Mastering services pricing: designing pricing that works for you and for your clients

321 Pages·2015·4.661 MB·English

by  Doolan, Kevin

MASTERING M Designing pricing that works MASTERING
SERVICES MASTERING A for you and for your clients SERVICES
S
T
PRICING SERVICES PRICING
E
R
MASTERING
PRICING I
Designing pricing that works N Designing pricing that works
for you and for your clients G for you and for your clients

Designing pricing that works S
SERVICES Mastering Services Pricing is a comprehensive guide
E
on how to price services for all businesses. Focusing
Kevin Doolan MBA is a leading expert in for you and for your clients R
on both you and your client, the book uses business-
services pricing, having used his degree to
V grounded academic research on buyer behaviour
develop a highly acclaimed research-based
I to help you understand the impact of price on the
international pricing model.
‘Kevin is a highly engaging teacher. His innovative approach to Value Engineering C PRICING buying decision. You will find out how to ensure that
As a qualified solicitor and former Head shows service providers how to collaborate with their clients to positively shape E your prices are aligned to deliver the right profit for
of Client Relations at Eversheds LLP, he the relationship and make it more valuable, thereby justifying higher prices and S you, while meeting your client’s needs at a price they
spent more than 25 years as partner of the delighting the client at the same time.’ are happy to pay. Kevin Doolan introduces tools and

