Ending the War Between Sales and Marketing | Harvard Business Review

In too many companies, Sales and Marketing feud like Capulets and Montagues. Salespeople accuse marketers of being out of touch with what customers really want or setting prices too high. Marketers insist that salespeople focus too myopically on individual customers and short-term sales at the expense of longer-term profits.

Result? Poor coordination between the two teams—which only raises market-entry costs, lengthens sales cycles, and increases cost of sales.

Inserted from <http://harvardbusinessonline.hbsp.harvard.edu/hbsp/hbo/articles/article.jsp?articleID=1014&amp;ml_action=get-article&pageNumber=1&referral=1441&cm_mmc=npv-_-listserv-_-July_2007-_-salesmktg>

Pricing and the Psychology of Consumption | Harvard Business Review

Why should you care if your customers actually use your products? Isn't it enough that they buy them? Not if you want repeat business.

Consider this counterintuitive impact of price on customer loyalty: When your customers are aware of your product's cost, they'll likely use the product—to feel they've gotten their money's worth. And the more they use it, the more likely they'll buy it again.

For example, suppose that Mary and Bill join a health club. Bill pays $600 on enrolling; Mary selects the $50-per-month plan. Who's more likely to renew their membership? Mary. Every month, she's reminded of the cost—so she works out more, to get her money's worth. And members who frequently work out tend to renew.

But to stimulate initial demand, most companies mask their prices, through advance purchases, seasonal memberships, annual subscriptions, etc. Demand-centered pricing has merit—but executives who use it exclusively risk trading long-term customer retention for short-term sales.

Inserted from <http://harvardbusinessonline.hbsp.harvard.edu/hbsp/hbo/articles/article.jsp?articleID=1814&amp;ml_action=get-article&pageNumber=1&referral=1441&cm_mmc=npv-_-listserv-_-July_2007-_-salesmktg>