My VP Sales thinks that increasing pricing is not possible and any increase will lessen her ability to hit her number. How should we think about changing pricing?

In my experience, most Sales teams think the pricing is too high, and often they have the data to back it up with win/loss calls suggesting price as the reason a customer did not buy a solution. But sometimes these may be customers that fall outside your ICP. At other times, they may just need more ROI justification to make the case for your product internally. Often this is excacerbated by the quota they carry and a short-term focus on closing deals in the near-term. 

On the other hand, many executives fail to appreciate how prospects really value their solution. They may think they have more leverage on price since they have a more capable solution - while the prospects may not care for many of the additional capabilities. Ad-hoc pricing changes are often meant with sales resistance, unless clearly articulated and justified.

Therefore to attempt to change pricing is really about going back to listen to customers and prospects. 

1. What do they feel about your products differentiation from competition?
2. How well do they think your current packaging/offering meet their needs?
3. What is their perception on the ROI of using your product?

Once you understand how customers value your offerings? You can devise a plan to increase prices by increasing value or the perception of value?

Depending on the root issue. This could be done via:

1. Adding value added professional services offerings

2. Breaking down a large software package into smaller chunks that prospects find easier to attribute value to - sometimes the parts can be valued more than the original sum.

3. Creating ROI analysis across your customer base and enabling your sales team with this analysis

4. If you feel you are simply priced lower, you can just pilot a price increase in one sales region or customer segment and track the impact of the change. In this case, you could increase discounting thresholds to lower Sales team resistence. 

When your VP of Sales understands that all your work is centered around helping her justify value, so that she can make more money - any resistance will fade away.

Start by articulating internally why you want to increase price - do you have new functionality that is delivering additional value, are you bleeding margins, have your competitors changed their pricing - what’s driving the change? Changing prices needs to be aligned with your pricing power and your buyer’s willingness to pay. What do you offer and how much do they put against the value they think they can get from it. It’s also important to make sure you’re enabling your sales team about the business value narrative of your company/product, giving sellers confidence in how they talk about pricing to drive less discounting and shorten cycles.

Without a ton of context on how your company works and what the decision making process looks like, I’d say my biggest advice on what to do here is to lay out the full business case and options. When I hear a big flag from a VP of Sales that there’s an issue, it’s important to pause. It doesn’t mean you’ll always do exactly what sales needs, but sales morale is a hard thing to keep and if you need these folks to succeed. I’d map out the reasons for the price increase, the data and reasons it makes sense, the risks it has, and how other teams will be impacted to see the full picture. I’d bring that full discussion to a leadership room with all the invested VPs and above to help you all as a group determine what to do. It’ll rarely work to hear a concern like this from a VP of Sales and just plow ahead.

I would approach this similarly to how I approach any re-pricing exercise. It is a best practice to evaluate your prices at least once a year for most products. Your VP of Sales should understand that things change. If you can prove some of those changes, either internal or external, then you'll have a stronger case. External conditions are things like inflation, global/local economic changes, new competitive entrants, market consolidation or fragmentation, etc,
and would affect all of your competitors too thereby lessening the impact on her concerns over meeting her number. Internal conditions, which include new features, features you are missing, new markets or locations, awards or recognition, ROI trends etc, may be less applicable to competitors she will come up against but are still valid reasons for price increases or decreases. In general, it's good to at least review all of the external and internal factors every year even if you decide not to make any changes. Once she sees all the factors, she may change her mind.