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Monday, January 21, 2008

Obtaining real value

"Value" is both subjective and objective. It is subjective in that it represents the worth in what you and/or your client see in the worth you do. It is objective in that it can be measured, often in tangible ways. But it is not consistent in all situations/circumstances, and sometimes when value is compared to price, all (apparent) logic goes out the window.
We , for example, preach that you should sell value rather than price. But if you are going to sell value, you need to show it is there before you get your price. And if you try too many tricks or techniques, too early -- before your brand is established -- you risk losing the game.
For example, the representative of a business we are considering using to redesign our websites emailed me this weekend to say the project we have in mind is a large application, and he proposed a meeting with all people necessary present, to gather information to develop a full-blown proposal. The fee: $450. Even though this is just what Sonny Lykos (and I) think makes sense for larger renovation projects, I balked. No way am I ready -- at least just yet -- to lock myself into doing business with these guys. They haven't done enough of their homework to build their brand with me, yet.
I responded, "Please provide me with a ballpark estimate of costs". Not some vague hourly thing (they have done that already), but a general estimation of how much time/money will be required. Not a full blown proposal, of course. But I want to see if they are in the range of reasonable. And how do I know the range of reasonable? I engaged the services of a consultant -- without competitive bidding, but based on t he referral of someone I trust -- who drew up the road map for the proposed site and, with the fee paid, gave me time lines for design and coding to achieve the site objectives. I trust the consultant because he is not bidding on the final project, nor pushing any particular developer to complete it. In other words, he has every reason to be objective in his interpretations and recommendations.
The website developers I've met (through a sales rep who originally applied to work for our company as an employee), have shown me they are probably competent to do the work, but they haven't yet proven to me that they will indeed deliver the best value. In the email to me this weekend, their sales rep outlined some of the uncertainties which, he said, makes it impossible for them to produce a firm quote. I responded to his specific points, noting areas of potential variance, and said "give me the ballpark price". If he doesn't respond quickly, and resolve my concerns, he will indeed prove to me that I should go into the open market and find the best price. And I will.
P.S. As I wrote this blog entry, my consultant provided me with detailed observations about how any remaining uncertainties can be resolved -- within the original consulting fees I am paying. (The consultant, in this situation, has established his brand value!)

3 comments:

Sonny Lykos said...

Mark said: "And if you try too many tricks or techniques, too early -- before your brand is established -- you risk losing the game."

So true. I never charged a fee for anything until my brand was created, secured, and "I" became the sought person instead of me seeking potential customers.

In other words, that potential customer must first already have the perception that I represent their solution, worthy of a nominal fee structure. Before branding is established, those same fees come across as representative of arrogance. Why? Because the potential customer is really thinking: "For what? Who are you?"

Mark Buckshon said...

Agreed....

A puzzling thing here is this dialogue between the web developer and me is happening by email; I find it strange to be doing this, but I'm going to phone the person involved tomorrow to see if I can get the simple answer that I'm seeking -- a ballpark estimate. The request at this point is simple, reasonable and should not demand a lot of bureacuracy or detailed proposal paperwork -- we can get to that stage soon enough if there is mutual and genuine interest in working together.

Mark Buckshon said...

A follow up: To their credit,the software developoers came back with, as requested, a soft ballpark price and time estimate. It is entirely in line with my consultant's projections and budget; so we will proceed to define the scope of work more clearly and then, after obtaining a firm quote, proceed with the project.