monthly feedback scores you get from clients reminds them that you are good at what you do – sharing success stories about your clients reminds them that you are valuable adviser to have on their team
Are you now ready to accept that you have some control over the ‘value-for-money’ equation in your firm? Will you change the way you charge for your services?
…you can now influence whether your clients stay or go, and you can start to consider the ways and means of improving your perceived value-for-money.
You can see there are four strategies and potentially dozens of tactics available to you – where do you want start?
1. Start by making a person responsible for improving VFM – someone senior
2. Then make them accountable every month for improving VFM through innovation and renovation of your existing services.
Remember, you can influence and control the perceived VFM – but only if you take persistent action.
Go on then, get on with it!
Who are you making responsible for VFM in your firm?
PS If you want to order the book click here
PPS For more on pricing click here