Circa 2008. Pricing… One of the scarier electives at B-School – hordes of assignments starting with a submission on Day 1 ! Add to that, the crazy bidding process and class participation !! Having gone through the Marketing 101 and Revenue Optimisation courses, I decide to give this specialised elective a miss. Over the next few weeks, frustrated faces and painful expressions of my assignment-loaded fellow students reaffirm I made the right choice 🙂
Circa 2012. Or so I thought. 3 people – a designer, an architect and a developer – seem to think otherwise.
“Who, if not the MBA, will be responsible for the pricing strategy of a startup’s first product (if not all)?”
“Well…you know, I’m not a pricing expert you see”, I try to parry. But the tone in their voices makes it clear – if you don’t do it, we will do it. And then you must not complain.
I must rewind to that day 4 years ago and attempt to undo my brilliant decision-making process that is now the scourge of my existence. Sadly though, Steve is not alive to make time-travel-TV a reality.
So it has to be me. Now. Pricing. WaterMum. Ok.
At times of crisis, go back to the basics – someone said that somewhere. What was that about pricing in Marketing 101?? Willingness to pay – aah, yes. Find out what the customer is willing to pay for. Find out what the customer values. God… what do you say to something like that ?!?! ok ok, serious… What does the customer value? Hmm… sounds like our survey results might help here. Ok, let’s see what they have to say.
What do people value?
1. Scientific approach (lends credibility)
2. Non-intrusiveness (don’t remind me in the middle of a meeting; easy to use; least data entry)
3. Smartness (are you just a dumb tracker or are you more than that?)
4. Personalisation (how tailored is the app to my lifestyle and needs?)
5. Joy / Fun to use
6. Privacy :
a. I want to choose what personal information I share with the app/others
b. I want to know exactly how my data will be used by the app
Hmm… ok. So, if people value these, they must be willing to pay for it. That sounds like the right bunch of things to focus on then.
Cool. What next? What about the “necessary but not sufficient” things that people just “expect” from an app? The hygiene factors, without which the above values won’t stand a chance.
Hmm… Let’s see.
What do people expect?
1. Stability (doesn’t crash)
2. Performance (doesn’t make my phone slow)
3. Quality (no bugs)
4. Reliability (works as promised)
Nice. I think that covers what I need. Now, onto a deep-dive. Gotto figure out which parts of the app people are likely to “value” vs “expect”.
PS: Not bad huh, for a non-pricing MBA 😉