Driving behavior through customer incentives

Incentives are part of everyday life, steering individuals to desired behaviors. We reward children for eating vegetables and sales people for achieving quota. How we develop customer incentives is no different.

Going beyond willingness to pay

Any experienced pricer will tell you to establish prices based on “willingness to pay.”  However, in B2B industries, the answer is more nuanced: one “price” is more complicated than a simple discount. Price often comprises various on and off-invoice elements including rebates, bonuses, payment discounts, trade, and so on. Second, many of these elements are often “not guaranteed,” requiring agreed conditions to be met. So, in addition to pricing based on willingness to pay, we price by “willingness to perform.”   

What is pay for performance?

Understanding influence

To implement a pay-for-performance system, you need to deeply…