Our Guest Mentor:
MARK STIVING, PHD, MBA, is Advisor and Chief Pricing Educator at Impact Pricing. Mark is a widely recognized pricing expert and marketing pro who teaches companies how to boost revenues and realize their true value. With 25+ years experience in price segmentation, pricing product portfolios and visionary pricing, Mark’s analytical skills provide specific direction—and quantifiable results.
Sought after as a trusted advisor, Mark has consulted, trained and/or coached hundreds of companies including Cisco, Procter and Gamble, Grimes Aerospace, Splunk, and Crowdstrike. Mark uses a creative but pragmatic approach to help large businesses and entrepreneurs untangle confusion about pricing. All businesses can benefit from Mark’s value-based pricing strategies to capture their true worth, from start-ups to seasoned enterprises.
Pricing has been a lifelong passion for Mark. As a child, he contemplated why companies always use 99 cent price endings, which led to the question, “Do companies think we’re stupid?” He had a chance to study this question during his doctoral program at the University of California at Berkeley and hasn’t looked back since.
An award-winning speaker, Mark speaks at professional conferences for the Professional Pricing Society, International Quality and Productivity Center (IQPC), American Marketing Association, Consumer Electronics Design and Installation Association (CEDIA), Marketing Science and other professional settings. Mark is also the author of Impact Pricing: Your Blueprint for Driving Profits, which has helped business owners answer the fundamental question, “Am I pricing right?”
And launching in October 2021, is Mark’s newest book Win Keep Grow: How to Price and Package to Accelerate Your Subscription Business
At Impact Pricing, Mark teaches two-day, virtual or on-site pricing courses for companies looking to create their own pricing road map to increase revenue. He also helps companies through their pricing issues as an advisor and educator.
Mark holds an MBA in Marketing from Santa Clara University and a PhD in Marketing (Pricing) from the University of California, Berkley, Hass School of Business. He is based out of Reno, Nevada, United States of America.
Key Quotes from the Episode:
[On the importance of engineering and sales in pricing] “when I think about pricing, I think about it as not only do I have to get the number right, but I have to be able to communicate the value so people are willing to pay that number.” [02:05]
[On increasing pricing] “And then once you start thinking about value, then you start thinking about how do I create products that actually have value so I can put a bigger number on it. And so I think of pricing is creating. Communicating and capturing value.” [02:15]
[On a key tool for finance to leverage in pricing] “they have influence in the company. Everybody in the company is scared of finance worries about what finance thinks, right. Finance can snap their fingers in the rest of the company jumps. It’s like, okay, They hold the purse strings. We’re going to do what they ask. And so finance could drive a shift of culture or mindset towards everybody thinking about value just by asking questions about value it.” [05:34]
[On an opportunity for finance professionals] “I’d say way the vast majority of their time on the cost side of profitability. And not on the revenue side of profitability. Sure. They’re watching revenue, but they’re not pushing it where they’re pushing cost reduction initiatives. And so I think if they spent more equal time on the revenue side, I think it would make a huge difference.” [11:12]
[From Mark’s parting thoughts] “My attitude always has to be, how can I help you? Because maybe by the way, you’re always thinking of you and I’m always thinking of me. [32:17]
Key Points from the Episode:
- How finance professionals typically think about the word “value.”
- The significance of thinking in will I and which one terms
- Why finance people are the best (have so many tools that help capturing value) and not the best for pricing value
- Two key trends in pricing to keep an eye out for, particularly subscription based models
Stamped Show Notes
[00:16] Mark delves into his career journey from engineering, sales, gaining an MBA, earning his doctorate in Marketing & Pricing, starting a company, selling it, to now coaching and teaching pricing.
[01:56] How his engineering & sales experiences have helped out Mark immensely as a pricing expert.
[03:18] How finance professionals typically think about the word “value.”
[04:40] Why finance people are the best (have so many tools that help capturing value) and not the best for pricing value (don’t understand value from perspective of customer).
[06:46] Mark deconstructs the “will I” (popcorn at cinema captive market) vs. the “which one” (iPhone – no competition considered less price sensitive) value decision.
[09:30] How Finance can help pricing immensely (creating, sharing and analysing KPIs such as average selling price) so they can make better decisions
[11:17] We discuss where Finance might be guilty of spending too much time on the cost reduction side of profitability and watching revenue but not enough pushing the revenue side.
[12:00] What’s exciting Mark most about his current work.
[13:00] Two key trends in pricing to be aware of (does subscription fit in my industry, and if running subscription focus on growing customers) as well as the importance of win keep and growing customers.
[16:30] Why subscription companies don’t do a great job of growing customers.
[18:05] The importance of net dollar retention (Zoom 140%)
[19:30] Mark shares his best bit of advice (be an expert).
[21:30] Marks dis-evaluates his phD and the difference between becoming an expert and becoming known as an expert, and how it’s important to give it away in the beginning.
[25:19] Mark recommends a few books our audience check out and we deconstruct all of them.
[29:44] How to best connect with Mark.
[30:03] Mark shares his parting thoughts to the audience.
