12 ms·

If you try to buy things, it's sometimes desperately frustrating that no one will just quote you a simple price. They have different pricing tiers, and want a s

If you try to buy things, it's sometimes desperately frustrating that no one will just quote you a simple price. They have different pricing tiers, and want a salesperson to talk to you so they can pretend to give you a "special" discount, and all sorts of BS. I'm sure these things work, but they also alienate customers sometimes. People have founded entire businesses on offering clearer pricing schemes.

endymi0n 11y ago
This. With years of experience from dealing with "ask for quote" businesses, this strategy is by now an immediate k.o. criteria for me when considering anything. I may return for your offer only after spending considerable time of not finding any more transparent business (quite rare, but possible for very customized products like renting glass fiber for an office). In practice this never happens and I've been a much happier customer ever since - with my business life cleaned up from 95% of dealing with crappy sales reps.
- cookiecaper 11y ago
  The other side being that, depending on the good, if you have a salesperson, you can often, ironically, get a better price overall. Recent case in the point: I was in the market for a Herman Miller Embody. I would've ordered it online at retail for ~$1500, but I wanted it ASAP so I went to a local HM dealer to see if they kept any in stock (they didn't). While there, the sales person got me a more-upgraded version of the Embody for less than $1000 by invoking dealership and small business discounts. Effectively, I made $500/hr during that trip to the HM dealership. The downside of this experience was that, contrary to my original intention, it took about 5 weeks for the chair to arrive. :\ It would've shipped faster if I had paid full retail from the HM store online. Of course, it's going to depend on the good, but considering that salespeople usually have a strong incentive structure to get your sale to go through them instead of an online retailer or to a competing business, they really will pull out all the stops to keep you around.
desdiv 11y ago
It's a funny world when Elon Musk will openly display "$90M to send 6.4mT of your shit into geosynchronous orbit"[0] and yet millions of businesses selling things that are far less expensive and far more fungible want you to "contact our sales team for a quote". [0] http://www.spacex.com/about/capabilities http://www.spacex.com/about/capabilities
- sosborn 11y ago
  Well, that's a bit apples to oranges. You don't have many options for sending shit into space.
  - restalis 11y ago
    But there can be! Say, they entice customers to bid into a collective launch and then scheme you into all kind of price conditions depending on your load, service priority, or whatnot. ...actually, the more I think about it, this may be a business idea in itself, for the poor suckers who don't afford a solitary launch!
- lmm 11y ago
  Putting x tonnes into geosynchronous orbit is about as fungible as it gets. There wouldn't necessarily be any custom work at all (in practice there's integration work but if you're using a standard satellite bus that can be pretty standard).
  - creshal 11y ago
    That's already more known unknowns than most software vendors have. 95% really boils down to "x licenses of package y, options z and w, additional support at n dollars/hour", which you can put on your website just fine. The "sales teams" are often glorified speech-to-text lackeys that just feed your numbers to an excel sheet, read back the result and then make you believe you're getting special treatment. It's different for software that actually needs integration of some sort (SAP, most of the IBM portfolio, …) but SaaS startups doing this shit are just deluding themselves.
lucaspiller 11y ago
They do alienate customers, and for a lot of companies this is on purpose. Try finding a price for one of Oracle's or IBM's enterprise products on their website - you won't - their products aren't designed for the casual browser, they are designed for directors who have budgets in the hundreds of thousands or millions of dollars range (where strangely the price ends up pretty similar to the budget). This is the type of person they want as a customer, and so all their marketing and sales process targets this type of person. It's not worth it for them to target the small fish, so they purposely push this type of customer away. I do hate when small companies do it though. I'm looking for a new AC unit and so few dealers will just give me a price straight away. I just want to enter my credit card and have it delivered.
- enraged_camel 11y ago
  You're right about the target audience, but wrong about the reason. They don't quote a price because the cost of the product they sell makes up only a small percentage of the overall cost. The vast majority comes from consulting and product customization, which is billable by the hour. And since you don't know the prospect's exact need during the initial engagement, providing pricing would be silly. Source: I work in that exact market. When a prospect asks for a price up front, they basically fail lead qualification. As the saying goes, if you have to ask how much it is, you ain't the target audience.
  - estefan 11y ago
    It's also because it releases less information into the public domain about how the industry works. Less information = greater competitive advantage. It's harder for new entrants to determine 'reasonable' pricing and to position their offerings.
- tajen 11y ago
  I would argue that IBM's business is selling golf courses and Orlando software-and-wine conferences to CEOs, for having witnessed it, because honestly, which sysadmin would accept to run such horrible pieces of software (IBM Rational Suite or IBM FileNet), let alone... pay for it, really? It looks like nothing more than corruption of officers on fiduciary duty. Secret pricing is exactly how they conduct that business: With no public price, employees can't challenge IBM's consultants to provide the value they're charged for. If all from Atlassian to SpaceX publish their pricing, any other behaviour should trigger a SEC investigation.
deleted 11y ago
[deleted]
beachstartup 11y ago
if they don't give you a price, it means they don't want your business. if you don't reach out and ask, then they really don't want your business. they're saving everyone involved a lot of time.
thirdsun 11y ago
Very true - if a company/service requires me to get in touch with a sales guy, wait for a callback or watch a live presentation, product demo or similar, I'll definitely look elsewhere. Unfortunately this seems to be common practice whenever you deal with products/services that target businesses.
rorykoehler 11y ago
