How does your pricing strategy perform? Do employees, clients and prospects actually like it? The right pricing strategy makes it easier for agencies to scope work, grow accounts, improve productivity, and drive performance. PR 20/20 introduced point pricing to the industry in 2012. In this session, we’ll share why we transitioned to a value-based pricing model, how we pulled it off, and lessons learned along the way.
11. A
B
Math.
Blog Post: Employee A
Hourly rate: $150
Hours to complete: 3
Total Cost: $450
Same Blog Post: Employee B
Original draft ($150/hour,5 hours): $750
Senior review ($250/hour, 1 hour): $250
Edits ($150/hour, .5 hours): $75
Final senior edit ($250/hour, .5 hours) $125
Total Cost: $1,200
#pointpricing
12. “... productize a
service business
The billable-hour model was a flawed, archaic,
agency-centric system that wrongly tied agency
performance to outputs, not outcomes.
…
The problem was that the billable-hour model was the only
one I had ever known. How would we build an entirely
new financial model and productize a service business?
Paul Roetzer
CEO, PR 20/20
“
#pointpricing
22. Agencies can’t accurately predict hours
due to variables such as professional competency,
focus, efficiency and forecaster bias.
The higher the number, the more uncertain
the forecast.
#pointpricing
1, 2, 3, 5, 8, 13, 21, 34, 55 . . .
39. 1. Humans are not good at forecasting.
2. Event with value-based pricing, businesses operate on hours.
3. Strategic anticipation, agile implementation.
4. Transparency promotes client trust, loyalty, and growth.
5. Easy to scope = easy to sell.
Recap
#pointpricing
55. Point Pricing
for Agencies
PR 20/20 boiled down everything they've learned through
years of pricing experimentation into three short,
well-constructed sessions, and supplemented the webinars
with invaluable tools to help with implementation.
This series was worth the price of admission 10x over.
If you're an agency owner or project manager, I can think
of very few things I'd recommend you do with your time
before immersing yourself in this series.
Joe Sullivan
Gorilla 76
#pointpricing