Resources Mentioned:
Free: How Today’s Smartest Businesses Profit by Giving Something for Nothing Paperback – April 20, 2010 by Chris Anderson (Author) https://www.amazon.com/Free-Smartest-Businesses-Something-Nothing/dp/140131032X
Monetizing Innovation: How Smart Companies Design the Product Around the Price Hardcover – May 2, 2016 by Madhavan Ramanujam (Author), Georg Tacke (Author) https://www.amazon.com/Monetizing-Innovation-Companies-Design-Product/dp/1119240867
Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts Paperback – May 7, 2019 by Annie Duke (Author) https://www.amazon.com/Thinking-Bets-Making-Smarter-Decisions/dp/0735216371
The ONE Thing: The Surprisingly Simple Truth Behind Extraordinary Results Hardcover – April 1, 2013 by Gary Keller (Author), Jay Papasan (Author) https://www.amazon.com/ONE-Thing-Surprisingly-Extraordinary-Results/dp/1885167776
Connect with today’s guest:
Email: [email protected]
Website: https://impactpricing.com/
LinkedIn: https://www.linkedin.com/in/stiving/
Complete transcript:
#338 Price For Value And Gain The Competitive Advantage with Mark Stiving
Andrew: [00:00:00] Hi everyone. And welcome to this week. Strengthened the numbers I’ve read excited to share with you this week’s guest mentor, Mark Stiving
[00:00:36]because Mark brings a wealth of pricing expertise to bear, and not only get across key concepts, but he does it in a non consultant speak type way, just using normal language and just some fascinating insights, not just from the pricing, but also Mark’s career as well. And how we got into pricing. And in particular, he tailored some of advice for our finance and accounting audience. At, we start by discussing how finance professionals interprets our, think about the word value and pricing,
[00:01:06]and then we go and deconstruct some decision-making around pricing, which is the will I versus which one situation. Mark also pays finance people, a huge compliment by saying why we might be amongst the best groups to do pricing. However, also temper that by saying there are some things we can do better to.
[00:01:26] help create and capture the value that pricing can drive in our organizations. We also look towards the future and two key trends happening at the moment that we need to keep an eye out around pricing, particularly when it comes to subscription based models. And then just some fantastic key advice.
[00:01:43] Mark shares towards the end of our time together I highly encourage you to listen all the way through on this one.
[00:01:50]now, if you do happen to enjoy this week’s episode, please remember you can subscribe and recommend the show to your friends and colleagues. We’re on all the major platforms, iTunes, Stitcher, SoundCloud, YouTube, and Spotify. And if you want to know more about Mark, some of the key quotes transcripts of the interview,
[00:02:06]links to the resources recommended a more, you can check the episode out at sitnshow.com.
[00:02:12]And I think that’s enough for me for now. So without further do over to Mark.
[00:02:20] Mark. Welcome to the show.
[00:02:22]Mark: [00:02:22] Thanks Andrew. Good to be here.
[00:02:23]Andrew: [00:02:23] It’s our pleasure to have you. And I really enjoyed our conversation previously as well. I’m really excited to share you with our audience, but before we jump into that, would you mind maybe taking our audience through a brief history of your background in finance and pricing?
[00:02:36]Mark: [00:02:36] Yeah, so. Not much of a finance person. But I actually have a bachelor’s in science and electrical engineering from Ohio state, the Ohio state university. I was an engineer for a few years and I remember being an engineer and looking around the room and seeing the sales people.
[00:02:53] And they looked like they were having fun. And so, so they were taking people to lunch. I thought I could do that job. And I transferred into sales. And let me assure you, I was horrible, right? I did was not a good salesperson. And so then I decided that I needed a career change. And what do you do when you need a career change? You go get an MBA. So I got an MBA at Santa Clara university then Decided, I, I just fell in love with going to school. Right. I don’t know if you’ve ever tried this, but when you go to class, not hung over, you can learn a lot.
[00:03:26]Andrew: [00:03:26] yeah. And your brain cells will thank you as well. Take some of the pressure off. So
[00:03:30] Mark: [00:03:30] Exactly. It’s not. So I fell in love with going to school. I asked my wife, if I could get into Berkeley or Stanford, could I get a PhD? And she said, sure. Thinking I wasn’t going to get in. So luckily I got into Berkeley and I have a PhD in marketing. I like to say pricing because all my research was in pricing.
[00:03:46]And and from there I went on, I was a professor for four years. I was a director of pricing at some pretty big companies. For a bunch of years. I started a company sold it. And then I started teaching product management, product marketing, and pricing through a company called pragmatic institutes.
[00:04:03] I left them a couple of years ago and now all I do is coach and teach companies about pricing
[00:04:07]Andrew: [00:04:07] Oh, fantastic. So, so like th the common theme, once you finish up engineering and sales has been pricing all the way through that, right. It’s a.
[00:04:16]Mark: [00:04:16] so let me say yes, but let me also say. The engineering and the sales stuff helped me immensely. Because when you think about pricing, when I think about pricing, I think about it as a, not only do I have to get the number right, but I have to be able to communicate the value. So people are willing to pay that number.
[00:04:36] And then once you start thinking about value, then you start thinking about how do I create products that actually have value so I can put a bigger number on it. And so I think of pricing is creating. Communicating and capturing value, which has helped the sales piece in particular helped me a ton and engineering product development.
[00:04:54] Just the thought process helps a lot.
