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Foresee with 4C

Updated: Sep 1

Before reading any further, remember you need to collect as much data as possible - information from every deal. To get started, follow the 5-4-3-2-1 approach. Download this bonus cheat sheet to organize your game plan.

PricingIO 5-4-3-2-1 Play Fillable
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Now that you have the data, what do you do with it?

You organize it into four basic categories. The 4Cs divide your data into easily understood sectors to inform your roadmap and foresee your company's potential. See what I did there? The 4Cs are Context, Capture, Customer, and Competitors.


Pricing I/O 4C Framework, Context, capture, customer, and competitors

Context - What is the value around your product/service?

Arrange your data in a way that provides deeper context. You should be able to read your results and tell which features drive the most value. Think about cake. It has sponge, frosting, filling, and decor. But what's selling the cake? You may think it's the frosting but the whole time it was the cream filling. You might also learn that edible play dough (aka fondant) really wasn't doing it for certain audiences within your customer base. What features are used the most? Which features are used together? This information will inform how your packages ought to be defined thus optimizing your use of resources to provide the right value to the right customer.

Collecting this data will help you foresee:

  • What's trending up/down

  • What should be prioritized on the roadmap


Provide the right value to the right customer

Capture - How and where are you winning?

To best answer this question, you must piece your data together in a way that gives details on your paying customers. Do you know how they found you? Imagine a scenario in which your marketing strategy primarily revolves around social media, only to learn that a significant amount of clients found your site through basic search engines. Do you know where your customers are coming from? The needs of Canadian customers could vary significantly than the needs of South American customers. What did they purchase and when are these purchases happening? The sales cycle is important but I'm also talking about the time of year. You may find that you have "seasonal" products/services due to varying value over time. Imagine how different your GTM strategy would be.

On the topic of the sales cycle, what types of deals are your sales teams closing? Deal size, product mix, implementation, and terms are all relevant to your pricing model and should be considered when incentivizing quota targets. This data is still relevant for self-service models. My blog The $1,500 Paperclip talks about how to collect some of this data.

Collecting this data will help you foresee:

  • What will drive more traffic to your website

  • What will help increase your sales margin

Customer - How well do you understand your customers?

Can you tell me what your customers want? No, not what you want them to want but what they actually want. Your data should be able to help you figure this out. Using product usage metrics (e.g. how many emails are sent), number of support tickets and direct feedback from customers will paint a picture of which features are preferred by which segments. Further divide your customer base into value profiles. Bunching them together by what they want from your product/service creates an easy-to-understand visual illustrating how well your customers are being served. This is how you can best proclaim what your customers want.

Collecting this data will help you foresee:

  • What your new offer mixes will be

  • Which customer segments will beta test new features

Competitors - What is your competitive position?

Knowing who your competitors are is only the beginning. Just like you should know how you're winning (e.g. win/loss metrics), you need to know how they're winning, too. Identify differentiators, both positive and negative. Use those differentiators to frame your product/service as having unique value customers can only get from you. Aside from getting intel from your competitors, what other solutions might your customers consider? Believe it or not, handling affairs in-house or simply doing nothing are also your competition. Defending the status quo might be your biggest contender. Some folks simply love their 296-columned spreadsheets. Gather information on how much these alternatives cost (e.g. time, fees, etc.) and use this data to communicate your value to your customers.

Collecting this data will help you foresee:

  • How your industry is evolving

  • How to find new customers and help new customers find you

When you're thinking of the foreseeable future, remember the 4Cs: Context, Capture, Customer, and Competitors. Organizing your data in this way will inform your ability to capture value for your customers. Use the Product Metrics Pyramid to easily determine which metrics are most relevant to your business initiatives. Read more about it in my blog Pyramids Aren't Just for Mummies.

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