Value-Based Pricing
How to make your clients happier by charging more.
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$100
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$100
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$100
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$100
$10
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Why should I pay you $150 an hour to
write Ruby when that other guy will do it
for $15?
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RACE TO THE BOTTOM
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RACE TO THE BOTTOM
COMMODITIZATION
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RACE TO THE BOTTOM
COMMODITIZATION
MARKET RATES
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VALUE-BASED
PRICING TO THE
RESCUE!
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A Paradigm Shift
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A Paradigm Shift
★ You are no longer a Ruby developer
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A Paradigm Shift
★ You are no longer a Ruby developer
★ No one cares about Ruby or Rails or
whatever you take pride in
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A Paradigm Shift
★ You are no longer a Ruby developer
★ No one cares about Ruby or Rails or
whatever you take pride in
★ Clients want to know: "What's in it for
me?"
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Take The Spotlight Off Yourself
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Take The Spotlight Off Yourself
★ Reverse engineering salaries
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Take The Spotlight Off Yourself
★ Reverse engineering salaries
★ Figuring out what your peers charge
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Take The Spotlight Off Yourself
★ Reverse engineering salaries
★ Figuring out what your peers charge
★ It’s all about me, me, me
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And Start Understanding Your
Clients
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And Start Understanding Your
Clients
★ Are they losing money? Are they
missing out on untapped revenue?
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And Start Understanding Your
Clients
★ Are they losing money? Are they
missing out on untapped revenue?
★ How can you increase core KPIs?
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And Start Understanding Your
Clients
★ Are they losing money? Are they
missing out on untapped revenue?
★ How can you increase core KPIs?
★ How can you help them fix their pains?
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Focus On The Future
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Focus On The Future
★ Most of us bill. We look to the past.
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Focus On The Future
★ Most of us bill. We look to the past.
★ ...What can this project do for my client?
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Focus On The Future
★ Most of us bill. We look to the past.
★ ...What can this project do for my client?
★ How will this improve what matters?
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Focus On The Future
★ Most of us bill. We look to the past.
★ ...What can this project do for my client?
★ How will this improve what matters?
★ How can I further improve their KPIs?
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Tech Is A Means To An End
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Tech Is A Means To An End
★ No one is paying you to write code
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Tech Is A Means To An End
★ No one is paying you to write code
★ People pay you to make more money
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Tech Is A Means To An End
★ No one is paying you to write code
★ People pay you to make more money
★ EXPLOIT THIS!!!
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Be An Investment, Not An Expense
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Be An Investment, Not An Expense
★ Most don’t recognize the value we
produce
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Be An Investment, Not An Expense
★ Most don’t recognize the value we
produce
★ We focus on the deliverables. The code.
The features. The workflows.
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Be An Investment, Not An Expense
★ Most don’t recognize the value we
produce
★ We focus on the deliverables. The code.
The features. The workflows.
★ None of this matters.
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Level Up Your Business Skills
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Level Up Your Business Skills
★ ROI, TCO, KPIs, utilization, profitability,
overhead
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Level Up Your Business Skills
★ ROI, TCO, KPIs, utilization, profitability,
overhead
★ Make sure every meeting, every
proposal, every LoC aims to benefit a
particular KPI that matters to your
clients.
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“Brennan, You’re Throwing Out A
Lot Of Jargon!”
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“Brennan, You’re Throwing Out A
Lot Of Jargon!”
★ Yes I am.
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“Brennan, You’re Throwing Out A
Lot Of Jargon!”
★ Yes I am.
★ The $10 coder overseas doesn’t use this
jargon.
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“Brennan, You’re Throwing Out A
Lot Of Jargon!”
★ Yes I am.
★ The $10 coder overseas doesn’t use this
jargon.
★ And this is how you’re going to get
ahead.
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And now...
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And now...
THE SECRET TO GETTING
PAID MORE MONEY
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Value based pricing focuses on the
destination, not the road.
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When our focus is correct, the risk
that we'll fail to solve the business
problem(s) at hand is lower.
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And when we can clearly
communicate that we know what's
at stake and we know what that
goal is, we’re perceived as low
risk.
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Clients want to hire someone who
knows their business, its needs,
and has the technical knowhow to
get from today to tomorrow OVER
the person who is merely adept at
coding.
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If a client think there's a 50%
chance that a project will fail (e.g.
a website redesign won't result in
more customers) and is quoted
$50k, the true cost is $75k after
self-insuring for failure.
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Reduce perceived risk by aiming
for the right target and helping
your client get to that target faster
and more efficiently, and you'll be
able to charge more.
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Value-based pricing means
focusing on the client, not
yourself, and pricing based on the
expected outcome of a successful
project completion via
establishing a low risk profile.
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