[00:04:57] Andrew: [00:04:57] Yeah, it’s actually, it’s really interesting because. As a listener to know we have this concept, we touch on that on a game called the value ladder. And I have to start at that because it’s aimed at accounting and finance professionals. There’s an awful lot about protecting that value to begin with safeguarding assets and so on.
[00:05:13] But beyond that, the next steps are creating value and capturing it. And I just feel that we’re probably making some venturing towards the creation, but the capturing probably is the area where we could do an awful lot better. So for some people maybe coming more from a finance background, Yeah. Or maybe come up through the accounting streams, where could they start to begin to effectively trying to go out and create and capture value for their organizations
[00:05:38] Mark: [00:05:38] yeah. Great question. And let me take a brief step back and put myself in the shoes of an accounting or finance person for a second. And typically when they hear the word value, they’re probably thinking what’s the value of our company, right? What’s the market value. What’s the market cap of our company.
[00:05:57] And if you think about how you put a value on that, right? The value on that is typically what’s someone else going to pay for it? How much is someone willing to pay my pay for my stock? And we start thinking about what are the things I could do to get that market cap higher? What are the things I can do to get my stock price higher?
[00:06:14] The next round of investment higher? And the thinking is exactly the same thinking when we start talking about. I need to create a product. So my customer is willing to pay more for my product or my customer. I could find more customers who are willing to buy my product. It’s the exact same thought process.
[00:06:33]Andrew: [00:06:33] So it’s cause and again, I was just starting to think, because I suppose I’m fine. It’s I like to think we have that broader perspective thinking about the company’s value first and then deconstructing that to helping our customers identify value and then capture some of that. Do you feel like we have maybe a bigger role to play in that and just not leave it all on the sales and marketing organizations to be figuring this stuff out?
[00:06:56]Mark: [00:06:56] Can I say, Oh my gosh. Yes.
[00:06:58]Andrew: [00:06:58] I was a loaded question in fairness. Yes.
[00:07:02]Mark: [00:07:02] So I love finance people for pricing and finance people. Aren’t the right people for pricing. So let’s talk through that for just a
[00:07:10]Andrew: [00:07:10] Yeah.
[00:07:10] Mark: [00:07:10] The one thing finance people don’t know. Is the value of our product. They’re not out talking to customers and marketplace all the time. They don’t know how our product is going to help that customer improve and how they’re, how our products different than our competitors product and what the value is of those differences.
[00:07:30] So let’s just, let’s confess or admit and it’s not even their job that finance people don’t understand value from the perspective of the customer. But finance people have so many tools at their disposal to help the company. Capture more of the value that we’re creating. And so when we start thinking about what are those tools first off the thing that finance has that I love the most is they have influence in the company. Everybody in the company is scared of finance worries about what finance thinks, right. Finance can snap their fingers in the rest of the company jumps. It’s like, okay, They hold the purse strings. We’re going to do what they ask. And so finance could drive a shift of culture or mindset towards everybody thinking about value just by asking questions about value it.
[00:08:24] That’s why I think that’s one thing that they could do. That’s fantastic.
[00:08:27]Andrew: [00:08:27] I
[00:08:27] Mark: [00:08:27] second, Oh, go ahead.
[00:08:29] Andrew: [00:08:29] I was going to say just on those questions I’d always interrupted your flow there, but Mark book on those questions, are there any sort of good questions to start on picking that value or get people to appreciate it better?
[00:08:40] Mark: [00:08:40] Yes. Yes. So first let’s say that I think that finance people need to understand what value means to a customer. Right. They don’t have to know our value, but they need to know what does it mean to have value?
[00:08:53] Andrew: [00:08:53] Yeah. Yeah.
[00:08:54]Mark: [00:08:54] And so. I often teach companies about value. What does value mean? How do you find it?
[00:08:58] And then we do these exercises to go find their own, but I’ll give you a couple pointers, a couple of quick thoughts on that. And the first one is I love this concept. Most people, when they buy a product, they make two different decisions. They first say, will I buy something in the product category? I say, okay.
[00:09:15] Yes, I’m going to now, which 1:00 AM I going to go by? And people when the buyer is making those two different decisions, they think about value differently. And sometimes in our products, customers never go on to compare us to a competitive alternative. And if that’s the case, then we need to be thinking about value the way our customers are thinking about value.
[00:09:36] And we call that the Willa decision. Right? So I’ll give you two examples of, will I products that are just easy and fantastic. One is popcorn at the movie theater, right? Popcorn is ridiculously expensive. And the reason is there’s no competitive alternative.
[00:09:51] Andrew: [00:09:51] Yeah. Yeah. Captive audience, literally.
[00:09:53] Mark: [00:09:53] Yes. Another example of a Willa product is the Apple iPhone. I will bet you that if you are using an iPhone today, you are thinking to yourself, am I going to upgrade to the next iPhone or not? And what you’re not thinking is am I going to upgrade to the next iPhone or buy an Android?
[00:10:12]Andrew: [00:10:12] Yep.
[00:10:13] Mark: [00:10:13] so you’re not considering a competitive alternative once we understand, and we can think the way our buyers are making decisions, we can think about what does value mean.
