My boss gave me a powerful insight: Anyone can win on price. Not everyone can win on product.
To win on product, you have to differentiate which can be extraordinarily hard. A product is not simply the code or physical object that the customer pays for but it is the entire experience of purchasing it and using it.
For something as commoditized as providing cash like at the multinational bank, you have to sell the buyer on your reputation, ease of doing business, and network of additional benefits like other relationships. In essence, you are selling a better experience which commands a premium.
For advertising technology, many people see the different ad stacks as interchangeable. As a result, many people throughout the supply chain have been commoditized and primarily compete based on price. $5 CPM not low enough to win the business? Most people lower the price to win the RFP. Very few companies have resisted the temptation to race to the bottom in their attempt to scoop the deal. Everyone has lost out as the technology deteriorate and the only thing being optimized for is the pricing.
I’m always incredibly proud of my team when we win a deal and aren’t the lowest priced product. There have been a great many times when we’ve been $100,000 or more expensive than our competition – yet, we still win the deal because we offer the best ad tech experience for our media partners. We can offer best practices from our 100+ partners, best ad designs that work for 20,000+ advertisers, and best training from our experience with 3,000+ ad sales reps/ops. We’re offering the best in class service and technology so we charge for it, which customers can and do appreciate.
So if you want to know how good your whole product really is, see if you can be the more expensive option and still win.
