What's in the Future of Pricing?
Dr. Jonathan Bein, President — Real Results Marketing
• profit analytics • 2020 Vision • market intelligence • WayPoint Analytics • pricing strategies • industry perspective • change management • Innovate for the Future • innovation • Randy MacLean • distributor sales analytics • Real Results Marketing • Dr. Jonathan Bein • Business Intelligence
Thursday, June 13, 2019—We at WayPoint have made some predictions for the trends of the market over the next couple of years.
#1 Companies are going to start recognizing the value proposition. And as they're doing that work, they'll know what to focus on, communicate, and monetize new things they do within their business, and get better results out of existing habits.
#2 Companies will recognize which customers appreciate that, which customers that have uniquely profitable relationships, and will work harder to protect that. With more of a target on logistics and analytics, companies will be able to be more selective with their customers.
#3 Greater competition and deep discounts will be used as an even more effective weapon by companies that can more confidently identify the accounts that can make massive amounts of money despite a low margin.
#4 Companies will have the wisdom and discipline to intentionally exclude low/no/negative-value relationships by recognizing the drain they would bring from the get go. Some accounts have business models that revolve around draining as much as possible out of suppliers rather than having a mutually beneficial relationship, and the best distributors with the best analytics will be able to dodge those bullets.
More companies are beginning to adopt e-commerce into their business plans, but the revenue increase hasn't been significant. What's important to remember is that once you get into e-commerce, it all revolves back to the value proposition. A likely outcome from this situation will be a culling of the herd, in which the companies that refuse to embrace analytics as a way to run their business will be unable to keep up, and will eventually be eaten up by strong competition.
Seeing how e-commerce tends towards smaller-size orders, the business model supporting it needs to be ultra-efficient. There are certain cost structures we usually employ in our business that simply don't belong there. The picking costs will effect the expenses of each order much differently than in other platforms.
However, with improved analytics, some companies have been able to drastically lower those picking costs to thrive in markets that would otherwise eat businesses alive.
For more information about Dr. Jonathan Bein, visit: www.realresultsmarketing.com