Product and pricing: Busy all year, and the margin hasn’t moved.

Contact me See what I take on

A US luxury furniture retailer, customers who came back

4%: came back to buy again, when we started

18%: came back once the business behind the ads was rebuilt

Read the case

Evidence

What changed when the product and the price did.

3×
bigger average order at a furniture retailer, once the business behind the ads was rebuilt
LA Furniture (VIG Furniture)
2 days → 4 hrs
to send a customer a price at a packaging maker, with the promise on the website
Nadrukuemo
~2,000
units of a brand-new product sold in three months, in three countries
Artopad

Owners usually write to me when one of these happens.

You know the product could be better. You don’t know which part
Your best-selling thing might be your worst-earning thing
You sell one thing, at one price, and the customer buys once and disappears
You haven’t raised a price in two years and you’re not sure you can
You want the business to be sellable one day and it isn’t packaged for it

The product customers buy most may earn you the least.

What each thing earns once the cost of delivering it is in is where the surprises are, and they are usually large.

How I run it

Work out what each product earns after delivery
Do the same by type of customer
Mark what sells well and earns badly

A furniture retailer asked for better ads. The money was leaking somewhere nobody was looking, and fixing that first tripled the average order.

You don’t know why the last ten said yes, or no.

Price is rarely the reason people give, and rarely missing from the real one.

How I run it

Talk to recent buyers and recent losses
Write down what each compared you with
Find what would have changed the answer

One product, one price, and the customer buys once.

The expensive part of any sale is the first yes, so the next sale should be easier.

How I run it

An entry offer somebody can say yes to
The core product
Something to sell the customer who already bought

You haven’t raised a price in two years.

A price rise should be a decision you can explain, not a hope.

How I run it

Set what to charge, checked against what you know about demand
Decide what happens if it moves
Where it matters, package the business so it can be sold one day

How it runs

Three to five weeks, depending on how many lines there are.

01Free first call
02Margin and buyer interviews
03Ladder and pricing
04Decisions with owners and dates

Price: Priced after the first look, because the number of products and markets changes the work materially.
You bring: Prices, costs to deliver, and margin per line if it exists
Recent won and lost deals, and why each went that way
Whoever owns the product decisions today
Not this: A brand exercise disconnected from the price list.

Questions owners ask first.

What do I end up with?

Margin by product, by service, and by customer type
What to charge, and what happens to demand if you do
The ladder: entry offer, core, what a happy customer buys next
What to build, what to drop, and what to leave alone

You end up knowing which product earns, what to charge for it, and what to sell the customer who already said yes.

What do you need from me to start?

What you sell now and at what price
What each thing costs you to deliver
Who bought recently and why they said yes

When would you turn this down?

A brand exercise disconnected from the price list.

Building the product. I decide what it should be; your team builds it.

How long does it take, and what does it cost?

Three to five weeks, depending on how many lines there are.

Priced after the first look, because the number of products and markets changes the work materially.

Why does this matter?

For the average company studied, a 1% improvement in price produced an 11.1% improvement in operating profit — more than the same improvement in volume or in variable cost.

Price is the fastest lever on the profit line and the one owners touch least. That is why it gets looked at before anything is added to the range.

Source: Marn and Rosiello, "Managing Price, Gaining Profit", Harvard Business Review, September 1992. Read the source

How does it start?

With a free first call of about an hour. Bring what is happening and any numbers you trust; if this isn’t the right domain, I’ll tell you on that call.

Show me your price list.

Send what you sell, at what price, and roughly what it costs you to deliver. I’ll tell you where I’d look first.

What I’ve written on products and pricing.

More work in this domain

Artopad
A product nobody had ever bought, launched into three countries on $10,000 total, sold out in three months.
LA Furniture (VIG Furniture)
Average order value went from $240 to $760 after we stopped working on the ads.
Intempo
Stopped speaking HR-tech, started speaking founder, and demo bookings went up 52% in four weeks.
DIS-AI
Forty owners said yes before a line of code was written, and eight committed to use it.
Influence’AR
An NFT you could stand in the street and film, shipped to the App Store instead of a deck.
Nadrukuemo
Quotes went from two days to four hours, and the guarantee went on the website.