Before a product can be priced, it is very vital to understand what the customer is willing to pay for the product or service. Now, this is very easily said than done. When it comes to fmcg companies, the company is selling soaps, detergents, shampoos, chocolates, etc. They conduct various kinds of surveys through which they try to determine the customer's mindset in terms of what the customer desires and what is the amount of price the customer is willing to pay. However, this is not possible when we are trying to sell projects to large companies or small companies. When it comes to selling projects, it is possibly much more easier to find out why the customer wants to buy the system or have the project conducted for them.

So, it is a normal practice that all the way Marketing agents, when they start discussion with the customer regarding a project from the very initial stage they try to figure out what what is the budget the customer has for this particular project. Normally, this is a very difficult exercise but however through public put through personal relations in its internal marketing agents normally are able to determine this kind of information. Another thing which is very vital to be done is to find out why what are the driving forces behind the customer wanting to conduct this project. Normally we talk to the CXO level people to find out what are the main drivers is the main driver to cut cost or increase savings or is the main driver to increase revenues or is the main driver to provide a customer delight to their customers. So, the main driver has to be determined Now based on the driver, it is possible to determine what the customer may be willing to pay for the solution what they are seeking through the project.

In any of the cases it is very vital that we get sufficient customer insights. Before we can start pricing for the product, it is possible always possible to distinguish customers who are price seekers and who are value seekers. However, this information is not so easy to find out at the very beginning stages of attempting a project over the course of duration of relations between the customer and the vendor. The vendor normally finds out whether the customer is a price seeker or a value seeker. However, for new vendors going to a new customer, this information is not very easy to find out. Now price seekers are the customers who will want always the lowest price From the vendor whereas, value seekers are vendors who value quality who value research and development and are ready to pay for aspects of this nature.

Now, one of the important things to be done for customers is that we should segment the customers between who our price seekers and our balance equals this is very important. Now, many companies, they carry out multiple brands, they will normally have one set of brands, which are focused towards price sequence and they will have one set of brands which are focused towards value seekers. Now, there will be qualitative difference between the productivity to price seekers and productivity to value seekers. However, having multiple brands may not be possible for small firms. So, we take a different approach in our firm when we make products, we try to build products with as many features as possible. However, we always have one module in our in each of the products where we tag each of the features, which is available in our product.

Now, based on whether the customer is a price seeker or a value seeker, we turn on or turn off features which will be given to the customer. So the price seekers, they do not get the good features because of the price they're ready to pay, whereas the value seekers get more features, which the customers way as they're ready to pay for it. Now, you you can find this in most of the software vendors like for example, if you buy a word processor which is given at a low cost, it will normally have lot of restrictions regarding what can be done with it. And when you pay the full price of the same software, you will get all the features what the software has to offer to you. So, this is one of the mechanism. So, the essential thing is, we should always segment the customers based on whether they are price seekers or value seekers.

And then we must have different offerings of the same product, the one or one set of offerings which we can give for the price takers, advantage of offerings which we can give to the product value seekers. Now, we discussed that it is not so easy to categorize the customer as a price seeker or a value seeker, especially when the relationship with the customer is very new. This becomes very apparent when the relationship becomes older. But in the early stage of the relationship with the customer, it is very difficult to find out whether he's a price seeker or a value seeker. Now, we are talking in terms of organizations we're not talking in terms of fmcg products or things Like that. Now, trying to figure out whether the customer is a price seeker or value seeker is extremely difficult or impossible through the publicly available documents about the customer.

So, investments are required we I state one of the experiences what we had in how we achieve this. We were bidding for a project in Thailand. The customer was absolutely new to us, we were talking to them for the first time. And as it is, we did not have any customer in Thailand till that point of time. So we did not even know the company's culture country's culture in terms of price CEQA versus value seeker aspect. So what we did was, we made a partnership with a company who was our system integrator for this customer who with whom we were trying to set up a relationship and sell a product to be the intermediary between Asked and the customer.

So, the system integrator would make the dealings with the customer and we would supply the product through the system integrator to the customer. Now, the system integrator we chose had had more than 10 years of relationship with this company to with whom we were trying to sell the to whom we were trying to sell the product. So, the system integrator knew very much details about what this customer was all about. In fact, the system integrator also knew who were the competitors for that particular build and they had experience of what that competitor was like and what was the likely price etc. They went to court, the system integrator had inside connections through which we could get a lot of information about the deal and about the company as such. So, we invested some amount of money if we'd have gone directly we would have got all the revenue from this project for our company.

However, involving the system integrator may meant that we will To have to give a share of the total revenue to the system integrator for mediating between us and that company. So, these are this is one of the techniques which we adopted for finding out about some insights about the customer. So, different companies that have different techniques, this is one of the ones which we have discussed here. Okay. So, now we have discussed customer insights. Next up let us discuss about price economics