[00:10:23] And by the way, if someone’s not comparing us to competitive alternatives, they’re not very price sensitive, right? Price is not driving that fact, that decision something else is driving that decision. And so we should understand that we should recognize that we should price for it. But now, if you don’t understand that concept of will I, in which one, how do you price for will I versus which one? So it’s a really fascinating concept.
[00:10:44] Andrew: [00:10:44] Yeah, I think it’s I could just imagine now we’ve got some finance professionals at listing ed and some CFOs as well, and just thinking. My God, they’ve got to sound much more intelligent in commercial conversations now asking the wheel I R, which I type type questions to unpick it.
[00:10:59] But actually I really like that framework because the motions to market a very slightly different and the types of questions are flow on are slightly different, depending it’s will I R to which question? So that’s actually, that’s really, so look I’m not making any apologies now for dropping your flow
[00:11:16] I’m glad I did cause they’re very useful questions, Mark, but I think you were moving onto a second point as well. On other ways we could start looking at creating and capturing value.
[00:11:25]Mark: [00:11:25] Yeah, so, so the first one let’s say is once this finance person understands what value means that helps them figure out what are the questions I want to ask. And by the way, they don’t know the answers, but they can recognize if the answer is a reasonable answer and has the person there. They’re talking to thought through the questions themselves,
[00:11:42] Andrew: [00:11:42] Yes. Yes. I’ve, it’s like as a coaching or advisory type role, right. It’s we’re not, we don’t have to know the answers. It’s just asking good intelligent questions.
[00:11:50] Mark: [00:11:50] Absolutely. And then the second thing that finance people, this is an asset that finance people have. It’s a way that they can help pricing immensely. And that is by spending time on new and the relevant KPIs, right. Finance has access to all the data in the entire company. And they could create KPIs to help companies start thinking about revenue, not just are we getting revenue, but what about ASP average selling price per product?
[00:12:20] What about average selling price per region? What about average selling price per, pick some cohort of customers? So what are the ASP trends looking like? What are the ASP’s for new products versus existing products? Right? These are all things that we can start thinking about. How do we share data with the company, with the product managers, with the product marketers, whoever’s making pricing decisions so they can make better decisions around creating value, capturing value and communicating value.
[00:12:51] So I think the data piece is huge.
[00:12:54] Andrew: [00:12:54] Yeah. looking at data. I suppose we might’ve been guilty in the past of using data to look at things like activities and driving costs down or minimizing cost. But when it comes to the pricing, it really gives us an opportunity to maximize value for customers. And also our organizations too.
[00:13:11]And it’s similarly like asking questions on and following it through and making sure it does a coherent strategy, coherent logic behind what we’re doing. I think we have the skills to do that. It’s just maybe new territory. It’s not our comfort zone.
[00:13:25]Mark: [00:13:25] I think that’s absolutely right. If you think about most people in finance and accounting, and I don’t mean this in any derogatory
[00:13:31]Andrew: [00:13:31] No.
[00:13:32] Mark: [00:13:32] they spend, I’d say way the vast majority of their time on the cost side of profitability. And not on the revenue side of profitability. Sure. They’re watching revenue, but they’re not pushing it where they’re pushing
[00:13:47] Andrew: [00:13:47] Much.
[00:13:48] Mark: [00:13:48] They’re pushing cost reduction initiatives. And so I think if they spent more equal time on the revenue side, I think it would make a huge difference.
[00:13:57] Andrew: [00:13:57] Yeah I completely agree that maybe cause I’m a bit of a pricing geek myself. I’m not a specialist, but I lead a team of it. And again, I just fascinated by the value. We can go add just by asking some more intelligent questions and I’m putting a bit more focus around it. So, so Mark really appreciate enlightening that for us, in terms of yourself what’s exciting you most about your current work at the moment?
[00:14:21]Mark: [00:14:21] I have, I’ve built one of the most unusual companies in that. I just, I don’t do consulting. I’ve decided I only want to do things I want to do. And so what I want to do is I love teaching about pricing and I love advising companies about pricing. And so I have several companies where I do a weekly phone call and we tackle pricing problems.
[00:14:43] And as you’ve already heard me say, pricing is way bigger than putting a number on something it’s really understanding value. And what’s the value of our products and how do we choose market segments? So I get the biggest thrill out of helping people be successful in their companies. And I get to do it every week.
[00:15:00] So to me, that’s, what’s exciting.
[00:15:02] Andrew: [00:15:02] Yeah. I see light up when, you know you were talking about that Mark some people say that’s living the dream, yeah. Do you think from a pricing perspective, what, why does it upcoming developments we should all be aware of where pricing might be going or where there might be future opportunities?
[00:15:17] For us to go into create more value out there.
[00:15:20]Mark: [00:15:20] Yeah I’ll give you the two that I think of an actually this the same one, but it’s a nuance. If your company is not going subscription today. So if you haven’t bought a subscription business model in place yet, then. Maybe it’s maybe your industry or situation is not appropriate for it, but I gotta say that if it is appropriate and you’re not doing it, someone else is gonna do it.
[00:15:43] So you should be thinking about does subscription fit in my industry and how could I make it fit? And that’s a really big deal. And then the second one I’ll say is if you are a subscription company, so you’re already running subscription. I would say the vast majority of companies I talk with do a good job at understanding there’s three revenue buckets in a subscription business.
