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Spy on my competitor to learn their pricing strategy?

by FormerWageSlave
19 replies
I am planning on expanding my offline video service with a new product offering in the very near future. It's a complex service and the pricing is highly variable.

There is a large company doing this already with some big name brands. I would love to learn more about how they approach their sales and pricing. They don't list prices on their site due to the complexity of the service.

I don't think I want to lie and go through their sales process, since I don't think I could pull it off.

Is spying good business strategy... know your competition and all that? Not sure how to go about getting the intel I need as it's not on the site.

Or should I not bother and do my best to price my service based on my own factors?
#competitor #learn #pricing #spy #strategy
  • Profile picture of the author vndnbrgj
    What is the competitor? I know the prices of several larger video companies....

    However, you also shouldn't worry about it.
    It's all about positioning and your market.

    You can get customers whether you are the lowest, or highest price.
    It's just about positioning and perceived value.
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    • Profile picture of the author FormerWageSlave
      Yeah, this would be more about how they go about setting the pricing. I'm not too concerned about competing with them directly. I know there's plenty of room for both of us.

      It's a complex product with production, hosting, analytics and distribution as well as increased conversions for the client. And it's variable and scalable.

      I'd love to know how they factor it all together for a final price.

      I know I can figure out what'll work best for me... but still, I'd love to know what their experience has taught them, so I can be as optimized as possible from the get-go.



      Originally Posted by vndnbrgj View Post

      What is the competitor? I know the prices of several larger video companies....

      However, you also shouldn't worry about it.
      It's all about positioning and your market.

      You can get customers whether you are the lowest, or highest price.
      It's just about positioning and perceived value.
      Signature

      grrr...

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      • Profile picture of the author Irish Intuition
        Are we talking about a local competitor or online competitor?
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  • Profile picture of the author FormerWageSlave
    I guess maybe competitor was the wrong term. These guys are a powerhouse in the space... I imagine, at least for a while, I would be utterly insignificant to them.

    I will be going after smaller, national brand clients who happen to be local to me, in the beginning. Of course if I'm successful, I would go after bigger clients and maybe I would be competing with them at some point? Who knows... all I know is that right now there's opportunity to get my own clients and make some money now.
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    grrr...

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    • Profile picture of the author Irish Intuition
      Never go head to head with anyone. Instead of spying on them
      for pricing structure, look at what they are offering/saying.

      Be different than they are... or at least talk about what
      they are not. Bigger brands tend to become more self
      indulged. Use that to your advantage. Think about
      what your client's problems are and focus strictly
      on one or two of those.

      Don't be a 'we fix everything'.
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      • Profile picture of the author FormerWageSlave
        Yep, I understand all that... I'm curious about how they factor the price for their clients.

        Originally Posted by Paul McQuillan View Post

        Never go head to head with anyone. Instead of spying on them
        for pricing structure, look at what they are offering/saying.

        Be different than they are... or at least talk about what
        they are not. Bigger brands tend to become more self
        indulged. Use that to your advantage. Think about
        what your client's problems are and focus strictly
        on one or two of those.

        Don't be a 'we fix everything'.
        Signature

        grrr...

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  • Profile picture of the author agonce
    I'd say just go ahead and do it, act as you're interested in their service that is ... Or you could say it's about a friend of mine who owns XXXXX place.

    Can you share what this service is by the way?
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  • Profile picture of the author Jason Kanigan
    What revenue does your prospect believe they'll pull in with your video method?

    What percentage of that revenue do they believe is fair to pay you for your expertise in helping them get this revenue?

    If you agree with those figures, that should be what you charge.
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    • Profile picture of the author FormerWageSlave
      Yes, I have data on industry norms for % increases when utilizing this. Based on their current revenue on a given product, applying my solution should yield an increase and should be taken into account when determining price.

      ***Edit***

      In other words, I agree with you and appreciate the input. I was thinking along those lines at least as a factor in the pricing.


      Originally Posted by kaniganj View Post

      What revenue does your prospect believe they'll pull in with your video method?

      What percentage of that revenue do they believe is fair to pay you for your expertise in helping them get this revenue?

      If you agree with those figures, that should be what you charge.
      Signature

      grrr...

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  • Profile picture of the author af7850
    Seriously? Op research is the fun part! I think that it makes sense for you to do it, you might pick up one or two very helpful pieces of intel. Are you interested in outsourcing that research? I have a national brand that could be used to inquire, service industry holding co with well over 1000 US locations. I'd put in an hour or two going through the motions with the sales rep for you if it would help. Posted from Warrior Forum Reader for Android
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  • Profile picture of the author FormerWageSlave
    @af7850 - sent you a PM.
    Signature

    grrr...

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    • Profile picture of the author af7850
      Originally Posted by FormerWageSlave View Post

      @af7850 - sent you a PM.
      Want to hear something funny? I typed out a detailed response to you, then realized that a schmuck with 16 posts can't send PMs.

      Email af7850 (at) yahoo (dot)com.

      Thanks.
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  • Profile picture of the author Chronic IM
    Hello!

    Spying isn't the best solution, though you do need to know a little info about your competitors strategy. Know a little about them then, think of your own strategy to overcome theirs. You should also do your best and some little spying on competitors.

