RE: Tierred pricing (was Tiger tools...)

["Joel R. Cochran" <jrc@xxxxxxxxxxxxx>]

>We discovered a strange phenomenon - we charge half as much for
>our product which is more capable than the competitors - but we
>find that prospects then assume our product isn't as good, or we
>wouldn't charge less for it. The problem is that when people
>don't know the brand, they use price as a predictor of value. So
>much for being a nice guy.
>
>
>--
>Brad Jensen brad@elstore.com
>President
>Electronic Storage Corporation Tulsa OK USA
>918-664-7276

Brad,

We've experienced the same phenomena.  Our typical software sale is about
half (or less) than that of our biggest competitor.  We' have a pretty good
foothold in our state but don't seem to be taken seriously elsewhereWe've
lost several contracts because of the viewpoint that more expensive is
better!  One of our potential customers even paid 2.5 times for an UPGRADE
to another competitors product than we would have charged for a full
purchase including conversion costs and training time.  We don't even charge
per user license fees, just one nice flat rate!

Part of it ...and I am NOT trying to start anything here... is that our
competitors are all PC based (read "GUI").  Forget reliability, forget ease
of use... it's pretty and familiar to the budget managers.  Even when
prospective clients already have an AS/400 we get RFPs that say "System must
run on a Windows NT4.0 and 2000 network."  I can't wait until they all
happily upgrade to XP only to find that thier Network will now cost them
three times as much per year to maintain... those pesky Passports!

'Nuff said.

Joel R. Cochran
Director of Internet Services
VamaNet.com
800-480-8810 (va toll free)
540-885-8050 (phone)
540-886-1589 (fax)
www.vamanet.com
mailto:custservice@vamanet.com