[00:16:08] And most companies do a really good job at understanding the first two. And that is I have to win customers and I have to keep customers, right. And they rarely spend energy and effort doing the third one, which is I have to grow customers.
[00:16:22]Right.
[00:16:22] Andrew: [00:16:22] Expansion. Yeah. Yeah.
[00:16:24] Mark: [00:16:24] Exactly. So, yes. Let me use consultants, speak acquisition, retention, and expansion.
[00:16:29] Andrew: [00:16:29] Sorry, I couldn’t resist. I couldn’t resist, although, but they point out to me right by the acquisition one and you’re completely right. That’s how it was introduced to me Mark. But they said no, you shouldn’t acquisition. That’s very derogatory. It’s like very something that finance would say I’ve been financed.
[00:16:44] Why you expect to say, Oh, customer creation. I was like, okay. Okay. All right. Okay. I can use that. That’s not too far of a jump, but yeah. So acquisition retention. Expansion. I it’s actually, it’s really funny knowing these things on the other side, again, it’s just for our audience benefit. So again, a lot of these subscription models are like insurance or cell phone contracts or whatever.
[00:17:04] And when it comes up that time for Newell Mo knowing this information that we know costs, cost companies have budgets to retain customers. It’s much cheaper to retain a customer than acquire a new one. I don’t know what the ratio is now. Is it three or four X? I can’t remember, but I, and I don’t know if that’s changed over time, but it does mean that if you do want to save some money personally, or for your business, you phone up around that time, the renewal, and you can negotiate a better deal because the company has got a lot more leeway to give you a good deal.
[00:17:31] So actually you can use it both ways. For those that are cost minded at the moment, yes. Take this information and go and save your company some money on their costs. But I think the value is looking at are the value we offer customers. And seeing if a subscription model or recurring revenue model is perhaps where we should be moving, because if we don’t, as you said, Mark, someone else is probably going to do it.
[00:17:54]It could be the right move to even defensively. It could be the right move, but, I that’s, I never thought about it that way.
[00:18:00]Mark: [00:18:00] Quick plug. I just wrote a book called win keep grow.
[00:18:04]Andrew: [00:18:04] Yes.
[00:18:05] Mark: [00:18:05] Which is why I use the words win, keep and grow all the time. That, and it’s easy to say and people remember it and
[00:18:10] Andrew: [00:18:10] Oh, actually that’s much nicer. Yeah. It’s less financing. Wouldn’t keep, grow up. Pretty
[00:18:15] Mark: [00:18:15] I try hard not to speak in consultant, speak.
[00:18:18]Andrew: [00:18:18] Yeah, I could I, yeah, I’ve definitely in our previous conversation. This, I know, I completely agree Mark. And actually it’s really refreshing because again, sometimes you can get with these technical terms and actually the essence is winning, keeping it growing customers. I love it. I’m going to buy I’ve actually, we’ll just take that going forward now.
[00:18:35] Mark: [00:18:35] Go ahead.
[00:18:36] Andrew: [00:18:36] I can always plug your book then at the same time, it’s like, Oh, if you want to know more about this, I
[00:18:40]That’s mutual value creation. That is
[00:18:43] Mark: [00:18:43] Back to the key point though. And that was subscription companies. Don’t do a good job at growing customers, right? If you think about how you grow a customer, you grow a customer by getting the past more money next year than they paid us last year. And that’s going to happen either because we raised prices.
[00:19:00] So now we have to think through what’s a price increase look like, and how are we going to make that happen? We could do that because the customer has grown and they’re using more of our product, but that only makes sense. So that only works. If we chose a good pricing metric for how we’re going to charge for our products we could grow customers if they upgrade to a new package.
[00:19:23] So we would think of it as upsell on our side or upgrade on from their perspective. Now that only works if I created packaging so that it makes sense for people who are getting more value from my product to upgrade from the good, to the better, better, to the best.
[00:19:36] Andrew: [00:19:36] right? Yes.
[00:19:37] Mark: [00:19:37] And then the last one, the last way you can get a customer to pay you more is through cross sell.
[00:19:42] And once you built a great relationship, could I build more things for that customer, that type of customer that would buy that they would buy it from us. But I gotta say companies don’t think about those things. I just told you.
[00:19:53] Andrew: [00:19:53] No it’s actually I’m not going to name names or particular companies. But it is really interesting that grow one does seem to be a bit of an afterthought. And it’s just like on top of potential.
[00:20:03] Mark: [00:20:03] But by the way, it should be an afterthought. In the following sense. If you’re a new startup company, you don’t care about growing your customers, you got to care about winning them and keeping them. But once you’ve built a decent sized user base, now we should be thinking how do I get more money from that user base?
[00:20:21] Because you may have heard the statistic net dollar retention and net dollar retention essentially says, if I take a cohort of customers and I count the dollars that I’ve turned out. So people who left me. And I count the dollars of the grow revenue buckets. How much did I get from that cohort of customers a year later?
[00:20:43]And companies like zoom, when they go public, they’ve got a net dollar retention, number of 140%. So that means they’re getting 40% more revenue a year later from their current customer base that even counts people who stop using zoom. Now, I’m not sure who stopped using zoom, but still.
