Product Description

How companies turn value-added into real profits
The Dollarization Discipline shows organizations and marketers how to effectively communicate the economic value created by their products and services. Too often, when companies compete using conventional sales and marketing approaches, they force customers to make financial decisions (how much to spend), based on non-financial arguments (product features and benefits). On this playing field, the company that can show true financial advantage in real dollars and cents wins every time. This book offers a step-by-step strategy for doing just that.
Every day, good companies suffer because they create value for customers but aren't able to keep their fair share. This is because most marketers can't fully explain the value customers get from their products, and the argument falls to the lowest common denominator-price. The solution is an approach to sales and marketing that goes beyond articulating features and benefits, but calculates the monetary value a customer receives from a product or service. This enables the seller to price the product as a true reflection of its value-and also let's the seller prove it to the customer!
With real case studies and detailed, step-by-step guidance on effective dollarization, The Dollarization Discipline finally offers a practical, straightforward way for marketers and business leaders to prove the value of their "value-added."
Jeffrey J. Fox (Gilford, New Hampshire) is the founder and President of Fox & Company, Inc., a marketing consulting firm. Fox is also the author of the bestsellers How to Become a CEO, How to Become a Rainmaker, and How to Become a Great Boss. Richard C. Gregory (Farmington, Connecticut) is a Senior Consultant with Fox & Company.

Product Details

• Amazon Sales Rank: #556553 in Books
• Published on: 2004-09-03
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 272 pages

Features

• ISBN13: 9780471659501
• Condition: NEW
• Notes: Brand New from Publisher. No Remainder Mark.
• Click here to view our Condition Guide and Shipping Prices

From the Inside Flap
Jeffrey Fox introduced the concept of Dollarization in his bestselling books How to Become a Rainmaker and How to Become a Marketing Superstar. Now, he and Rick Gregory present this compelling,effective principle in full detail so you can apply it to your business.

The Dollarization Discipline shows organizations how to effectively communicate the economic value created by their products and services. Every day, good companies suffer because they create financial value for customers but aren’t able to keep their fair share. This is because most marketers cannot fully articulate the value customers get from their products, and the argument falls to the lowest common denominator--price. The solution is an approach to sales and marketing that goes beyond articulating features and benefits, but calculates the monetary gain a customer receives in exchange for the price paid. This book offers step-by-step strategies for doing just that.

Dollarization is simple in theory but complicated in practice. Authors Fox and Gregory include helpful charts, how-to steps, and dozens of real-life examples featuring leading companies that illustrate important techniques and help you shape an effective marketing and selling strategy.

This book offers strategies and techniques that will interest CEOs, marketing VPs, field salespeople, and everyone in between. Salespeople will learn how to handle price objections, shorten sales cycles, protect business from competition, get appointments, and more. Marketing professionals will learn to apply Dollarization to new product pricing, market segmentation, even advertising and communications.

Successful companies prosper by discovering how their customers make money and then aligning resources to help those customers make more money. Dollarization is a core discipline that enables firms to put this strategy into practice. With this book, Fox and Gregory include the step-by-step guidance you need to make Dollarization the foundation of your business strategy.

If you believe your company is under-compensated for the real value it delivers to customers, this book will help. Packed with practical advice and real-world wisdom, The Dollarization Discipline presents all the tools and techniques businesses need to turn their value-added into real money.

From the Back Cover
"GE people realize that our job is to help our customers make money. Dollarization thinking helps us do that."
--Damian A. Thomas, General Manager and Corporate Sales Leader
General Electric Company

"THE DOLLARIZATION DISCIPLINE demystifies the often misused term ‘value,’ and shows how to become a thought partner and sell the true worth of your offering. This book will pay for itself many times over."
--Anthony Parinello, Author, Selling to Vito and Getting the Second Appointment

"Strategic marketing begins with an understanding of how a business creates economic value for its customers. This is a core focus for PPG businesses, and THE DOLLARIZATION DISCIPLINE creatively demonstrates how this thinking can be applied to all aspects of sales and marketing."
--Dennis A. Kovalsky, Vice President, Automotive Coatings PPG Industries

"Read this book and do what it says. Your customers, and your employer, will thank you for it."
--John Chickosky, Vice President, FTS Systems

"A must-read for any business looking to improve sales growth, profitability, and customer retention."
--Dean Graham, Managing Director, CapitalSource Inc.

"THE DOLLARIZATION DISCIPLINE presents powerful concepts with practical implementation ideas. Businesses large and small will benefit from putting Dollarization to work."
--John Vander Vort, Director, Private Markets Group
DuPont Capital Management

About the Author
JEFFREY J. FOX is the author of the Wall Street Journal and New York Times bestseller How to Become a CEO. He is also the founder and President of Fox & Company, Inc., a management consulting firm that specializes in marketing strategy development and sales effectiveness.

RICHARD C. GREGORY is a Senior Consultant with Fox & Company. He leads Fox’s Dollarization Consulting and Training practice, which helps clients develop innovative approaches to articulating and quantifying the value they deliver to their customers.

