Pricing is Art: How to measure the impact of proposals on conversions?
Howdy! 👋 One of the fundamental things about offering is that it directly impacts the number of deals you scare. That's a given. But what and how exactly results in this impact? And, more importantly, how to improve this area?
The psychological factors
The 1st thing you have to keep in mind that proposals unlike, for instance, cover letters, are always opened by actual humans. Beings just like you and me. Maybe with some more money to spend and less insight into the offering process.
This means that your offer will be judged based on how easy it is to read, what is the big number (see our previous guide for some tactics here), what additional value/services are stated and, perhaps most importantly, what is the overall feeling of the offer.
A good way would be to show your proposals to a colleague from a different company or even a complete outsider. They won't really get the meaty part and you shouldn't expect detailed comments on individual task estimates. However, they will easily be able to help you improve readability and the ever-intangible "feeling" of your offer. This might sound like voodoo (no dolls were harmed tho), but can really make a difference.
Another thing to do is to check the technical formatting of your document. If you create a simple Excel table, it can be formatted differently between Excel versions, platforms and other applications. Sometimes even big corporate entities use LibreOffice, OpenOffice, WPS or Google Sheets and formatting can be insanely broken. Heck, I've seen way too many problems with slightly different Excel versions on the same platforms.
For other file types, be it from a desktop app or online creator, also assume a zero trust policy. Make sure to check at least a single document in many scenarios: browsers and their versions, devices or screen sizes. You can make the 1st impression just once (duh - otherwise it wouldn't be called that) and it needs to be spotless.
That's not just a standard "everything must be pixel-perfect" boomer talk, either: broken columns or formulas might affect how your prices are displayed!
We underline again and again: there are some things you can't really control or expect, but still have to at least consider the possibility of. Expect the unexpectable, as they say.
First, your prospect might just happen to be in a hurry when they open your proposal. Make sure to include a quick summary/overview.
They might do the unfathomable act of considering other companies than yours - preposterous! To stand out from the rest of the pack you need not only to make proper branding, but also to state basic advantages/info about your company. Anything that will make you seem like the better option if someone provides a similar price to yours.
Also, you shouldn't really expect your customer to be too well-organized. Well, to be honest: expect them not to be at all. You should provide contact information directly on or with the proposal - trust me, your customer will sometimes not find your e-mail or phone number on their own, even if they like the proposal. Further, in fact it is *you* who should initiate the contact at all. That's sales 101: call and ask for feedback.
Measuring & optimizing
If your proposal is simple a file attached to an e-mail, you have limited potential for measuring & optimizing conversion metrics. You can set up e-mail view alerts, so that you get a message when the customer opens your e-mail. You can also set up an auto-responder asking for feedback is a set number of days have passed.
Excel tables should be hosted in Office 365 Online or Google Sheets. This will allow you to set up additional tracking, such as history of edits or alerts on proposal open.
Somewhat obviously, the best in terms of measuring is if you use web technologies. Making your proposal as something that opens in the browser allows you to really dig into insights. Some tools, ours including, allow you to record customer sessions and then play them back. Armed with detailed knowledge if the customer has seen the full proposal (likely not) and where they churned out (likely near the total price), you can react, call them quickly and negotiate to close the deal or answer any questions they might have.
We strive to make this series somewhat interactive. At the end of each article we will ask you questions ir give simple tasks. Today is such a day. Ask yourself this:
- How do you currently send your proposals?
- What data do you have?
- How do you analyze it?
- Do you take actionable insights?
Tip: write down your answers as further reference will be useful!
Stay tuned for the next installment 👋
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