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May 13, 2008
Article

New Chart: Should Tech Marketers Hide Prices?

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SUMMARY: Pricing has long been one of the sacred cows of technology marketing … all marketing, really. Companies are uncomfortable releasing their prices when it can scare off a prospect, be matched, bettered, negotiated down, etc. 82% of technology marketers keep their pricing at least “somewhat” confidential -- prospects must reach out to the company.

How is the Internet interacting with this time-tested model? There is evidence that keeping pricing close to the vest may cut companies off from new prospects, hot prospects and may not even have its intended purpose -- giving sales flexibility in pricing.
Chart: Being Upfront About Pricing Can Help Tech Vendors Convert Prospects

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Click here to see larger, printable version of this chart

Being open about pricing is an asset, at least some of the time. 89% of decision-makers were able to recall a purchase when open pricing had a specific impact on the progress of the purchase. However, not all products and services are equal in this regard. The more consideration and cost that a product requires, the less likely it is that having open pricing will be enough to shortlist a vendor. Furthermore, in cases where companies require a rapid turnaround, open pricing can make the sale before you even “meet” the prospect.

Consider this anecdote from a post-survey interview: a growing software company realized the need to upgrade their physical printing of manuals to include full color. They went looking for a printer who could meet their volume and time constraints.

In the words of the Marketing Director: “First of all, every website looked the same, so I couldn’t tell who was big and who was small – they all looked small from their sites. Bad design, no functionality. I tried calling a few to get quotes, sent a few emails and didn’t hear back from some and heard back later in the week from others. It blew my mind – I was looking to give the first decent candidate 25,000 full color books to print in two weeks. Finally, I found a site that had a pricing calculator that got me started, and it turned out that the final price was 5% lower after we haggled a bit. That JavaScript calculator made them a lot of money.”

Remember, with Chart of the Week, our weekly goal is to bring you something useful and interesting in 2 minutes by presenting a bite-sized piece of Sherpa research and the lessons we learned from it. Feel free to post the link or grab the image ... Sherpa's Chart of the Week is yours to use in your blog, presentations or simply for reference.

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Comments about this Article

May 13, 2008 - Jon Dale of Wayfinder Response Marketing says:
I'm not so sure whether it's openness about pricing or being helpful and responsive. Your example makes that point. Today's consumers are trained to be able to help themselves to pricing and product configuration. The printer with the online calculator leverages that experience.



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