[00:21:00]Andrew: [00:21:00] No, but like that’s what a great example, a market I’ve had a phenomenal year and a bit actually. So, it’d be interesting how that changes. Oh, right.
[00:21:09] Mark: [00:21:09] this year.
[00:21:10] Andrew: [00:21:10] Goodness. Yeah. So, so yeah, so, it’d be interesting to see. Yeah, no I’d have to check that one out. I actually don’t know where it’s at the moment, but that’s fascinating.
[00:21:17]That’s a heck of a net retention,
[00:21:20] Mark: [00:21:20] Yeah. And I only know that because it’s in their S one, when they filed to go public.
[00:21:25] Andrew: [00:21:25] Wow. We’ll have, we’d have some roared ins checking that out before we even get to the end of this podcast. It’s just the way our minds work know like seriously. Again I, again, I will put a link to the win, keep grow book. Into our show notes for audience to go click on and check out. And and I know you’ve written some other books as well, Mark.
[00:21:43] So again, we can include some links there as well. I suppose Mark, look, you’ve given us some great advice. There what’s been the best bit of advice you’ve received throughout your experience, your career, and so on.
[00:21:53]Mark: [00:21:53] So, although this is semi pricing advice, it’s actually not, this is career advice and I’m going to give this to everybody and that is be an expert. It doesn’t matter what it is, be an expert. And so if I could go back in my career for a second, most of my jobs were always, I want to run away from that last job.
[00:22:15] So what can I find to do next? And it wasn’t ever a strategic, what’s the right thing to go do, right? What should I be planning on and where should I go? And, I’d lucked out and done things well. But then I ended up in 2008, finding myself without a job and the market was down. I was in a huge depression.
[00:22:34] I finally get myself a job because I could pretend to be a pricing expert because I have a PhD in pricing and I taught pricing again. So I get a pricing job. And and it was really hard to get this job. And I said to myself, after I got it, that is never going to happen to me again. So I started blogging about pricing.
[00:22:54] I wrote my first book on pricing and once I committed to becoming a pricing expert and being known as a pricing expert doors have just opened up for me. Right. Things just happen.
[00:23:05] Andrew: [00:23:05] Yeah it’s re it is really interesting. The way you’ve described it reminds me so much of a similar point of advice. We also heard from another mentor on the show actually based out of South Africa. And he wants to become such an expert. He went away and he read through in retail finance.
[00:23:19] So, so driving finance, but in retail, within his country, he went away and read the annual report for the last five years of every retail concern. Public retail attorney. And he said, you could learn so much by coming an expert to all the people are already doing. It’s just cause you’re you’ve really committed to the exercise and he’d be in a board meeting or a management meeting and something had come up and he’d be able to reference something that would work or perhaps didn’t quite work out so well.
[00:23:46]So, so even shorter getting a PhD, which by the way will be very useful, I think.
[00:23:50]Mark: [00:23:50] so let me disvalue of that. Right. I think a PhD was good for me in that it gave me the confidence to do what I did, but in all honesty, anybody can go do what I did. You don’t need a PhD. So I.
[00:24:04]Andrew: [00:24:04] No. I was thought I was going to say Mark, but when you said about the blogging and so on, and you’ve got your own podcast as well. Like D w is that sort of commitment to the expertise is just turning up and just keeping at it and keep evolving your thinking are, of course, cause when you say you don’t necessarily need the PhD, anyone can do it.
[00:24:20]It’s not what people could do is the blogging, the podcasting or whatever.
[00:24:23]Mark: [00:24:23] Yeah, I hadn’t thought of this until we just had this conversation, but there’s really two sides to this. One side is becoming an expert and the other side is becoming known as an expert.
[00:24:34] Andrew: [00:24:34] had known as an expert. Yeah.
[00:24:35] Mark: [00:24:35] Right. And so you’ve got to decide how you want to become known as an expert. Me, I love sharing this book that I just wrote Winky growth.
[00:24:43] The reason I wrote the book is because while I was studying subscriptions, I just had a hard moment after aha moments like, Oh, that’s different. Oh, that’s different. Oh, that’s different. And I just wanted to share it.
[00:24:54]Andrew: [00:24:54] Yeah, no I completely get it. I still want, I’ve lacked an essence. But my first book was just an amalgamation of those aha moments. It’s probably similar to your book, right? It’s just those aha. Oh, I want to share this because it’s really helped me help build. There is so why not share it, and it’s like it, that it compounds and then that’s how you become known as an expert in a certain area.
[00:25:14] So I guess I guess look an audience at there’s a well-trodden path here. Hopefully Mark Brock’s advice helped straighten it out a bit because we all know our careers can be topsy-turvy and bits and pieces. So, no great advice. Mark. So thanks for sharing that.
[00:25:30]Mark: [00:25:30] The other thing I would say is have the attitude of giving away as much as you can, as you become an expert. As you become an expert, just give, and then over time, you’ll figure out how do you monetize it? How do you charge for it? What are you going to charge for? But in the beginning, just give it away.
