Reimagining Pricing and Sales for Business Resilience
Pricing and sales are deeply connected to each other. Business resilience has never been more critical than ever. Amid and beyond the COVID-19, many companies are reckoning with broken supply chains, abrupt technological shifts and global economic upheaval — an unprecedented storm of disruption that will determine the winners and losers of the post-pandemic world.
In this article, I will discuss what business resilience looks like for enterprise companies moving forward and share how they can achieve this by reimagining pricing and sales tactics.
Ensure Fair Pricing and Sales as eCommerce Prices Gain Transparency
For B2B company leaders, the impending threat of Amazon Business has been a topic of discussion for the better part of a decade. As shops have been forced to close and field sales reps face travel restrictions, eCommerce has fiercely accelerated to a “dial-tone” offering. Companies without a feasible channel for customers to self-serve online went from behind the curve to the last place … seemingly overnight. Of course, getting eCommerce right in B2B requires more than a website that can take orders.
Pricing has become more transparent in the eCommerce era, which is not necessarily a bad thing, but it can make price-setting more complicated. There are many ways, or modes, in which a company may set pricing.
For the publicly visible eCommerce channel, it makes sense to show list pricing, but how do you ensure that each price shown is not lower than the prices you may be offering in B2B agreements?
A customer realizing their “special” price for you is not as good as your everyday eCommerce price creates an awkward customer satisfaction issue!
The downward pricing pressure created by Amazon Business adds another layer of complexity to this challenge. Ecommerce pricing in B2B must strike a delicate balance between remaining competitive enough to attract new business without inadvertently alienating the existing customer base.
To ensure fair pricing on eCommerce channels, with an awareness of ever-changing competitor pricing, cost changes are driven by changing supply chains and the many (MANY!) prices you’ve previously agreed for hundreds of thousands of SKUs across thousands of customers, company leaders should deploy advanced price optimization and management solutions.
The problem’s complexity is simply too much— even for a smart person with a big spreadsheet.
With price optimization, they can ensure that each price set is aligned to the dynamics of each circumstance such as channel, geography, competitive dynamics, customer size, order size, product hierarchy, and more. With advanced price management, pricing teams have the power and flexibility to make real-time market price updates across channels using dynamic data.
Deploy Predictive Sales Analytics & Rebalance Sales Teams
Certainly, COVID-19 has disrupted the traditional sales team balance with respect to inside and outside teams. According to McKinsey, outside or field sales reps are operating more like their inside sales counterparts. The time saved traveling and visiting their top accounts presents a new, reimagined opportunity for this highly-skilled sales team: Deploy predictive sales analytics to turn their white-glove sales style toward the long tail of customer accounts and empower them to treat every customer like a strategic account. This is especially true if you are in an industry where the pandemic has caused a contraction of your market.
Even large players may lower prices to try to preserve what volume they can. Small players may resort to desperation pricing to generate cash flow. Analytics that look across ALL customers and their spend patterns can help you be on the defensive (and offensive!) wherever there’s a material opportunity.
If you have predictive sales analytics in place today, prioritizing cross-sell and recovery insights across the long tail of accounts for outside sales reps is easy to do.
So is cart maximization for eCommerce!
If you do not yet have predictive sales analytics in place, getting started is straightforward and can be live in your business within a minimum of four weeks.
Recalibrate Sales Data to Reflect the New Normal
Of course, data analysis – even analytics predicting what is likely to happen in the future – includes reviewing past data to make recommendations. This is a remarkable time in that the delineation between pre- and post-pandemic may be like night and day in terms of commercial patterns.
In utilizing predictive sales analytics to find opportunities to cross-sell or recover business, comparing customers’ purchase patterns to pre-pandemic volumes will not work. You must calculate the new baseline for each customer as it is likely to be unique and varying by business. Failing to “re-baseline” can result in sending sales teams out to chase volume that no longer exists.
A good solution will allow you to re-baseline as recovery progresses.
Choose a Strategic Partner
Finally, to ensure business resilience in the wake of COVID-19 disruption, choose a partner that is well versed in data science and solving pricing, sales, and related commercial challenges. You can then be well-positioned to quickly deploy the technology necessary to ensure fair pricing across channels, such as predictive sales analytics, and recalibrate your data as needed.
The ideal partner to help solve these unique pricing and sales challenges should be dedicated to addressing the uniqueness of your business and tailor an outcome-focused solution.
Additionally, seek out a strategic partner that strives to deliver continuous value with thorough success plans that maximize value and adoption. Success should include precise measurement of total impact, adoption metrics, margin and revenue drive analyses, pricing opportunity analysis and KPI trends.
While business resilience has never been more critical than now, you can ensure long-term success by adopting new technologies and choosing a strategic partner to deploy multi-channel pricing and sales strategies across your business.