- Blog post
The Selling Essentials Minute, Ep. 3: David Ogilvy on Pricing and Value
Welcome to the newest installment of the Selling Essentials Minute.
For those who missed the previous episodes, The Selling Essentials Minute is a series of videos that offers one powerful sales tip in about sixty seconds. It’s a single, focused idea that salespeople can use to help them master one small concept. You can use the Minute to kick off a sales meeting, push an idea out to your team, start a discussion or reinforce your training.
On today’s episode, advertising legend David Ogilvy offers some advice on pricing that every salesperson should take to heart:
Back when ad agencies made most of their money from a standard 15% commision on media cost. Consumers not a moron, she’s your wife. And legend David Ogilvy wrote an open letter to prospective clients. “Insist on paying 16% to your agency” he wrote, the extra 1% won’t kill you and it will double the agency’s normal profit and you will get better service.
Would you tell your prospects to pay more just so your company could double it’s profits? That would never work, what if, well it worked for Dave, he retired here and although he died in 1999 Ogilvy & Mather is still billing strong around 10 billion dollars at last count. 1% of that works out to a whole lot of that better service.
So, what’s the point? Ogilvy knew that clients weren’t looking for low price ads, they were looking for high value ads. And that in the long run, a fair price means you can deliver more value.
Of course customers will test you the last discounts happily take them if you have and then wonder why they’re not getting the value they expected. So, do right by them and yourself insist on the price you deserve. That’s what Dave would do.
“I’ve no use for toadies or hacks I see gentlemen with brain”
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