[00:25:50] Andrew: [00:25:50] I know it’s CA I know it’s counter-intuitive remind me of the book I read a long time ago by, I think it was Chris Anderson, the guy behind the Ted talks. I think it’s called free. And essentially it was just giving it away. He talked about things like the long tail and so on, but I actually have to say my own experience.
[00:26:06] That’s. That’s a very good strategy, not a, not only as as a business person, per se, which is my stuff outside my day job, but within an organization actually it’s a very good approach because I think a lot of people are fearful about sharing their knowledge. But true experts does.
[00:26:23] There’s no, there’s only a market of one reading. You’re only competing with yourself. So I think it’s a really good approach, whether you’re within an organization like an Oliver audience, or are running a practice or are out there on your own giving away actually is probably a damn good strategy for effective one, actually.
[00:26:40] Mark: [00:26:40] Absolutely. And let’s just use a quick example right earlier in this podcast we talked about will I versus which one? Right. So this is something that I created. It was a mindset that I came up with because of a situation I was in. It’s like, Oh my God, that is so important. And I tell everybody, but I would challenge anyone to go apply that.
[00:27:01] Because it’s hard. Right? You heard me say it, you said, yeah, it makes sense. And then you’re going to mess it up. Cause you don’t really know. Is this a, will I, is this a, which one? How do I create the, which one? And then you say I need help. Guess who you’re gonna.
[00:27:13]Andrew: [00:27:13] Yeah, right. Or I could like the tried, it didn’t quite go as expected. They need help, or just bounce something off. I completely agree. I absolutely love it. And it just multiplied on across all the different disciplines out there, the things that need to get done that makes complete sense.
[00:27:29]Mark great advice. I suppose if our audience are looking to start, get familiar with some good resources there, any sort of books or documents you can recommend or ordinance go check out,
[00:27:39]Mark: [00:27:39] so let me see, what have I read that I really liked? I love the book monetizing innovation from modern ramen. And so that’s a pricing book,
[00:27:48] Andrew: [00:27:48] I never come across it. Yeah. Monetizing innovation.
[00:27:51] Mark: [00:27:51] it is a think of it as product management and pricing combined. Yeah, and I think that’s it was just a fabulous book. I really liked it.
[00:28:01]There was a book that influenced the way, I think a lot called the one thing I think is what it was called. I’m not a hundred percent sure. But it was really about picking the thing you want to focus on and go focus on it. Right. Do
[00:28:14] Andrew: [00:28:14] it was what was the one that I was a venture capitalist or something wrote that one or something like that. Someone from Silicon Valley.
[00:28:21] Mark: [00:28:21] I feel so bad that I’m not giving somebody credit for their work.
[00:28:24] Andrew: [00:28:24] Shadow. I know the one. I think I actually, I three, I’ve been really embarrassed because I actually think I’ve got it as an audio book somewhere
[00:28:32] Mark: [00:28:32] pop it up in Kindle as we speak.
[00:28:33]Andrew: [00:28:33] Oh, who is that? No, is that I read it by Gary Keller. That’s the one.
[00:28:38] Mark: [00:28:38] Yes. Yes. Gary Keller. That sounds right to me.
[00:28:41] Andrew: [00:28:41] Yeah, I think he was, I think he was like the student of someone and he wrote down someone’s lecture notes and that’s this one thing I got a feeling. That’s what it is, but but I’d have to go clarify that. I don’t want to steal his thunder.
[00:28:53]Mark: [00:28:53] Oh. I just popped open my Kindle. I don’t remember what I read until I see it, but here’s the one that you got to see this. I love the book thinking in bets by Annie Duke.
[00:29:04] Andrew: [00:29:04] Oh, that’s a new one to me. Thinking of about why is that way going? Why do you love that one?
[00:29:10]Mark: [00:29:10] so Annie Duke is a professional poker player. And so she’s talking about, she’s not talking about poker in the, she uses it as an example, but she’s really talking about decision-making and how we never have full information when we make
[00:29:26]Andrew: [00:29:26] Completely sure. Yes.
[00:29:28] Mark: [00:29:28] And so how do you think about the decision? And I don’t want to ruin the entire book, but I’m going to give you the lesson that I took away from it, which I thought was incredible. And that is You can make a bad decision and have a good outcome, and you can make a good decision and have a bad outcome. So you need to think through, did I make a good or bad decision and not just look at what the outcome was?
[00:29:53] Andrew: [00:29:53] yep.
[00:29:53] Mark: [00:29:53] And my favorite example of what she does of her describing this is imagine, go out to a party one night, you have a bunch of drinks you get in the car, you drive home and you got home safely. Was that a good decision or a bad decision?
[00:30:09]Andrew: [00:30:09] Yeah. See, I get, it depends on our audience’s perspective here. Right. What I have to say, the fact that you got home is a mere miracle.
[00:30:16]Mark: [00:30:16] that’s the point, right? And by the way, maybe you get home 90% of the time or 95% of the time or whatever the heck it is but it’s still a bad decision.
[00:30:25] Andrew: [00:30:25] yeah. A hundred percent. Yeah. Yeah. It’s a, it reminds me of that scene of the Wolf of wall street. And he tries to get home. It was a bad decision. The car was a wreck. Thank God. No one was killed, so yeah but no, that’s a great example. I’m going to have to check that one out.
