The Price is Not Just About Paying the Rent

petshopboys_maltesen2It’s often said that everyone has a price, and when it comes to transaction-based deals, of course, price is all-important.

I thought about this as I listened to another track from the Pet Shop Boys—Rent—while airborne recently. Last time in this space, in More to Partnership than Making Money, I riffed on another of their songs, Opportunities, and concluded there’s much more to successful, long-term partnerships than brains, looks and brawn.

And with Rent, written in 1984, there is much more to relationships than money. Rent is a great follow-on to Opportunities because it deals with a relationship grounded in a very basic transaction—perhaps the most basic in certain circles—with this refrain: “I love you, oh, you pay my rent.”

If you watch the short music video, the subject may be about a rent-boy, but more likely it’s about a kept woman, or mistress, who trades her “love” for things, food and … rent.

The relationship described in the video is a good snapshot of the thinking behind transaction-based arrangements that are based purely on money and services. Those are not really sustainable, long-term relationships because there’s no motivation to do more or add value. What happens when the money runs out, or a better price is offered? The parties move on. From a business perspective in this case, the supplier is like the girlfriend—simply showing up because the buyer pays the rent.

In the Vested model, the relationship is not based on price per se, or a strict one-for-one trade, or simply showing up for the money; it’s based on a flexible pricing model, or framework, designed collaboratively by the parties so that they can forge a long-term partnership that instills trust and commitment while creating, sharing and expanding value.

And a value-based relationship is much more valuable than simply exchanging money for rent…and love.

Image: Pet Shop Boys Live in Copenhagen by Maltesen via Flickr CC

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