What price a relationship?

  • Business life is rarely without its ups and downs and there are occasions when we all have to call in the odd favour.

    Such was the case this week, when an issue arose with an advert for one of our clients. With the fault laying fairly and squarely at our door, our first response, after apologising to the client, was to arrange to run the advert again at our expense.

    Having worked with the publication in question for many years, and purchased a reasonable amount of advertising from it, we asked for some leeway on the price. The response was an uncompromising 'No. This is your problem, not ours'.

    This might seem perfectly reasonable. After all, why should the publication compromise its margins to help us out, particularly in these straitened times?

    The answer lies in the pricing strategy.

    The incident brought home to us that what we had seen as a relationship, the publication prefers to treat as a series of unrelated transactions, each to be exploited for the maximum possible price. No value is placed on our future spending power: the priority is to maximise revenue now.

    This is a legitimate pricing strategy, but not without its consequences.

    The discovery forces us to re-appraise the way that we will do business with the publication in future. The loyalty that we have felt towards it now looks misplaced and leaves us feeling a little foolish. We must now start to treat each transaction as the publication does and judge it primarily on price. We are also motivated to look more closely at the competitor publications and get to know the people behind them a little better. These are all the characteristics of a transactional relationship.

    In contrast, a small concession would have deepened our sense of loyalty, encouraged our advocacy and even left us feeling a little in the publication's debt.

    The publication has great confidence in its brand and, if it is right in its assessment that it is the No1 brand in its niche, it can indeed dictate terms in this way. For most businesses, however, applying transactional pricing in a relationship situation is a dangerous and short-termist approach. The pursuit of margins, in the absence of, or at the expense of customer loyalty, ultimately shifts economic power to the customer. Customers quickly leave when a better offer arises elsewhere.

    Sour grapes? We hope not. We accept our misjudgment of our worth and respect the publications right to act as it pleases. We are happy to work under the new rules.

Related articles

  • Read More

    SharpSpring launches visual workflow builder to enhance lead generation and sales

    SharpSpring recently announced the launch of their Visual Workflow builder. The new feature intends to make the process for creating workflows easier and brings it in line with the likes of Pardot...

  • Read More

    Why can’t we make faster business decisions?

    Malcolm Gladwell, in his book Blink, argues that the lengthy procrastination that often takes place in decision-making is ‘post self-justification’, because we actually make up our minds pretty...

  • Read More

    Marketing activity so bad it’s quite literally criminal

    A news article came out through the Bangkok Post (we found it through The Verge) last week about the arrest of three Chinese nationals. The trio had been paid over £10,000 a month to run a...

  • Read More

    Jason Dilworth joins The Marketing Eye to develop technical capability

    Financial services marketing agency, The Marketing Eye, has appointed Jason Dilworth to the new role of Technical Director in a move designed to expand and develop the company’s data-driven...

  • Read More

    A third of B2B marketers are tracking sales through social

    For an industry whose origins and continuing existence rely heavily on the accurate analysis of statistics, the insurance sector would do well to note the seismic shift taking place in modern...

  • Read More

    Repeat, Repeat, Repeat – 4 reasons to keep contacting the same prospect list

    Asking someone to buy your product or sign up to your service after only one mail-shot or email is unrealistic. We can’t expect that one email, no matter how carefully crafted, will be enough to...

  • Read More

    Promoting video content on social media

    So, your business has splashed out on a big, beautiful high quality piece of video content, you are going to want to stretch it as far as it will go, right? Then don’t do what everyone else does...

  • Read More

    Four Facebook ad campaigns you should be running to attract and retain investors

    With around one-fifth of the world’s population on Facebook, you would think generating brand awareness and leads from it would be a piece of cake. The reality is less straight forward. With a...

  • Read More

    6 quick wins when you first sign up to marketing automation

    Marketing automation systems are powerful, intelligent and the bedrock of many businesses' marketing strategies, but getting to learn and understand them takes time and dedication. Not becoming...

  • Read More

    7 characteristics of social media implementation in B2B marketing

    If you look for evidence of the potential benefits to B2B organisations of social media, you will see both lead generation, as well as brand reinforcement are being addressed to great advantage....

Take the first step

To find out more about how we can help you grow faster, please get in touch. We'd like to hear from you.  Or try our instant marketing healthcheck, it's free!

Quick Contact

Quick contact


Contact us

T 01825 765617

E hello@themarketingeye.com

Our offices

Full details of our offices in London and Uckfield more

Request a call