Monetizing data is a growing topic of conversation globally. The proliferation of data and the Internet of Things (IoT) is providing a lens into understanding customer usage like never before. One that will help drive innovative models for data monetization. Yet, one cannot discuss the opportunities that come with big data without thinking about data security.

Understanding how a product or service offering creates differentiated value for the customer is the foundation of value-based pricing.  Prices should align with the value the customer receives, thus ensuring the seller is maximizing returns from the customers and target the customers that derive the most value from the offering. These are the customers that will be happiest and most successful, the kind of customer you want to build a business on. For pricing to be effective, it should track the value metric. This is the unit by which the product or service offering is consumed that best reflects how the customer gets value.

The world of Service Design—an interdisciplinary skill that blends elements from various fields such as user experience, systems design, marketing, and psychology to optimize new services. Explore its key principles and associated skills, and learn how Ibbaka enhances collaboration in this innovative domain.

The people who came together to form Ibbaka have a long working history of working together. We have built companies together, organized communities of practice and even put on a few conferences. We know how each other work and how we learn.

Discounting can be a touchy subject. Sales people often claim that discounts are required to make the sale. Pricing is philosophically opposed to discounts as they undermine profitability and signal lack of pricing power. Marketing worries about how discounts will impact value perception but at the same time desire the increased attention that a well-managed discount campaign can generate. How do you manage all of these different imperatives?

We are opening a LinkedIn Group on Pricing the Internet of Things. Why do this? There are many excellent LinkedIn groups on pricing. The Professional Pricing Society has a particularly good one and we are active on it. There is also a good group Internet of Things Strategy and Innovation. So why another LinkedIn Group?

One of the best questions we are asked is 'OK, you are pricing experts, so how do you price your own services?'

A fair question and we don't answer this by giving a price. We advise our clients not to get into a price discussion until they have established value. We follow that advice ourselves!

Much of the work we do at Ibbaka is centered around value-based pricing. In one of my previous posts, I reviewed one of the key inputs of pricing strategy—market segmentation. Now, I would like to explore another critical business process—value-based selling. How can we enable our sales people to practice value-based selling? 

The freemium revenue model is the go-to-market strategy for many web-based software solutions. Unfortunately, it can turn into a costly trap for the service provider. We saw this happen in June of this year with the Photobucket freemium to fee-based service migration debacle. Let's delve into what went wrong with Photobucket's fee introduction and contrast this with the lessons to be learned from Meetup's successful migration to a paid subscription model.

Bringing a new offer to market is one of the most difficult things a business does. There are a lot of moving parts and it is difficult to keep all of them aligned. Pricing is something that often gets left to the end of the process.

Pricing power has a huge impact on how investors see your company. One rule of thumb used in due dilligence is to ask, 'Can this company raise its prices?' If the answer is no, or if there is a lot of downward pressure on prices, then company valuation goes down. Smart companies understand their pricing power and are taking steps to increase it.

Customers want choice. That is a fact. According to a global Nielsen survey,  63% of customers around the world want manufacturers to offer a new product.

Many B2B SaaS companies struggle with pricing implementation and professional services. They often wonder if they should offer professional services at all. If so, how should they be positioned and what role should professional services play in overall strategy? Let’s examine this.

A solid pricing strategy necessarily needs to be based on an understanding of your customer and their alternatives. There are a lot of tools that can be used to gather this information.

Pricing decisions operate within a dynamic, uncertain and competitive landscape. They can have a lasting impact on an organization’s long-term profitability and growth strategy.

The Liveworx conference ran from May 22 to 25 in Boston this year. Almost 10,000 delegates attended with about 99 companies exhibiting. This conference is PTC’s flagship event to highlight its Internet of Things and Augmented Reality platforms.

First cloud computing, then mobile phones and their apps, and now the Internet of Things are coming together to change how we think about pricing. Each of these innovations has added a new layer of data, a new layer of complexity and new business opportunities. All of this is giving us new ways to think about pricing.

Tom Tunguz is one of the best informed and prolific of the venture capitalist bloggers. His blog is generally well researched and thoughtful. Worthy to be on your read regularly list. On May 9, 2017, he published a piece titled "The Challenge of Performance Pricing for SaaS Companies." This time, I think he got it wrong.

Pricing is ubiquitous in our everyday lives yet pricing seems to be at the periphery of most business decisions.

Value-based pricing is based on understanding how your offer creates value for your customers. The standard way to do this is to see how you can improve their statement of profit and loss. Understanding this is a good start, but does it really enable to right conversations with your customers?