Pretty much every company that doesn't display pricing doesn't get my business. There is invariably a competitor that does display pricing and I'll have bought that before the sales rep gets back to me. My philosophy/hunch is that reducing friction equals providing value. I always aim to provide value at every link in the value chain and reducing friction (displaying clear pricing and minimal click instant signup) is an easy way to do that.
- sosuke 11y ago
  I had that experience trying to find out how much a dang AC unit costs. Call for pricing feels like an enormous expenditure to me now.
  - LanceH 11y ago
    Going through this right now. Just got quoted $1400 higher for the same unit I bought last year from the same people. Nevermind that it is for the 2nd floor and wouldn't get used as much and should presumably be a much smaller unit.
- ryanSrich 11y ago
  In the consumer space I 100% agree. Having worked in enterprise though the "no pricing" scheme is par for the course. You don't see SAP prominently displaying their prices online, and for good reason.
  - wesd 11y ago
    What's the good reason? Is it because the pricing strategy is charge as much as the customer is willing to pay?
    - edgarvaldes 11y ago
      Maybe to avoid the competition going [arbitrary amount] dollar cheaper.
    - 11y ago
jmstout 11y ago
But what's your budget though?
gedrap 11y ago
It just depends, there's no rule of thumb for it (although there are obviously wrong cases). For example,you provide SaaS which is applicable to a wide audience, from personal account and tiny teams, to large companies. It's totally fine then to have public pricing for smaller use cases but need to get in touch with sales person to get a larger plan. In this case, your needs probably don't match typical plans (you need a lot of X, and no Y), and the amount of money is big enough to be negotiable. That's cool, since you don't buy these things willie nillie every few days. Speaking of salesmen themselves, it varies a lot from my experience. Some will send you 10 emails during 14 days trial with live demos and trying to arrange a call and shit I don' care about. They do nothing at all to make the sale happen, just annoy a lot. While others just ask for your needs, ask a few questions for clarifications and about potentials needs and give a quote, not trying to arrange pointless calls. I have no problem with this kind of salesmen.
cmdkeen 11y ago
Good luck getting legal to approve the contract that comes with the simple price, or billing to pay the simple price without a purchase order being raised etc etc. I agree with you on the small end of the spectrum - but there is a reason many "Enterprise" level plans are "call us" because the level of hassle involved can be directly tied into the cost you can charge.
petermacrobert 11y ago
Tom Whitwell's post isn't arguing for obfuscated pricing. His argument is that pricing is subjective, and the actual number itself is largely irrelevant from the perspective of an individual consumer. Pricing can still be clearly defined and emotional at the same time. This is the basis of the psychology of price anchoring.
zodPod 11y ago
THIS. When I go to a website that doesn't have prices listed and you have to "Call for a Quote" I move on. I know the prices are going to be garbage and it's not worth my time to deal with the idiots on the other end trying to scheme me into spending money with their company.
- rdl 11y ago
  I'm ok with a mix of transparent and bespoke pricing -- it sucks to see 3 options with set prices, where you actually need something different and are willing to pay. The ideal is some kind of pricing calculator, though. 3 packages and a custom quote generator, or "call".
  - zodPod 11y ago
    That's fair with custom things but when you're on a lab hardware site looking at a centrifuge for a home lab and you're curious how much it costs and they have "Call for Quote" listed, it's just infuriating. There's no customization. I want the centrifuge as pictured. How much is it?!
- drdeadringer 11y ago
  I have spent countless time on the phone just trying to get a number. "I'm interested in XYZ. How much is it?" "Well, with Option A or Option W?" "... How much is either?" "Oh, well that depends on if we make it with pixie dust or faerie magik." "Ok. How much?" "Well, which would you like? XYZ with A from Pixie Dust or XYZ with W made from Faerie Magik?" "How much for either?" "Well, that depends on ..." No. No it does not depend. You have a chart in your hand, I guarantee it. It has pricing on it. Stop the dance. One time, I asked a guy "Can you make this and how much would it cost?". He responded: "We can do whatever you want." Really? I want a number, but you seem to have trouble giving it to me.
stronglikedan 11y ago
I've had people come out to my house and quote me on a project. I've then called them back and told them that it was out of my budget, to which they've then quoted me a cheaper price, hoping that it's within my budget. I've then told them that they should have given me their best price from the start, and I can no longer trust them, because they've already lied to me once. This happens more often than not, and I usually eventually find someone to quote me a price within my budget on the first visit. I understand that that is typically how business is done, or more specifically haggling, but I don't want to haggle. Even if it is outside of my budget, I'll postpone the project until I get the money, and then call back whichever vendor didn't budge on price the first time (and had the lowest price, of course).
- brookside 11y ago
  Somebody revising a quote doesn't mean they were lying the first time around. You may not care for negotiation, but that doesn't mean it is dishonest. Items and services don't have a "real" price, they are only worth what people will pay for them.
  - stronglikedan 11y ago
    As I said, I do understand that. However (and I should have noted this in my original comment), I always tell them up front that I don't like to haggle, and would like their best possible price up front. I also tell them that I am comparing it with at least two other vendors (I always get at least three estimates). Therefore, when they do reduce it, they were lying the first time. I am always very honest with them, and expect the same. Heck, I don't even hesitate to pay them when they screw something up. I pay them promptly, and then hope they will do the right thing. While items and services don't have a "real" price, they do have a "best" price. EDIT: I'd also like to add that, while the article focuses on consumer pricing, I am different when it comes to B2B pricing. E.g. I would quote a successful law firm more than a mom-and-pop shop for consulting services. Back when I was an entrepreneur, I actually lost a couple of contracts because my quotes were too low.
  - restalis 11y ago

