This American tourist saw Picasso having a coffee at a Parisian cafe. She mustered strength, walked up to Picasso and said, in her high school French:
"Mr. Picasso, what a pleasure to meet. Can I please ask you to make a portrait of me? I will pay anything you want!"
Picasso took up his notepad, quickly drew a portrait and handed the drawing to the woman.
"That will be 5000 Francs, Madam." He said.
"WHAT! It only took a couple of minutes."
"No, Madam. It took a lifetime."
So what does Picasso teach us in this short story? Well, what he teaches us is that we deliver a unique value to our clients. It was not the time it took to make that drawing that matters; it is his experience, his fame, the personal interaction, that, in fact, the drawing was a "Picasso" that all together constitute the value he delivered to the client. But it also teaches us how the client had price expectations different than Picasso; she could have gone to any of the street vendors drawing portraits for only a few Francs and maybe her expectation was that Picasso would do a portrait for twice or triple that price. Finally, it tells us that if you do not communicate that unique value, the value just you can provide to just your customers in a convincing way, the price of your product or service will generate sales friction.
From this little story, there are only two outcomes:
- The client could not accept Picasso's price and walk away, and he would have torn up and tossed away the drawing.
- Or, she would reluctantly pay the 5000 Francs. Becoming a grumpy customer.
The alternative would have been for Picasso to say:
"For a real original Picasso drawing, that will be worth 20,000 Francs in 10 years, I give this to you for only 5,000!"
A delivery of the value proposition to justify the price and the value over and above the time it took to make the drawing. The woman would be happy to pay 5,000 Francs now. Picasso gets his 5,000 Francs, and the woman becomes a happy, proud customer.