How to price your products to maximize demand and profit and create a strong business strategy using the Predictive Innovation Method. Using Flying Cars as a case study to analyze total cost and customer value.

1. Is Your Product
Too Expensive?
What does too expensive mean?
By Mark Proffitt
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2. Too Expensive
●
Absolute
●
Relative
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3. Customers' Values
●
Customers buy products to satisfy desires
$
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4. Customers' Values
●
Customers buy products to satisfy desires
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5. Customers' Values
●
Desire A > Desire B > Desire C
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6. Customers' Values
●
Cost > Value = Too Expensive
$
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7. Customers' Values
●
Cost > Value = Too Expensive
●
Absolute Too Expensive
$
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8. Outcomes
●
Objective criteria
●
Observe
●
Measure
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9. Outcomes
Maximum
Minimum
OK
OK OK
OK
A B C D
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10. Outcomes
Maximum
FAIL
Minimum
Too
High OK
OK
Too
Low
A B C D
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11. Absolute Too Expensive
Cost > Value Outcomes ≠ Criteria
FAIL
$
Maximum
Minimum
Too
OK High OK
Too
Low
A B C D
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12. Relative Too Expensive
Product A Product B
$ 100 $70
Minimum Minimum
OK OK OK OK OK OK OK OK
A B C D A B C D
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13. Relative Too Expensive
Product A Product B
$ 100 $70
Minimum Minimum
OK OK OK OK OK OK OK OK
A B C D A B C D
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14. Cost is more than money
Minimum
OK OK OK OK
OK
OK OK OK
A B C D A B C D
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15. Purpose Determines Criteria
Minimum
OK OK OK OK
Too
Too Too Too
Low
Low Low Low
A B C D A B C D
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16. Purpose Determines Criteria
Maximum
Too
High Too Too Too
High High High
OK
OK OK
OK
A B C D A B C D
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17. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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18. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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19. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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20. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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21. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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22. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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23. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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24. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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25. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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26. Outcome for Travel
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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27. Leave from desired place
●
Ideal outcome: leave from anyplace
●
Airplanes: only from airports
●
Flying cars:
●
Drive to airport, limited in most areas -
●
VTOL has other limits -
●
Drive like normal car +
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28. Leave at desired time
●
Ideal outcome: anytime, no waiting
●
Commercial airline: limited departures
●
Private airplanes: More times but more cost -
●
Flying car: same are private airplane
●
Can't fly in all weather -
●
Must refuel before leaving -
●
Option to drive not as flexible as ground car +
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29. Leave with desired objects
●
Ideal outcome: take anything
●
Flying car: capacity is limited
●
Size -
●
Weight -
●
Must be inside -
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30. Leave in desired condition
●
Ideal outcome: any condition
●
Flying car:
●
Must be in good condition to fly -
●
Can't easily stop mid trip -
●
Drive same as ground based car
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31. Arrive at desired place
●
Ideal outcome: go anywhere
●
Flying car:
●
Go over obstacles +
●
Limited landing +
●
Parking might be limited -
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32. Arrive at desired time
●
Ideal outcome: arrive instantly
●
Flying car
●
Faster for long trips +
●
Avoids traffic +
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33. Arrive with desired objects
●
Ideal outcome: Everything you want at
destination
●
Flying car:
●
Cargo is limited --
●
Good for perishable items +
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34. Arrive in desired condition
●
Ideal outcome: Always arrive in as good or
better condition than left
●
Flying car:
●
Faster trip, less tiring +
●
Any accident is likely deadly --
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35. Flying Car vs. Ground Car
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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36. Flying Car vs. Private Plane
Leave with Leave in
Leave from Leave at
desired desired
desired place desired time
objects condition
Arrive with Arrive in
Arrive at Arrive at
desired desired
desired place desired time
objects condition
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37. Extra Outcomes
Speed Access Enjoyment
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38. Applications of Extra Outcomes
●
Speed
●
Medical emergency
– Leave from and Arrive at any location required
●
High value cargo or passenger
●
Relative Too Expensive
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39. Applications of Extra Outcomes
●
Access
●
Locations not easily available by land
– Over water, valley, wilderness, poor or blocked roads
– Surveying and site seeing
– Construction
●
Security, limit access
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40. Applications of Extra Outcomes
●
Enjoyment
●
Fun of flying
●
Prestige
●
Highly subjective
●
No direct financial value
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41. Outcome Analysis
●
Target markets
●
Calculate ideal price
●
Increase value and profit margins
●
Assess market risk
●
Create business strategy
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42. www.MarkProffitt.com