endymi0n 11y ago

This. With years of experience from dealing with "ask for quote" businesses, this strategy is by now an immediate k.o. criteria for me when considering anything. I may return for your offer only after spending considerable time of not finding any more transparent business (quite rare, but possible for very customized products like renting glass fiber for an office). In practice this never happens and I've been a much happier customer ever since - with my business life cleaned up from 95% of dealing with crappy sales reps.

cookiecaper 11y ago
The other side being that, depending on the good, if you have a salesperson, you can often, ironically, get a better price overall. Recent case in the point: I was in the market for a Herman Miller Embody. I would've ordered it online at retail for ~$1500, but I wanted it ASAP so I went to a local HM dealer to see if they kept any in stock (they didn't). While there, the sales person got me a more-upgraded version of the Embody for less than $1000 by invoking dealership and small business discounts. Effectively, I made $500/hr during that trip to the HM dealership. The downside of this experience was that, contrary to my original intention, it took about 5 weeks for the chair to arrive. :\ It would've shipped faster if I had paid full retail from the HM store online. Of course, it's going to depend on the good, but considering that salespeople usually have a strong incentive structure to get your sale to go through them instead of an online retailer or to a competing business, they really will pull out all the stops to keep you around.

desdiv 11y ago

It's a funny world when Elon Musk will openly display "$90M to send 6.4mT of your shit into geosynchronous orbit"[0] and yet millions of businesses selling things that are far less expensive and far more fungible want you to "contact our sales team for a quote". [0] http://www.spacex.com/about/capabilities http://www.spacex.com/about/capabilities