international law firm. This gave him front Heidi K. Gardner, PhD, Distinguished Scholar, The Center on the Legal Profession, P strategies to help you understand your competitive
line experience of negotiating prices with Harvard Law School R position, develop more valuable services and feel more
some of the largest companies in the world. confident in your pricing strategy.
I l How to justify higher prices
C
He is now Managing Partner of the Møller
Mastering Services Pricing is a practical guide to creating services pricing that works Mastering Pricing Services includes:
Professional Service Firms Group based at I
Churchill College, University of Cambridge both for you and your clients. Written by an award-winning expert in the field of pricing, N l When to use alternative fees • The strategy and tactics for pricing a wide range of
and teaches pricing on the Professional it provides invaluable models, strategies and tactics which will ensure that your pricing is G services
designed to deliver maximum profit and high client satisfaction.
Service Firm Leadership Programme at the l Be confident in your pricing strategy • How to produce profitable growth with more
Judge Business School. satisfied clients
Mastering Services Pricing includes:
Kevin developed the Harvard Law School • How clients buy services l Dealing with procurement • How a better understanding of a client’s needs
Case Study on Pricing Services (HLS 13-17) allows for higher prices
and is visiting faculty at Harvard, teaching • The impact of price on profit • In-depth advice on pitching for work and how to
on their Accelerated Leadership Course. • A guide to pitching for work develop different services to address all of your
In 2015 he created their Case Study on market segments
• How to negotiate price
Business Development (HLS 15-12).
• The tactics of pricing
In 2009, Kevin won a Financial Times
Innovation Award for Client Service and • How to deal with procurement
was awarded the Law Society’s Excellence • How to justify higher prices
Award for Innovation the following year.
• Alternative fees
D
O
O
L
A
BUSINESS
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Visit our website at
www.pearson-books.com
KEVIN DOOLAN
Visit our website at
www.pearson-books.com
CVR_DOOL3362_01_SE_CVR.indd 1 30/06/2015 10:20
PRAISE FOR M ASTERING SERVICES PRICING
‘Kevin is a highly engaging teacher. His innovative
approach to Value Engineering shows service providers
how to collaborate with their clients to positively shape
the relationship and make it more valuable, thereby
justifying higher prices and delighting the client at the
same time.’ Heidi K. Gardner, PhD, Distinguished Scholar,
The Center on the Legal Profession, Harvard Law School
‘This comprehensive guide to services pricing will help
those in every size and type of practice develop effective
strategies and tactics for negotiating and setting prices in
the new market. Kevin’s focus on strengthening the client
relationship through the identifi cation and provision of client
value will prove especially important for those seeking to
price their services fairly and effectively.’ Jordan Furlong,
Principal, Edge International
‘Kevin Doolan has written a lively and practical guide to a
problem that bedevils law fi rms: how they price their services.
As important, the book will help lawyers get closer to their
clients, the key task at every fi rm that plans to succeed in
this diffi cult market.’ Aric Press, Partner, Bernero & Press
and former editor-in-chief, The American Lawyer
‘Contains valuable new ideas and strategies that can be
used by anyone looking to address the price versus value
confl ict: how exactly to price professional services so that
they refl ect the value that clients receive, and not just the
time that has been taken. Above all, it is a practical and
pragmatic guidebook which goes beyond just theory and
into easily implementable steps that anyone can take to see
real returns on their pricing strategy.’ Steven G. Manton,
Strategic Pricing Leader, Debevoise & Plimpton LLP
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For Debbie and Kimberley,
who give my life meaning and value
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Mastering Services
Pricing
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Mastering Services
Pricing
Designing pricing that works for
you and for your clients
KEVIN DOOLAN
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Pearson Education Limited
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Harlow CM20 2JE
United Kingdom
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Web: www.pearson.com/uk
First published 2015 (print and electronic)
© Kevin Doolan 2015 (print and electronic)
The right of Kevin Doolan to be identifi ed as author of this work has been asserted by him
in accordance with the Copyright, Designs and Patents Act 1988.
The print publication is protected by copyright. Prior to any prohibited reproduction,
storage in a retrieval system, distribution or transmission in any form or by any means,
electronic, mechanical, recording or otherwise, permission should be obtained from the
publisher or, where applicable, a licence permitting restricted copying in the United
Kingdom should be obtained from the Copyright Licensing Agency Ltd, Saffron House,
6–10 Kirby Street, London EC1N 8TS.
The ePublication is protected by copyright and must not be copied, reproduced,
transferred, distributed, leased, licensed or publicly performed or used in any way except
as specifi cally permitted in writing by the publishers, as allowed under the terms and
conditions under which it was purchased, or as strictly permitted by applicable copyright
law. Any unauthorised distribution or use of this text may be a direct infringement of the
author’s and the publisher’s rights and those responsible may be liable in law accordingly.
All trademarks used herein are the property of their respective owners. The use of
any trademark in this text does not vest in the author or publisher any trademark
ownership rights in such trademarks, nor does the use of such trademarks imply any
affi liation with or endorsement of this book by such owners.
P earson Education is not responsible for the content of third-party internet sites.
I SBN: 978-1-292-06336-2 (print)
978-1-292-06338-6 (PDF)
978-1-292-06337-9 (eText)
978-1-292-06339-3 (ePub)
British Library Cataloguing-in-Publication Data
A catalogue record for the print edition is available from the British Library
Library of Congress Cataloging-in-Publication Data
Doolan, Kevin.
Mastering services pricing : designing pricing that works for you and for your clients /
Kevin Doolan.
pages cm
Includes index.
ISBN 978-1-292-06336-2
1. Professional corporations. 2. Fees, Professional. 3. Customer services.
4. Service industries–Prices. I. Title.
HD62.65.D66 2015
658.8’16–dc23
2015016981
10 9 8 7 6 5 4 3 2 1
19 18 17 16 15
Print edition typeset in 11.5/13.5pt Garamond 3 LT Std by 35
Print edition printed by Ashford Colour Press Ltd, Gosport
NOTE THAT ANY PAGE CROSS-REFERENCES REFER TO THE PRINT EDITION
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Contents
About the author xiii
Publisher’s acknowledgements xiv
Author’s acknowledgements xv
Preface xvii
Introduction xix
1 How clients buy services 1
The data 3
Rocket Science 5
Relationship Advice 8
Routine Work 9
The fi ve criteria 10
Pricing Rocket Science 12
Pricing Relationship Advice 15
Pricing Routine Work 20
2 Cost-plus pricing and beyond 23
Cost-plus pricing 25
Client-driven pricing 30
Competition-driven pricing (market-driven) 33
How service fi rms compete 37
What next? 45
Client messaging 46
The competitive landscape – what is your market
positioning? 46
New service launches – setting the market price 48
3 Pitching for work 53
Pitching for Rocket Science 55
Pitching for Relationship Advice 57
The link between chemistry, likeability and price 62
Pitching for Routine Work 67
ix
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