Ask the Expert: Follow Up From September 2012 Webinar
Our latest webinar, “Competitive Intelligence and Pricing”, featured Brian Clarke, VP of Pricing Evaluation at IDC, who described the changing landscape of competitive pricing intelligence and why pricing professionals need more than common data collection tools today. Brian also provided best practices for collecting, analyzing, and making strategic decisions with competitive pricing intelligence. During the live webinar, the audience submitted a number of great questions. Brian’s answers are recapped below:
Q: When competitive pricing information is not readily available on the internet, how do you get that information?
There are scores of information, related to the enterprise for example, that aren’t available on the internet per se. That’s where you want to look inward at what’s coming in from your sales team or do a bid analysis. How did we compare in bids to competitors? Depending on the industry, there may be some third party services that would be able to supply you with additional competitor
Q: How would you approach pricing for enterprise software that is not “retail” based, where prices are not readily available?
There can be three thousand ways to price one particular solution, depending on the lens that it falls under. Where I try to start my analysis is to do research and try to find out how a competitor is pricing their product. It could be a matrix of starting list price and then where they go from there in terms of discounts to particular buying groups, discounts for volume, uplift or downlift depending on geography. Sometimes it’s as simple as a pricing spreadsheet that has different tabs depending on the customer. Sometimes we have to dig deep into distributor sources, and then try to decipher it ourselves. It can be a lot of work, but you can do that to spot a structured price list that helps you make sense of it.
Q: What is a street price and how do you determine it?
There is no single street price, but rather a wide range of what a street price can be. Where we like to start is the “Quantity One” street price, so that’s what you would see on the CDW website or the Best Buy website. It may be the MSRP (Manufacturer’s Suggested Retail Price) in some cases, but that is just one view of what pricing is for that particular product. A street price by definition could also be the transactional price, which could be a discounted price. Whenever we report in our tools as street price, I always state that it is a “Quantity One” street price so that the customer understands.
Q: Do you only look at pricing in North America, or do you look globally?
We look at it globally. You can get crazy with how many markets there are to cover and trying to connect the pricing between the markets because, in many cases products, are configured differently for each market. You have to treat each geography as its own setup and analysis.