Customer Reviews

Dollarization Is (Common) Sense
As Fox and Gregory clearly demonstrate, it really does take rigorous discipline to "dollarize" one's impact on a business relationship, both directly with a customer and indirectly with that customer's own customers. They have devised a concept, Dollarization, which they define as "the translation of the benefits a product or service delivers to a customer into the dollars-and-cents financial impact to that customer." They assert that the primary objective of a company should be to create value for its owners, and, that the best way to achieve that objective is to create maximum value for each customer. In other words, marketers and sellers tend to talk "value" but few actually understand and then sell their true financial value. Most marketers allow customers to make price the most important factor in a purchase decision. On the contrary, price should be considered as just ONE of the many costs involved in buying a product. For example, the purchase price of a car is obviously one factor to consider. However, fuel economy, maintenance costs, resale value, insurance, etc. should also be taken into full account while making the purchase decision. Those who master the Dollarization Discipline are prepared to explain all this to each prospective buyer.

In Section 1, Fox and Gregory introduce the Dollarization concept (e.g., Why Dollarize?); in Section 2, they identify and explain correlations between Dollarization and selling (e.g. How to shorten the sales cycle?); in Section 3, they do the same for Dollarization and marketing (e.g. How to price new products?); and then in Section 4, they recommend a number of strategies and tactics by which to apply various Dollarization techniques (e.g. constructing the Customer Value File). Once having read these separate but interconnected Sections, the reader is then introduced to "The Dollarization Doctrine: Ten Rules to Successful Dollarization." I presume to recommend that this Appendix (pages 249-251) be read before Section 1 and then re-read before reading each of the following three Sections. Presumably careful readers will highlight or underline key passages for purposes of review later. So I also presume to recommend that each review begin with a re-reading of the Appendix. The Rules which Fox and Gregory offer can -- and should -- guide and inform application of the Dollarization Discipline to any competitive marketplace.

Throughout the narrative, Fox and Gregory include specific advice. For example, when beginning to determine the value created for a single customer or for an entire population of customers, follow these five steps: Identify your direct competition, articulate what differentiates you from the competition, identify all the ways your differentiating features benefit your customer, determine how to quantify those benefits, and then determine how the quantified benefits result in dollars-and-cents savings for the customer. (See Table 20.1 on page 207).

Here is another example of how the Dollarization Discipline can be beneficial. During a recent conversation with one of his most important customers, the CEO of one of my client companies learned that relatively minor adjustments of the delivery schedule would enable that customer to process much more quickly his own customers' orders. (The details are unimportant.) Certain adjustments reduced the sales cycle while accelerating receivables but they also strengthened relationships between the OEM (my client), its customer, and its customer's own customers. One of the most significant and yet least appreciated realities of business is the dollar-and-cents value of time. It is important to quantify the value of reducing a vehicle's fuel consumption, for example. It is also important to quantify the reduction of first-pass yield and cycle time within the process by which that vehicle is produced. Really, applications of the Dollarization Discipline are limited only by one's ability to recognize them.

Warren Buffett once said something to the effect, "Price is what you charge but value is what others think it's worth." Fox and Gregory agree. The single greatest benefit of their Dollarization Discipline is that it allows both seller and buyer to calculate accurately and (yes) verifiably the total value of a given product or service. Granted, making that determination may require substantial time and effort. So what? Use the Dollarization Discipline to calculate the ROI. You may well be very surprised by what you learn...and perhaps regret that you haven't used the Dollarization Discipline until now. Cheer up! Many (most?) of your competitors will never read this book. Just make certain that all of your associates do.

Show me the money
Dollarization "is figuring out what your offering is really worth - in dollars and cents - to your customer." The book discusses the role of dollarization in sales, marketing, and product development.

Rather than saying your product reduces downtime, demonstrate that the product can save $15,000 by reducing 30 minutes of downtime at $500 per minute. If the price is sufficiently less than the dollarized benefit, it's easy for the customer to justify the purchase.

Chapter 20 includes five steps to dollarization:
1. Determine who is your competition.
2. Articulate your differentiating features.
3. State your benefit.
4. Quantify your benefit (convert words to numbers).
5. Dollarize the quantified benefit.

Dollarization is especially suited for business-to-business (B2B) selling because all businesses are motivated by profit. Most examples in the book involve component or maintenance suppliers selling to industrial customers. There is one chapter on selling services.

There is also a chapter on business-to-consumer (B2C) marketing. Customers buy for one of two reasons, to feel good or to solve a problem. Dollarization can only be used with the latter. For example, the cost advantages of a water filter could be demonstrated, compared with the annual cost of bottled water.

I think in some situations it may be less obvious how to apply this principle, or difficult to obtain good data. Nonetheless, I think this is an excellent book.

This book is an "opportunity cost" everyone should incur
Our lives as humans are linear. Despite our best attempts and illusions to multi-task, we can only do one thing at a time and be in one place at a time. The idea that there are other things you would rather be doing, is the core of the financing principle of "opportunity costs," which simply means there are tangible and intangible costs associated with virtually all activities. So, say you spend $100 to pay your heating bill - you'll benefit from keeping the heat on in your home and not having a past due bill go to collections. However, once that $100 is spent you can't use it to secure the benefits of buying food, a birthday gift for your daughter or paying down your credit cards - those missed "opportunities" are opportunity costs. Soundview highly recommends the book titled - "The Dollarization Discipline" - because it shows us how to value the various benefits and costs of nearly every economic decision. While the book focuses on the need for businesses to engage in this practice, it's a skill that any individual can develop as well. From buying a home to buying a piece of manufacturing equipment, understanding the "total cost of ownership" is an opportunity cost that everyone should be willing to incur.