Price Is a Decision, Not a Reaction: What Banking Taught Me About Selling Value
Hilda Maalouf Melki, Oxford-Certified AIExpert Lebanon & Middle East | Chair, AI&Innovation Committee, LCIF District 351—on value discipline in Arab region institutions navigating AI margin pressure
When I contributed to a Forbes expert panel recently on how smart teams sell value instead of discounts, I gave an answer that I have been thinking about for much longer than the panel format allowed me to explain. My answer was this: price is a decision, not a reaction. I would walk away from deals where the discussion stays on price, as those clients do not build long term value. If incentives are linked to the profitability employees generate, they begin to think in terms of long term client value, but only if they are first equipped with clear ROI criteria to guide decisions.
Twenty five years inside Lebanese banking and financial services gave me a very specific understanding of what happens when this principle is not followed. It also gave me an understanding of why it is so difficult to follow, especially in environments where short term revenue pressure is intense and where relationship norms make price negotiation feel like a personal rather than a commercial conversation.
Price competition is not a strategy. It is a signal that the institution has not yet defined its value clearly enough to defend it.
Why do smart institutions still compete on price?
Price competition is rarely a strategic choice. It is almost always a symptom of something else: unclear positioning, insufficient understanding of the value being delivered, or a sales culture that has been incentivized to close transactions rather than build relationships.
In the Lebanese banking context, I watched price competition intensify over years in ways that were structurally damaging even when they looked commercially rational in any individual case. The institution that wins a corporate client by offering slightly better terms than a competitor has not won a relationship. It has won a transaction, and it has done so in a way that signals to the client that price is the primary variable the institution is willing to compete on. That signal is very hard to unsend.
This same dynamic plays out across the Arab region. In markets across Lebanon, the Gulf, Egypt, and Jordan, where business culture places high value on relationships, institutions often confuse relationship loyalty with price loyalty. The two are not the same. A client who stays because of the relationship is a client worth building. A client who stays only because of price terms is a client who will leave when someone offers slightly better ones.
AI is changing this dynamic in ways that are worth understanding. As I wrote in an earlier piece this month, AI is lowering the cost of capability across the market. That means competitive advantage can no longer rest primarily on the ability to do things competitors cannot afford to do. It has to rest on something more durable, such as the quality of the relationship, the depth of the understanding, and the clarity of the value proposition.
What does linking incentives to profitability actually change?
The second part of my Forbes panel answer is the part I find most operationally important, and it is the part that gets the least attention in discussions about sales culture.
When salespeople and relationship managers are incentivized on revenue closed or deals won, they optimize for closure. When they are incentivized on the profitability of the clients they bring in, over a meaningful time horizon, they optimize for quality. These are different behaviors, and they produce different client portfolios.
The catch is that incentive redesign only works if the people being incentivized have the tools and the criteria to make quality judgments at the point of decision. If you tell a relationship manager to focus on long term client value but do not give them a clear framework for assessing what that means in practice, the incentive change produces confusion rather than behavior change.
This is where ROI criteria come in. Not as a bureaucratic filter, but as a decision support tool that gives relationship managers confidence to say no to opportunities that do not meet the standard, even when those opportunities are presented by clients they have a personal relationship with. In the Arab region’s business culture, where relationship and face saving dynamics are real and significant, this kind of clarity is particularly valuable. It gives the relationship manager a principled, impersonal basis for a difficult conversation, rather than requiring them to make that conversation feel like a personal rejection.
What has AI added to this question?
AI has made it possible to build ROI assessment criteria that are dynamic rather than static. Rather than applying a fixed scorecard to every opportunity, institutions across Lebanon and the Gulf can now use behavioral and transactional data to develop client specific assessments of likely long term profitability, attrition risk, and cross sell potential that would have required significant manual analysis to produce even five years ago.
This does not change the underlying principle that price is a decision, not a reaction. It changes the quality of information available when that decision is being made, and it changes the speed at which that information can be generated.
For institutions across the Arab region that are building or rebuilding their commercial models in a constrained environment, this combination of clear value positioning, profitability linked incentives, and AI supported decision criteria is one of the more concrete and implementable ways to move away from price competition toward something more durable.
If this connects to challenges your institution is working through, I discuss related questions in more depth at hildamaaloufmelki.com, and in my book AI Simplified at hildamaaloufmelki.com/signature-book.
About the Author
Hilda Maalouf Melki is an Oxford-Certified AI Expert, an Official Member of the Forbes Business Development Council, Chair of the AI & Innovation Committee at Lions Clubs International – District 351 (Lebanon, Jordan & Palestine), and the author of AI Simplified (الذكاء الاصطناعي ببساطة).
With more than 25 years of experience spanning banking, digital transformation, brand strategy, and artificial intelligence, she advises executives and institutions on AI strategy, AI governance, responsible AI adoption, and institutional transformation. Through her writing, speaking, and advisory work, she helps leaders move beyond AI hype to practical, strategic implementation that creates measurable business value.
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Website: hildamaaloufmelki.com