Firstly, congratulations on landing your new job - but you know it's going to be challenging, right? The first three months will be a steep learning curve as you absorb information on the company, its personnel and of course historical and current pricing. Every company is different and in a pricing role not only do you have to figure out your company's culture and dynamics, but also their sales processes, their products and sometimes all this in a completely new industry. In order to survive and thrive during those early days you will need to:
Most pricing executives are expected to learn on the job, and you will need to learn pretty quickly to keep up with competition. In order to successfully evaluate the products, promote some ideas of your own and set policies on prices you will need to co-ordinate with production departments and work closely with staff in marketing on appropriate campaigns and promotions. You will learn from them what in the past proved to be successful/not so successful. It's also your responsibility to provide dedicated resources to the sales team to help them identify opportunities, offers that will sell and prices that will win: this includes providing them with the real-time analytical support they need to better position prices and defend value in B2B negotiations.
Develop those interpersonal skills
Are you personable yet persuasive? You will have to quickly build relationships and credibility, particularly with the sales team in order to help them to understand the rationale behind pricing recommendations and the impact on profit margins from price changes.
Carry out research
It's most important to get up to speed with your employer's specific line-up of products and services. If you are new to the industry, a good way to familiarise yourself is by reading about what's happening in that industry. Identify the major trade publications and other relevant news sources and spend some time each day familiarising yourself with the industry. Field research is also important. For example, someone who handles pricing at a supermarket might visit a rival store in the area to check prices. Your role is to keep abreast of rival prices and either beat them, equal them or find an easily explained reason to sell at a higher price.
Always look to be learning
There are plenty of resources available for the aspiring Price Manager, such as The BlackCurve Blog or Professional Pricing Society website to ensure you stay on top of the latest industry thinking. Alteratively, you may wish to check out some speciality books. We have complied a handy list of 8 must read books here, to take your pricing education further.
Talk to your buyers
Your knowledge of the industry is increasing but what about the buyers? Who are these people that are going the purchase your product? Get out there, arrange to meet them. You need to identify the most likely buyers and the specific demographic variables, behaviours, needs and attitudes in order to price correctly.
Speak to the MD
Get a meeting in the diary sooner rather than later. Communication is the key here. If you have a boss who is easy to talk to, great. If the reverse is true, take steps to establish better communications. Discussing your pricing ideas with your boss helps in several ways - you’re showing him or her that you are able to take the initiative, that you’re committed to improving the company, and that you truly want to make a positive contribution. Plus it will give you a better understanding of the company vision and how pricing can support this e.g. Revenue growth, margin improvements, or company image to name a few.
Check how often the prices are updated
As you gain further knowledge of the business you will get a feel for when is the best time to review and possibly raise prices. Depending on the industry, 'testing the water' is advisable before hiking the price – perhaps introducing a price increase for new customers only before increasing prices for existing clients. The success or failure of your business is due in no small part to the revenue generated by correct pricing.
Analyse the historical data
When you set a price that’s too high or too low, it has real consequences for your company in terms of revenue or margins. Look at what has happened in the past and identify the key elements of pricing that affected profitability. When should you 'tweak' the product by bundling or a change of packaging?
Optimise your LinkedIn and Twitter profiles
Your social media profiles are your online reputation so make sure you’re presenting yourself professionally. Build a solid network with reliable contacts but don't try to rush things; when you're just getting started your focus should be on proving yourself to your contacts, not trying to get things from them. Start sharing selective and relevant material. Post on both LinkedIn and Twitter (and any industry-specific forums) so you’re engaging the widest possible network. Basically, get noticed and talked about for all the best reasons!
The journey to pricing success is not easy and it may take some time to establish yourself. The challenge however is worth it; good luck for your future in pricing.
Still not sure of the key responsibilities of a pricing manager? Take a look at this previous article we prepared entitled "11 Principle Responsibilities of a Pricing Manager".
- The Strategy and Tactics of Pricing by Thomas Nagle and Reed Holman. Available to purchase on Amazon here: http://www.amazon.com/The-Strategy-Tactics-Pricing-Profitably/dp/0136106811.