This question has been on my mind since the untimely passing of Tony Hsieh at the age of 46. Most famous for helming shoe retailer Zappos for nearly 20 years, Hsieh was an inspirational advocate of putting the customer at the center of a company’s worldview.
Zappos encouraged its customers to buy many shoes and return nearly as many; despite being very costly logistically, such service was understood as critical to helping customers become comfortable with shopping for such fitting-dependent items online. …
Steven Levitt, Professor of Economics at the University of Chicago, along with journalist Stephen J. Dubner, is most well-known for his 2005 bestseller Freakonomics: A Rogue Economist Explores the Hidden Side of Everything, which has sold more than 5 million copies.
The book spawned multiple sequels, a film, a podcast, and a blog. (The blog gets extra points for featuring my Great Recession-themed album, Recession Sessions.) Freakonomics, along with his academic work, has also made Levitt in demand at companies looking to improve their performance. …
I recently completed Impact Denver (ID), a nine-month study in leadership, civic engagement, and the local business community. A program of the Denver Metro Chamber of Commerce Leadership Foundation, Impact Denver brings a diverse group of young professionals from across the metro region to learn from each other and complete meaningful projects for local non-profits.
What began in January with in-person lectures and group work had to adapt quickly to our new remote normal when COVID-19 arrived in force. The organization did a great job in maintaining continuity and delivering a rewarding program.
Here are three takeaways from my ID…
When it comes to defining the role of pricing, it can be complicated. Pricing can mean various things in various industries and companies. Similarly, the tasks that different pricing professionals require at different stages in their career vary considerably as well.
However, there are certain commonalities in the type of skills that pricing professionals use at different levels of maturity. To illustrate this, we have developed the following pricing talent matrix:
Let’s dig into this to see how this radial graph illustrates the abilities required of different pricing functions and team members.
The first three (analyst, manager, and leader) are…
I came across the following visualization from a pricing leader on LinkedIn. Its purpose is to show how a product’s gross profit (GP%) and a customer’s price sensitivity can suggest different pricing movements and their effect on revenue and gross profit.
Good, clear communication is very valuable. I want to make sure pricing practitioners are getting good information. While there are some things I like about this visualization, there are others that are important to highlight.
The core relationship shown by this visualization is a good one to recognize: changes in price have asymmetric effects depending on characteristics of the…
My colleague, Nathan L. Phipps, wrote an excellent overview of price gouging with regards to the COVID-19 pandemic. I tasked myself with delivering my own take, this one in the form of a song: “Price Gouging Blues.”
Famously, in a landmark 1964 U.S. Supreme Court obscenity case, Justice Potter Stewart avoided the question of clearly defining “obscenity” by stating: “I know it when I see it.” The same can be said about the difficulty in defining price gouging.
What’s a pricing strategist to do? Play it safe when it comes to legal and ethical boundaries. …
Spotify, the global leader in music streaming, could boast 271 million active users at the end of 2019, dwarfing competition from the likes of Apple Music (60 million) and Amazon Music (55 million).
But being the market leader comes with a downside: drawing the ire of those who decry the entire streaming business model. In this sense, Spotify is much less popular than its user numbers suggest.
Taylor Swift, one of the most successful pop musicians of her generation, famously feuded with Spotify in 2014 by pulling her back catalog from the service and refusing to release her new music…
If you’ve ever used a ride hailing app, chances are that at some point you’ve experienced a higher than expected fee. Surge pricing is surely unpleasant when you’re on the paying end; almost everyone would prefer to pay less than more for a given product or service. Yet, as a form of dynamic pricing, such adjustments seek to balance the supply of drivers and the demand of riders, ensuring a well-functioning marketplace.
This functionality is core to market leaders such as Lyft and Uber. But does it have to be?
We are certainly cursed to live in interesting times. While individuals, families, communities, and governments struggle to adjust to the realities of COVID-19, the corporate world is also facing a reckoning.
Seeing the business reaction to COVID-19 reminds me of one of my favorite quotes, uttered by James R. Schlesinger, first US Secretary of Energy, in 1977: “We have only two modes — complacency and panic.”
Businesspeople are obsessed with efficiency. They want to know how to increase their throughput and productivity. Yet, too many executives forget that efficiency isn’t a goal in and of itself.
Founding management guru Peter Drucker’s magnum opus is called The Effective Executive, after all, not The Efficient Executive. The hardest thing for executives, especially managers, is to know what the right thing to do actually is.
Effectiveness is about knowing the right things to do. Efficiency is about doing things quickly and inexpensively. …