LeveragePoint discusses the downsides of relying too heavily on a cost/price control approach. We'll show a recent case example of a company facing the dilemma of stagnant growth - and how a value-based marketing and sales approach will save it.

1. Monthly Webinar Series - February 2012
Surviving the Recession to
Perish in the Recovery
Jay Manson
Copyright © 2012 by LeveragePoint Innovations Inc.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means —
electronic, mechanical, photocopying, recording, or otherwise — without the permission of LeveragePoint Innovations Inc.
This document provides an outline of a presentation and is incomplete without the accompanying oral commentary and discussion.
COMPANY CONFIDENTIAL

2. Sponsored by LeveragePoint
the Software Solution for Value-based Pricing
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3. Today’s Presenter
Jay Manson is Vice President of Sales at LeveragePoint.
He joined LeveragePoint in June 2010 and is responsible for
bringing LeveragePoint t market.
bi i L P i t to k t
He brings over 15 years in business development, sales and sales
management experience, and has spent the past 10 years in the
value-based marketing, pricing and sales industry.
Formerly, a National Account Executive at Vendavo. Prior to
Vendavo,
Vendavo he served as Director of Business Development in
Monitor’s Strategic Pricing Group and as Managing Director for
Benchmark Partners.
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4. Market Forces Drive Relentless Margin Pressure
THREE CS OF PRICE PRESSURE:
Powerful CUSTOMERS
Price Global COMPETITORS
Product COMMODITIZATION
COST – “RUG” – DYNAMIC
RISING in an UNPREDICTABLE manner
Costs based on GLOBAL factors
TIME
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5. Polling Question
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6. Companies Have Recovered Revenue . . .
15.5%
. . . but what happened to margin???
$1.5B $
$1.5B
Margin
$0.232B
$0 232B
13.0%
Net Revenue
$0.195B
Gross Income
2007 2008 2009 2010 2011
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7. Is Passing Through Raw Material Costs Enough?
Year 1 Year 2
100 units are sold at $1 000
it ld t $1,000 Raw t i l
R material costs rise b $200
t i by
each. Therefore, Total Revenue = per unit. All cost increases are
$100,000. successfully passed through to
the customer
How
H many units need t b sold i Y 2
it d to be ld in Year
to get $100,000 in revenue?
Answer: 83 units
Sales has fought hard for revenue but selling fewer units at a lower
margin. This is why companies are not surviving the recovery.
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8. So How do We Address This?
In order regain our margin we need to pass through the value we deliver
above and beyond our cost
What is required:
• Products priced based on the value they deliver
• Sell based on the value you deliver
How to do it:
• Continual effort to understand how we improve our customers business and
operations.
• Systematic approach to capturing and quantifying the economic benefits we are
delivering
• Collaborating with customers to build a common understanding of these economics
• Understanding of the value of the competition
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9. Products Priced Based on Value
Traditional approach
Product Cost Price Value Customers
What is the best product we can offer customers?
Value-based approach
V l b d h
Customers Values Prices Costs Products
What is the best value we can offer customers?
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10. Key Questions for Products Priced Based on Value
Product Development Process
Opportunity Business Marketing
Assessment Case Plan
How do I determine Should the new offering How do I determine
the value of my new be a stand-alone a value-based price?
offering? product, feature
product a feature, or an
extension of an existing What are the right
How do I segment my product based on: pricing metrics?
market for pricing
purposes? What will differentiate us
most from the
competition?
What delivers the most
value for the customer?
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11. Sell Based on Value
Value-based lli
V l b d selling answers th
the
question:
What are the three or four
things th t make you b tt th
thi that k better than
the competition and ….
What is that worth to your
customer?
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12. Sell Based on Value
• Fact-based approach that quantifies the
full
f ll economic i
i impact of the purchase
f h h
• Provides a comparison of your product
against competitors
• Quantifies the value in financial terms
• Links the price and the value together
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13. What Value-Based Selling Looks Like
LeveragePoint allows the
user to develop the unique
value with the customer
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14. Try LeveragePoint for 90 Days to Pass Margin On!
• Delivers tangible, usable marketing/sales content within hours!
– Use the application to price new products based on value
– Use the application to sell based on value
• Initiate the effort to understand how we improve our customers business
and operations.
d ti
• Provide your team with a systematic approach to capturing and quantifying
the economic benefits we are delivering
• Unlimited use of LeveragePoint for your marketing/ sales teams to build
value models and test value propositions
• Includes initial training and coaching throughout the entire process
• All for $15,000
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15. Our Next Webinar – March 20th
• Stephan Liozu, President & CEO of ARDEX
Americas
A i
•O
Organizational T
i ti l Transformation t V l
f ti to Value-
based Pricing: Case Study of a Mid-size
Industrial Company
p y
• NOTE Earlier Time! 11:00am Eastern
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16. Thanks for Watching!
www.leveragepoint.com
jmanson@leveragepoint.com
Jay Manson
(781) 727 – 5977
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