    Best of Luck!
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  • Profile picture of the author iAmNameLess
    I didn't read other posts... because frankly, I don't care to. LOL. Not because I think they don't offer value, but mainly because I just want to answer.

    People might say spying on competitors is unethical... and dishonest, and you shouldn't do it. Yeah... maybe it is dishonest to string a sales person along just to gain information.

    This is business... this is war. Business is not about being friends with your competitors, but finding a way to take over your competition's turf, expand, capitalize on their mistakes and hurt them. While it sucks when people lose their jobs, you want your competition gone so you can expand.

    I always thought, there is plenty of business out there that we don't need to fight over it. Then, I grew up. It's either I eat, or I don't eat. I either get complacent and someone else pops up, or I dominate. I have clients across the country, and never focused locally. It kind of hurts my ego, when nobody locally knows about me but businesses in orange county, or Sacramento know about me. SO... a couple weeks ago I decided that I'm going to dominate my local market... I have about 6 legit immediate competitors... about 20 in my metro area. My goal, is to put half out of business... not a personal attack on them, but to dominate the market so much, it leaves nothing left for them.

    I started out by calling a few, and going through their sales process, getting references, calling their references and having a couple friends talk to them and meet with them, which I paid them to do. I have information on all of them.

    I know each company's weakness, strong point, pricing points, what incentives they're offering, past clients.. I know where they are heading and what their plans are.

    You don't need to be as cut throat as I am... but you do need to know your competition. What your competition does, is directly effecting you whether you know it or not.

    This is the game and life of business. You either succeed, or you fail... and the beautiful thing about it.... you decide what you do.

    So do it... get information, information is king, and capitalize on it. Take advantage of every weakness, and manipulate every strongpoint that they may have.


    EDIT: I realize this had very little to do with pricing... but it's still important, not just from a pricing standpoint, but EVERYTHING. What you should charge, depends on what your time is worth to you, and on what your competition is doing.
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    • Profile picture of the author FormerWageSlave
      I don't disagree with you and I don't think it would be unethical. If it were one phone call to get what I need, I'd do it. I have done it.

      But the complexity of the product means I would have to put up the charade for some time and I don't think I could pull it off. Maybe I could... maybe if I can't sort it out on my own, I'll do it.

      I've been working on the pricing strategy all day and it helped once I started creating a variety of templates for sample closed clients and the backing out the costs from those scenarios. Then, as Kanigan suggested, looking at the value they might receive.

      It's not perfect and there are a number of assumptions that need to be made, but I think I have a formula that I can use to plug info into.

      Thanks all, for your suggestions!

      Originally Posted by iAmNameLess View Post

      I didn't read other posts... because frankly, I don't care to. LOL. Not because I think they don't offer value, but mainly because I just want to answer.

      People might say spying on competitors is unethical... and dishonest, and you shouldn't do it. Yeah... maybe it is dishonest to string a sales person along just to gain information.

      This is business... this is war. Business is not about being friends with your competitors, but finding a way to take over your competition's turf, expand, capitalize on their mistakes and hurt them. While it sucks when people lose their jobs, you want your competition gone so you can expand.

      I always thought, there is plenty of business out there that we don't need to fight over it. Then, I grew up. It's either I eat, or I don't eat. I either get complacent and someone else pops up, or I dominate. I have clients across the country, and never focused locally. It kind of hurts my ego, when nobody locally knows about me but businesses in orange county, or Sacramento know about me. SO... a couple weeks ago I decided that I'm going to dominate my local market... I have about 6 legit immediate competitors... about 20 in my metro area. My goal, is to put half out of business... not a personal attack on them, but to dominate the market so much, it leaves nothing left for them.

      I started out by calling a few, and going through their sales process, getting references, calling their references and having a couple friends talk to them and meet with them, which I paid them to do. I have information on all of them.

      I know each company's weakness, strong point, pricing points, what incentives they're offering, past clients.. I know where they are heading and what their plans are.

      You don't need to be as cut throat as I am... but you do need to know your competition. What your competition does, is directly effecting you whether you know it or not.

      This is the game and life of business. You either succeed, or you fail... and the beautiful thing about it.... you decide what you do.

      So do it... get information, information is king, and capitalize on it. Take advantage of every weakness, and manipulate every strongpoint that they may have.


      EDIT: I realize this had very little to do with pricing... but it's still important, not just from a pricing standpoint, but EVERYTHING. What you should charge, depends on what your time is worth to you, and on what your competition is doing.
      Signature

      grrr...

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    • Profile picture of the author bluecoyotemedia
      I am nameless

      I would see you coming a mile way

      and then I would eat your lunch pal

      money never sleeps pal

      and you all ready know my name I already cased your joint
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      Skunkworks: noun. informal.

      A clandestine group operating without any external intervention or oversight. Such groups achieve significant breakthroughs rarely discussed in public because they operate "outside the box".
      https://short-stuff.com/-Mjk0fDExOA==

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  • Profile picture of the author Dan B Rusu
    What's the name of the company? I'll call them for you
    Signature
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  • Profile picture of the author RRG
    Ooooh, cat fight!

    OK, there is nothing wrong with entering your competitors' funnels. In fact, you should. Not just to see what they're doing, but how they're marketing it (the spoils go to the best marketer, not the best product).

    If you have the money, you should even buy their service so you can dissect it from the inside. Or have a friend be your "front."
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