Tennis great Arthur Ashe once said, “You are never really playing an opponent. You are playing yourself, your own highest standards, and when you reach your limits, that is real joy.”
While his comments were specifically about achieving greatness in sports, they also have some application to B2B pricing.
A lot of firms spend a lot of time worrying about what their competitors are doing. They work hard to research the competition’s prices because they use them as a measure of their own pricing success or failure.
But the truth is, your competitors’ prices don’t really matter all that much. You don’t really know if your competitors are pricing their products appropriately or if they are doing the worst pricing job ever. Their products, strategy, target market and tactics are at least slightly different than yours, so what works for them may not work for you.
If you were to take a stroll down any self-help aisle in any bookstore and pick up a book at random, there’s an awfully good chance that somewhere in that book would be a reminder that you can’t control other people—you can only control yourself. What’s true in personal relationships is also true in business: you can’t control your competitors’ prices—you can only control what your firm does.
Every company faces competitive pricing pressure; it’s just a part of doing business. But the amount of pressure you feel and how important it is to your success is determined in large part by your firm’s actions. If you are proactive about doing research, analysis, strategizing, product development, targeting and staff training, your company will likely be very successful–no matter what your competitors are doing.
All too often, thinking about your competitors distracts you from more important stuff. You can’t control what you’re competitors are doing anyway, so a better approach is to focus on improving your firm’s performance—achieving “your own highest standards”—rather that constantly reacting to what others in the market are doing.
This doesn’t mean that competitive analysis isn’t important—it absolutely is. But matching or beating your customers’ prices is a recipe for disaster. Research tells us that very few B2B buyers are really “price” buyers. Most care more about value or relationships than strictly about price. If you focus on doing a good job creating, pricing, marketing and selling products and services that are of value to your target markets, you have a much better chance of avoiding a pricing war and a much greater chance of success.
The webinar “How to Combat Competitive Pricing Pressure” delves into this topic in much greater detail. It explains the strategies and tactics that leading pricing teams are taking in order to minimize the pricing pressure their sales teams feel in the field. And it offers practical tips for playing your own game instead of getting caught up in reactions to forces outside your control.
In closing, we’ll leave you with just one more quote to ponder, this one from futurist Jamais Casico: “Trying to do what your competitors are doing but basically a little bit better is probably not going to be the winning strategy. The problem is finding what your competitors wouldn’t even consider doing.”
How to Combat Competitive Pricing Pressure
What's the best way to manage competitive pricing pressure? In this 4-part training webinar, we share 20 strategies and tactics leading pricing teams are using to anticipate competitive moves, minimize their impact, and respond more effectively.