sosborn 11y ago
Well, that's a bit apples to oranges. You don't have many options for sending shit into space.
- restalis 11y ago
  But there can be! Say, they entice customers to bid into a collective launch and then scheme you into all kind of price conditions depending on your load, service priority, or whatnot. ...actually, the more I think about it, this may be a business idea in itself, for the poor suckers who don't afford a solitary launch!
lmm 11y ago
Putting x tonnes into geosynchronous orbit is about as fungible as it gets. There wouldn't necessarily be any custom work at all (in practice there's integration work but if you're using a standard satellite bus that can be pretty standard).
- creshal 11y ago
  That's already more known unknowns than most software vendors have. 95% really boils down to "x licenses of package y, options z and w, additional support at n dollars/hour", which you can put on your website just fine. The "sales teams" are often glorified speech-to-text lackeys that just feed your numbers to an excel sheet, read back the result and then make you believe you're getting special treatment. It's different for software that actually needs integration of some sort (SAP, most of the IBM portfolio, …) but SaaS startups doing this shit are just deluding themselves.

lucaspiller 11y ago

They do alienate customers, and for a lot of companies this is on purpose. Try finding a price for one of Oracle's or IBM's enterprise products on their website - you won't - their products aren't designed for the casual browser, they are designed for directors who have budgets in the hundreds of thousands or millions of dollars range (where strangely the price ends up pretty similar to the budget). This is the type of person they want as a customer, and so all their marketing and sales process targets this type of person. It's not worth it for them to target the small fish, so they purposely push this type of customer away. I do hate when small companies do it though. I'm looking for a new AC unit and so few dealers will just give me a price straight away. I just want to enter my credit card and have it delivered.

enraged_camel 11y ago
You're right about the target audience, but wrong about the reason. They don't quote a price because the cost of the product they sell makes up only a small percentage of the overall cost. The vast majority comes from consulting and product customization, which is billable by the hour. And since you don't know the prospect's exact need during the initial engagement, providing pricing would be silly. Source: I work in that exact market. When a prospect asks for a price up front, they basically fail lead qualification. As the saying goes, if you have to ask how much it is, you ain't the target audience.
- estefan 11y ago
  It's also because it releases less information into the public domain about how the industry works. Less information = greater competitive advantage. It's harder for new entrants to determine 'reasonable' pricing and to position their offerings.
tajen 11y ago
I would argue that IBM's business is selling golf courses and Orlando software-and-wine conferences to CEOs, for having witnessed it, because honestly, which sysadmin would accept to run such horrible pieces of software (IBM Rational Suite or IBM FileNet), let alone... pay for it, really? It looks like nothing more than corruption of officers on fiduciary duty. Secret pricing is exactly how they conduct that business: With no public price, employees can't challenge IBM's consultants to provide the value they're charged for. If all from Atlassian to SpaceX publish their pricing, any other behaviour should trigger a SEC investigation.

deleted 11y ago

[deleted]

beachstartup 11y ago

if they don't give you a price, it means they don't want your business. if you don't reach out and ask, then they really don't want your business. they're saving everyone involved a lot of time.

thirdsun 11y ago

Very true - if a company/service requires me to get in touch with a sales guy, wait for a callback or watch a live presentation, product demo or similar, I'll definitely look elsewhere. Unfortunately this seems to be common practice whenever you deal with products/services that target businesses.

rorykoehler 11y ago

Pretty much every company that doesn't display pricing doesn't get my business. There is invariably a competitor that does display pricing and I'll have bought that before the sales rep gets back to me. My philosophy/hunch is that reducing friction equals providing value. I always aim to provide value at every link in the value chain and reducing friction (displaying clear pricing and minimal click instant signup) is an easy way to do that.

sosuke 11y ago
I had that experience trying to find out how much a dang AC unit costs. Call for pricing feels like an enormous expenditure to me now.
- LanceH 11y ago
  Going through this right now. Just got quoted $1400 higher for the same unit I bought last year from the same people. Nevermind that it is for the 2nd floor and wouldn't get used as much and should presumably be a much smaller unit.
ryanSrich 11y ago
In the consumer space I 100% agree. Having worked in enterprise though the "no pricing" scheme is par for the course. You don't see SAP prominently displaying their prices online, and for good reason.
- wesd 11y ago
  What's the good reason? Is it because the pricing strategy is charge as much as the customer is willing to pay?
  - edgarvaldes 11y ago
    Maybe to avoid the competition going [arbitrary amount] dollar cheaper.
  - 11y ago

jmstout 11y ago

But what's your budget though?

