Who Should Own Product Pricing with Ray Ranga

Ray Ranga is currently the VP of Product Management at Momentive AI. Before working in Momentive, Ray was the Senior Director of Product Management at Splunk. Ray is an instructor at UC Berkeley and he also conducts a pricing class at Stanford. In this episode, Ray discusses the power behind involving the people who know the product’s value when making pricing decisions as he specifically points out the benefits of having pricing teams connect with people from the product management department.   Why you have to check out today’s podcast: Discover which team should own pricing in a company in relation to the value the product has; Find out how to effectively package products in a way that resonates best with what your customers want; and Understand why pricing and product management people should be one when making pricing decisions towards their product   “Understand your customers to a deep, deep level. See what gets your customer ticking, and then I'm sure everything else follows.” – Ray Ranga   Topics Covered: 01:31 – How Ray got into pricing: From being an engineer then shifting to product management 02:31 – Answering the question “who should own pricing?” 04:50 – The role of product management 05:37 – What Ray teaches in his pricing and product management/marketing class 07:43 – The difference between behavioral economics and pricing for value 10:17 – How to package products, explained in the simplest possible manner 15:44 – Why you should go for market segments first, not across market segments 18:13 – The similarities of Mark and Ray’s practices when figuring out market segments 21:42 – Talking about the presence of confidence problem with regards to charging a high price 25:01 – Ray’s piece of pricing advice for today’s listeners   Key Takeaways: “Pricing and product management need to go hand in hand.” – Ray Ranga “Product marketing is good on pricing. They understand our customers well. They understand the persona and the segment we sell into typically. I do have a bias towards who should not own pricing. I feel like finance or sales should not own pricing, for some obvious reasons. But other than that, I think product management and product marketing are fine owning pricing.” – Ray Ranga “Pricing is a number at the end of it, but it's so much more. It's so much more about operationalizing pricing, and that's where customer experience comes into play. You need the right ways to consume the price of the product that you just priced.” – Ray Ranga “Analysis and research and competitive positioning is very useful. And I think, sometimes, you should take that seriously when you have the data points in front of you.” – Ray Ranga “Enablement is very key to pricing, especially in zero to one products. You want to be with the sales team in those initial calls until they feel comfortable that they can tackle these questions about pricing in the early days.” – Ray Ranga   People / Resources Mentioned: Momentive AI:https://www.momentive.ai Splunk:https://www.splunk.com/ SurveyMonkey:https://www.surveymonkey.com/mp/enterprise/?ut_source2=en Predictably Irrational:https://danariely.com/books/predictably-irrational/ LinkedIn:https://www.linkedin.com/   Connect with Ray Ranga: LinkedIn:https://www.linkedin.com/in/rayranga/ Email: [email protected]   Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: [email protected]