[00:30:39]I’m really curious now you’ve really piqued my interest. You saw me on that one, Mark?
[00:30:44] Mark: [00:30:44] Yeah. So, so the point let’s make this practical for a second, right? The point is we often we, as people often take a look at our successes and say, I did that, right. That was me. That was my brilliant decision-making. And then we look at our failures and say, Oh no. If someone else caused that,
[00:31:01] Andrew: [00:31:01] Yes.
[00:31:02] Mark: [00:31:02] Right.
[00:31:02] That wasn’t me. That wasn’t my decision, but can we step back and honestly look at our own decisions and say, yes, that was a decision. No, that wasn’t a good decision. And by the way, I confessed to one earlier in the podcast already. I said early in my career, I didn’t make strategic decisions on what I was going to go do.
[00:31:21] Next. I just said, I’m running away from that. Can I say, running away from your last job is a bad decision. Creating a strategy and a plan for where you want to go in your career is a good decision.
[00:31:32] Andrew: [00:31:32] Yeah, I actually I’ve got to come right back to that point that this podcast would not have happened if it wasn’t for someone picking me up on that one, Mark. I definitely was the type of person running from job to job. And then they gave me a strategy, a framework to go execute against, and that’s helped, not just me, many other people and finance and accounting.
[00:31:49] So it’s really wonderful advice. Really touched a nerve for me. So, so again, thanks for sharing, sharing that one again. Awesome stuff. Look, I’ve enjoyed our conversation, but if our audience wish to reach out, continue the conversation. So my where’s the best place to connect with you at
[00:32:04] Mark: [00:32:04] Yeah, two things. Send me an email [email protected] or I’m on LinkedIn a lot. So feel free to find me on LinkedIn.
[00:32:13] Andrew: [00:32:13] awesome. So they’ll go into the show notes as well. Mark, look again, thanks for sharing so much advice, but before we, we let you get away from us. Is there any sort of parting thoughts you can share with our audience?
[00:32:23]Mark: [00:32:23] Okay. Is it okay if it’s a long parting thought?
[00:32:27] Andrew: [00:32:27] Oh, God. Yeah. Geez. More value for us.
[00:32:30]Mark: [00:32:30] So I think another one of my huge catastrophes in my life this one wasn’t brought on by myself, but I was engaged. I was engaged when I was 23 and it turns out that the girl I was engaged to was lying to me and cheating on me and blah, blah, blah, blah, blah. And when I finally found out I. I couldn’t eat for three days.
[00:32:53] Right. I was just, I was so devastated this woman that I was so madly in love with it just crushed my heart. And and I kept saying to myself, why did she do this to me? Why did she do this to me? And it took my mom to show me this, but in truth, she didn’t do this to me. She did this because she thought it was the best thing for her.
[00:33:17] Every time she made it a decision, right? Whatever that was. And I was just in a catastrophe of the situation. Now, I suddenly realized in that timeframe, everybody makes every decision in their own best interest. Now people hate it when I say that, but trust me, it is, if it’s not a hundred percent of true it’s 99.9%.
[00:33:42]Andrew: [00:33:42] You peel it back. It has to be.
[00:33:44] Mark: [00:33:44] Right. And. And by the way, go forward a dozen years, I’m in the doctoral program. And I learned about this thing in economics called utility theory, where everybody maximizes their own utility. And I said, Whoa, wait, I invented that
[00:33:58]Andrew: [00:33:58] Geez. Yeah,
[00:33:59]that’s brilliant. Yeah.
[00:34:01] Mark: [00:34:01] I really did. The whole reason I bring that up is because that thought process has driven me my entire life since that point. And when I deal with people, I never expect someone to. They have to do something for me. Right. I always expect that you invited me on here because it’s gonna make your podcast.
[00:34:19] You think it’s gonna make your podcast better? You’re not doing this to give me a benefit. Now, if I can help you out while we’re doing it. Great. That’s awesome. Right. But in truth, I, my attitude always has to be, how can I help you? Because maybe by the way, you’re always thinking of you and I’m always thinking of me.
[00:34:37] So if I can help you, maybe you’re going to help me. Yes. Doesn’t that make sense? So, so I just, it’s an attitude that I’ve had my entire life. Since I was 23 and it has worked amazingly well, especially when you think about pricing,
[00:34:53]Andrew: [00:34:53] Yeah. I know how out of catastrophe comes. S some good positive motion. I really do. I think there’s it’s most constructive way of thinking about it. America is not just that advice. It’s the advice you’ve given us all interview or podcasts. This has been amazing. W I F I feel like my, my brain needs a bit of it at times.
[00:35:15] Decompress afterwards. There’s been so much good stuff out there. I just want to go and apply. But I just encourage our audience. Look, if you do want to go and apply some of the advice Marcus shared with us today, just do it in bite size bits. Don’t go for it. You can go check our website, just focusing on the bits that you want which is a transcript as well.
[00:35:32] If you prefer to read it and then go and execute, but Mark. Awesome stuff really appreciate you investing the time with us today and being a great guest mentor and strength in the numbers.
[00:35:41] Mark: [00:35:41] No worries. It’s always fun. Thanks. And by the way, I did this for me.
[00:35:44] Andrew: [00:35:44] Thanks.
[00:35:46]
