The art of the deal–customers first, prospects next.

As consumers, we live in the days of Black Fridays and Groupons. We expect products and services to be available at discounted pricing from time to time. On the flip side we are prepared to accept that, at times, we might have paid more than someone else.

In B2B sales, it’s not uncommon for vendors to offer attractive deals as they face the pressure of quarterly and annual targets, or as they try to land marquee customers. Often this results in better pricing, favorable terms, and a larger scope of license for new customers. However, there is a notable distinction between B2B and B2C markets. 

In the B2C world, we accept the fact that, at times, new customers end up receiving better deals. Quite often this is not the case in the B2B world. Existing customers are not too thrilled when they learn newer customers received better deals.

This response from existing customers has an adverse impact on a company in two distinct ways. First, once the word gets out, every new customer starts to negotiate the price down, creating a downward pricing pressure. Second, any attempt to up-sell new products to current customers is met with similar distrust of your pricing.

So, what’s the best practice to avoid this trap? Start with standard and transparent pricing—a model that scales with value realized by the customer. Pick one or two metrics that are most meaningful to your customer and build your pricing tiers on those metrics. An objective approach will allow customers to choose the tier that’s relevant for them and functionality that’s within their budget.

Customer-centric pricing @ Forte

At Forte, we behave as if our pricing is published in the Wall Street Journal. We develop very well thought out pricing models that are tied to metrics the customers value, and implement them consistently across the entire customer base. When a prospect calls their friends and peers to ask about our company (they always do), what they hear is reassuring and demonstrates Forte’s reputation as a trusted partner.

Whenever we develop new products, we work with our collaborators to establish the pricing models and tiers. And the collaborators get the best pricing! This customer first, prospect next approach has created a true win-win for Forte and its customers.