Adrian Simmons is the Chief Creative Designer at Elements CPA. He also is the director of Thriveal Laboratory, which encourages innovation in the accounting profession. Adrian worked at KPMG for two years before joining his father's accounting firm. In 2013, he had the honor and privilege to re-imagine the firm.
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How to Switch to Value Pricing
- What is the most important thing you can share about pricing?
- Pricing is dynamic and linked to value, which is also dynamic.
- Do not lock yourself into a fixed number.
- Stay in sync with value.
- Get comfortable with the flexibility.
- There is no mathematical formula; think in organic, human terms.
- Different people have different expectations, opportunities, and impact.
- Do not focus the product; focus on the customer.
- Pricing is human.
- The writings of Ron Baker had a lot of resonance when Adrian got out of school.
- In 2011, he moved into a leadership role and became involved with Ron Baker and Thriveal.
- What is the first step to implementing value pricing?
- You have to be convinced yourself.
- Soak yourself in it by reading Implementing Value Pricing; talk to others who value price.
- Study until you reach a saturation point where you have to start doing it.
- Start with new prospects and apply the new process to them.
- Approach top-tier customers with whom you have a good rapport.
- Ask customers to self-select into levels.
- He worked with the top-tier customers first and then with new prospects.
- He constantly revised his approach through multiple iterations.
- It takes time to get to get comfortable with it.
- What was easy and hard about switching to value pricing?
- The conversation with the right customers became more natural.
- Rooting out assumptions and modifying the systems was more difficult.
- Having the confidence not to react emotionally when the approach does not work for a particular customer was tough.
- What are some beliefs or assumptions you have to challenge?
- Value is tied to time is an assumption you have to break; you have to let go of the security blanket.
- Self-doubt is one of the challenges you have to overcome.
- Other beliefs to overcome:
- The revenue will not be there.
- You will not be able to find the value.
- You have to know everything beforehand.
- Hourly billing is a suboptimal tool to deal with uncertainty.
- Tracking hours prevents us from innovating as quickly as we can.
- Value pricing is a set of tools that is more agile and adaptable.
- Going on a value quest with customers led to changing the product mix.
- What are some techniques you use to manage uncertainty?
- Ask great questions to uncover the unknown.
- Create different tiers to allow the customer to choose.
- You and your customer should mutually build value together.
- Give up the security of the knowledge upfront, but gain confidence in the process to discover value.
- What is the underlying motivation to pursue value pricing?
- Your self-value is usually a good motivator.
- If you treat yourself as an hourly worker, it degrades your self-worth.
- Treat your team better and be honest with your customer.
- Free yourself to charge what you really are worth.
- Your customer will naturally evolve because you will pay attention along the way.
- Financial and emotional motivations are not the same for different people.
- Create more value than you consume.
- Adrian's company had small increases while shrinking the customer base by 30% and increasing their quality of life.
- There is a balance between turning the ship at a slow pace, but keeping the ship turning.
- The company is stronger and more able to address the market.
- What are some resources available to help learn value pricing?
- Thriveal is great if you are an accountant.
- VeraSage is also a great resource.
- Alan Weiss has a different approach, but the core message is similar.
- Mark Wickersham has some materials.
- Blair Enns, Win Without Pitching Manifesto, is great for the creative world.
- Tim Williams has a book, Positioning for Professionals, that provides thought leadership for positioning your company.
- Podcasts
- Plug into the community and start commenting on other blogs.
- If you do not talk to people, it will echo and bounce around in your head.
How to Practice Value Pricing
- What do you say to a customer who is resistant to value pricing?
- Explain the package levels to the customers clearly.
- Let customers get comfortable; give them some time to come around.
- Some customers were not happy, and they parted ways.
- Be prepared; there will be hitches and separations.
- Unemotionally state that you are no longer a good fit, and help the customer find a new partner.
- Where did you get the inspiration for your “Are we a good fit?” page?
- A lot of value pricing is about saying, “For whom are we the right fit?”
- Simon Sinek talked about “What is your puzzle piece?” on a Left-Sider Call.
- Hold your puzzle piece as high over your head as you can, so others can recognize your puzzle piece.
- It is a story, but also an onboarding page.
- Everyone is helping each other, which makes the community grow stronger.
- What are the two most important numbers not on your income statement?
- The two most important numbers are:
- Your customer's imagination.
- Your imagination.
- Do not get locked into the income statement.
- The more powerful economic reality is what is not on the income statement.
- Customer's Imagination: The customer profit is the difference between the value being created and the price charged.
- Your Imagination: Opportunity loss is the difference between what we are not imaging vs. what we could.
- Address the customer's imagination limitations through marketing.
- Address your imagination limitations through innovation.
- See things with new eyes!
- The two most important numbers are:
- Why does an entrepreneur need to experiment in his business?
- Without having some degree of experimentation, it is hard to be an entrepreneur.
- Entrepreneurs are identifying and visualizing a specific pocket of value.
- Discovery, creativity, and innovation are necessarily part of that process.
- Business models were the first topics tackled by Thriveal Laboratory.
- The need to think strategically about business models was a conversation that needed to happen.
- The Business Model Generation is a book on creating new business models.
- Value pricing, as a dynamic system, gives you a model that helps you continue to evolve.
- What is one of your best stories about creating value for a customer?
- A customer connected with them and they thought they were a good fit.
- After a few months, they ended up stepping away.
- They held true to what they were about, by stepping away.
- A customer was going through a life transition and opted for the highest package.
- Over several years, they have helped her build out her plan to retirement.
- It would not have been possible if they had not adopted this new form of business.
About Adrian Simmons
- Website: adriangsimmons.com
- Twitter: @AdrianGSimmons
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