Strategic Pricing for the Training Industry Paul Terlemezian Twitter: iFiveAlliances August 12, Code: #

Commitments to Action Relevance What to do? What obstacles to overcome? What you will do to overcome the obstacles? Accountability When will you begin to do this? What will motivate you to complete this action? How will you know you have been successful?

Think, Talk, Type & Tweet Time Think Introduction (talk) Why are you attending? (talk, type) Why am I offering this for free? (talk) Questions and Comments (chat, tweet #stratprice, Ning site)

Today’s Outline Why do we have a price for our offerings? Tactical vs. Strategic Pricing The Bermuda Triangle of Pricing Establishing a Pricing Discipline Differentiating Your Offering Break Commitments to Action (and tools to help you)

Why do we have a price for our offerings? What impact does price have on the learner/purchaser? What impact does price have on the trainer/provider? LinkedIn Group: Free Training Discussion Questions Part 1: Purpose of price to learner/purchaser Part 2: Purpose of price to the trainer/provider

Tactical vs. Strategic Pricing Tactical (2-4 times per hour of the labor cost) 1. Cover costs (hinders growth) 2. Achieve sales goals (undermines profits) 3. Competitive advantage (diminishes value) Strategic 1.What is the value to the client? (enables growth) 2.How much of the value do you provide? (increase profit) 3.What is the client’s buying attitude (price, value, risk aversion) (increase focus on value)

The Bermuda Triangle of Pricing Competitiveness (do nothing, do it themselves, buy from competitor, buy from you) Profitability (For you and for your client) Value (How does your client achieve what you offer? Why will they be better off with your services?)

Establishing a Pricing Discipline Discipline of Market Leaders (Treacy and Wiersema) Operational Excellence (low margin – high volume) Product Leadership (high margin – low volume) Customer Intimacy (high price – low volume)

Differentiating Your Offering 1. Capabilities 2. Risk Mitigation 3. Terms and Conditions 4. Convenience 5. Intangibles 6. Price

A Value Model 1. What to do 2. How to do it 3. Doing it 4. Getting the desired results 5. Sustaining the results

“Tools of the Trade” 1.Strategic Positioning 2.Moments of Need (Mosher/Gottfredson) 3.Setting the Table (i.e. Earning a Seat at the Table) 4.The Training Grid SM 5.An ROI Model (Value for the Client) 6.Project Management

Break

Commitments to Action Relevance What to do? What obstacles to overcome? What you will do to overcome the obstacles? Accountability When will you begin to do this? What will motivate you to complete this action? How will you know you have been successful?

Strategic Positioning Other Party Interest DecisionRoleAttitude Product (traditional) PriceDependablePrice Process (consultative) Total CostConsultantRisk Aversion New Value (collaborative) ProfitExpertValue Copyright 2009 iFive Alliances, LLC

Moments of Need Mosher/Gottfredson (remember the GPS) 1.Learning for the first time 2.Wanting to learn more 3.Trying to remember and/or apply 4.When things change 5.When something goes wrong

Setting the Table for Success Business Driven Initiatives Technology to Support Initiatives “Big Picture” Model

Business Drivers Functional Management Performance Consultant AssessmentAssessment ASSESSMENTASSESSMENT ROIROI MEASUREMENTMEASUREMENT Content Tools Prerequisites, Retention, Performance Support Copyright 2007 iFive Alliances, LLC

The Training Grid SM Decision MakersManagersDoers Prerequisites789 New Content621 Reinforcers543 Copyright 2007 iFive Alliances, LLC

An ROI Model FundsDescriptionROI Alignment Customization Implementation Assimilation Self Sufficiency Sustainability = Relevance x Accountability Copyright 2007 iFive Alliances, LLC

Commitments to Action Relevance What to do? What obstacles to overcome? What you will do to overcome the obstacles? Accountability When will you begin to do this? What will motivate you to complete this action? How will you know you have been successful?

Questions and Answers?

Inspire Confidence in Others Believe in Your Value to Them Articulate Your Value to Them Prove Your Value to Them (try it in the reverse order) ( What to do?)