December 4, 2013
Snowballs actually thrive in pricing. They never melt away, they just grow. Until they break.
In most companies, the pricing function grew out of an administrative necessity. A new product needs a price at launch. Sales needs a discount for a big deal. A spreadsheet is born. A snowball.
The snowball starts small – tended by one person, maybe even part-time. They roll in a list. Then, a volume discount matrix. Then, a price list by region. A small team is formed to keep rolling the snowball.
Leaders in the company start to realize how important pricing is to the bottom line. The spreadsheet is promoted to being a “master” spreadsheet. The team adds margin rules for deal approvals. New discount programs. Analysis of past pricing. Transaction data, pivot tables, charts, macros. The team grows, and manages a whopper of a snowball.
As a kid, I remember rolling snowballs around to get it snowman-sized. They often broke while rolling. I’d shrug it off, mash the pieces back together, roll it a little more. Break, fix, roll, repeat. Works fine for Frosty.
But, your snowball got big because the company realized how important pricing is. In fact, you know there is so much more you can do, you want the snowball to get even bigger. But, the bigger it gets, the more it breaks.
You can’t afford for your pricing to break. And, your goal isn’t really a giant snowball anyway – it is profitable pricing. Top companies are realizing their pricing can’t run on a snowball, and they’re swapping them out for enterprise pricing solutions like Vendavo.
Are you ready to let Frosty go?