How to determine competitor's pricing model when impersonating a customer is challenging


2

This question accompanies my recent previous question, Are there any methods you can think of to determine a comptetitors pricing model under these stipulations:

  • The pricing sheet is not publicly posted
  • You must make contact with a salesperson to receive a custom quote
  • Impersonating a customer is illegal, the target customers are law enforcement agencies. Impersonating an agent of law enforcement is a felony offense.

This idea is still in its infancy and the product is just a concept so far. Does it make sense to start cold-calling?

Pricing Sales Competition

asked Nov 16 '11 at 01:58
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Maple Shaft
323 points
Top digital marketing agency for SEO, content marketing, and PR: Demand Roll
  • Hmm, very interesting situation. I'm curious to see what people come up with. – Hartley Brody 8 years ago
  • Ethical behaviour and success in business are not mutually exclusive. I would consider the values you want your company to have before embarking on a strategy like this. – Joel Friedlaender 8 years ago
  • @JoelFriedlaender Not sure how things work in Australia mate but here in the states the guy who puts profit above ethics will usually eat the hard working guy's lunch, and everybody just seems to look the other way. – Maple Shaft 8 years ago
  • My experience is that the person that executes better wins, not the person that puts profits above ethics. – Joel Friedlaender 8 years ago

3 Answers


5

Go googling for competitor's name, and the keywords budget, price etc Many government agencies post documents online that a private business would not. They are often subject to sunshine/transparency/open records rules. You might be surprised what you will find.

answered Nov 16 '11 at 04:59
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James
1,231 points
  • What a great idea... this is why I love this site, you guys think of things I would never have considered! – Maple Shaft 8 years ago

2

Sign up at least one real customer for a free unpaid beta. Be open with them that one thing you would like their assistance with is determining proper pricing for your product/service.

Many times it is not difficult for them to get a rough price, or in the case of LEO's they are a tight knit community and police chiefs talk to each other (plus they have an annual trade show that I have exhibited at). They should be able to get you rough budgetary pricing directly or via knowing a colleague that is a customer of your competitor.

The other alternative is to set a realistic but slightly high price for your product and make the purchase a "discussion", which is what it sounds like your competitor does. Set the price at $5K/mo (as an example). If you get moderate push back, your price is about right. If you get outrage, your price is too high. If you can't collect billing info fast enough to keep up with demand, your price is too low. In other words, figure it out as you go. If you have a bona-fide business plan, then your price is based on YOUR valuations and assumptions, not your competitors price.

answered Nov 16 '11 at 10:32
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Brian Karas
3,407 points
  • Thanks for the great advice! I think perhaps my business plan is not all that solid then. I will admit that the competitor is offering solutions that go above and beyond anything I could possibly do with my budget. I am hoping to offer less and undercut them on price, going for smaller customers with a smaller budget, building clients one at a time. Then I can slowly afford specialized talent needed to offer the more technically challenging features and get bigger clients. – Maple Shaft 8 years ago

-1

You can always become a customer of your competitor by making a real purchase. Unless you are in a airbus industry, you can always buy your competitors' product and know about their pricing.

Example, you are developing a iPhone app, download your competitor's app by paying them the value for it. Use it and see their pricing pattern and the price they attached to it.

This way you not only know their pricing and also you can compare the value you are providing to your customer is higher or lower than your competitors.

answered Nov 16 '11 at 10:14
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Rdr
1 point
  • Thanks for the suggestion but I don't think they could sell it to me. It is a subscription based thing and I don't think anybody but the admins/devs or agents of law enforcement should have access to this information. – Maple Shaft 8 years ago

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