gedrap 11y ago

It just depends, there's no rule of thumb for it (although there are obviously wrong cases). For example,you provide SaaS which is applicable to a wide audience, from personal account and tiny teams, to large companies. It's totally fine then to have public pricing for smaller use cases but need to get in touch with sales person to get a larger plan. In this case, your needs probably don't match typical plans (you need a lot of X, and no Y), and the amount of money is big enough to be negotiable. That's cool, since you don't buy these things willie nillie every few days. Speaking of salesmen themselves, it varies a lot from my experience. Some will send you 10 emails during 14 days trial with live demos and trying to arrange a call and shit I don' care about. They do nothing at all to make the sale happen, just annoy a lot. While others just ask for your needs, ask a few questions for clarifications and about potentials needs and give a quote, not trying to arrange pointless calls. I have no problem with this kind of salesmen.

cmdkeen 11y ago

Good luck getting legal to approve the contract that comes with the simple price, or billing to pay the simple price without a purchase order being raised etc etc. I agree with you on the small end of the spectrum - but there is a reason many "Enterprise" level plans are "call us" because the level of hassle involved can be directly tied into the cost you can charge.

petermacrobert 11y ago

Tom Whitwell's post isn't arguing for obfuscated pricing. His argument is that pricing is subjective, and the actual number itself is largely irrelevant from the perspective of an individual consumer. Pricing can still be clearly defined and emotional at the same time. This is the basis of the psychology of price anchoring.

zodPod 11y ago

THIS. When I go to a website that doesn't have prices listed and you have to "Call for a Quote" I move on. I know the prices are going to be garbage and it's not worth my time to deal with the idiots on the other end trying to scheme me into spending money with their company.

rdl 11y ago
I'm ok with a mix of transparent and bespoke pricing -- it sucks to see 3 options with set prices, where you actually need something different and are willing to pay. The ideal is some kind of pricing calculator, though. 3 packages and a custom quote generator, or "call".
- zodPod 11y ago
  That's fair with custom things but when you're on a lab hardware site looking at a centrifuge for a home lab and you're curious how much it costs and they have "Call for Quote" listed, it's just infuriating. There's no customization. I want the centrifuge as pictured. How much is it?!
drdeadringer 11y ago
I have spent countless time on the phone just trying to get a number. "I'm interested in XYZ. How much is it?" "Well, with Option A or Option W?" "... How much is either?" "Oh, well that depends on if we make it with pixie dust or faerie magik." "Ok. How much?" "Well, which would you like? XYZ with A from Pixie Dust or XYZ with W made from Faerie Magik?" "How much for either?" "Well, that depends on ..." No. No it does not depend. You have a chart in your hand, I guarantee it. It has pricing on it. Stop the dance. One time, I asked a guy "Can you make this and how much would it cost?". He responded: "We can do whatever you want." Really? I want a number, but you seem to have trouble giving it to me.

stronglikedan 11y ago

I've had people come out to my house and quote me on a project. I've then called them back and told them that it was out of my budget, to which they've then quoted me a cheaper price, hoping that it's within my budget. I've then told them that they should have given me their best price from the start, and I can no longer trust them, because they've already lied to me once. This happens more often than not, and I usually eventually find someone to quote me a price within my budget on the first visit. I understand that that is typically how business is done, or more specifically haggling, but I don't want to haggle. Even if it is outside of my budget, I'll postpone the project until I get the money, and then call back whichever vendor didn't budge on price the first time (and had the lowest price, of course).

brookside 11y ago
Somebody revising a quote doesn't mean they were lying the first time around. You may not care for negotiation, but that doesn't mean it is dishonest. Items and services don't have a "real" price, they are only worth what people will pay for them.
- stronglikedan 11y ago
  As I said, I do understand that. However (and I should have noted this in my original comment), I always tell them up front that I don't like to haggle, and would like their best possible price up front. I also tell them that I am comparing it with at least two other vendors (I always get at least three estimates). Therefore, when they do reduce it, they were lying the first time. I am always very honest with them, and expect the same. Heck, I don't even hesitate to pay them when they screw something up. I pay them promptly, and then hope they will do the right thing. While items and services don't have a "real" price, they do have a "best" price. EDIT: I'd also like to add that, while the article focuses on consumer pricing, I am different when it comes to B2B pricing. E.g. I would quote a successful law firm more than a mom-and-pop shop for consulting services. Back when I was an entrepreneur, I actually lost a couple of contracts because my quotes were too low.
- restalis 11y ago