Is It Time to Rethink Your Pricing Strategy Case Solution

In many companies, the prices surprisingly received little attention. Following the work included a study of the prices of 15 small and medium enterprises, the authors conclude that most companies can improve their capabilities and pricing and profitability in time by taking a disciplined approach. The authors identify two key elements of pricing price and the price obtained and five levels of capacity prices. It was noted that the companies studied who received higher prices had leaders who defended the prices skill development. While competition, cost and price sensitivity in a market affect the parameters within which firms set prices, higher prices are almost always based on the skills, the authors argue. Companies are very different in their approach to pricing, but most fall into one of three buckets: prices based on price competition based on cost or pricing based on customer value. Price based on customer value uses data collected by the customer of the product as the main factor to determine the final value of the sale price, and many experts often consider price based on customer value for a better approach to Pricing for existing products. The authors argue that, according to their research companies can improve its pricing to cultivate their understanding of the value they provide to their customers. But don? Practice pricing based on customer value is not easy, the authors warn. They found that the development and implementation? Processability, a program of sophisticated customer value-based pricing is a multiyear project that requires a high degree of executive attention and requires substantial changes in processes and reflection within the company.
Andreas Hinterhuber,
Stephan Liozu
Source: MIT Sloan Management Review
9 pages.
Publication Date: June 1, 2012. Prod #: SMR423-PDF-ENG
Is it time to rethink your pricing strategy? Case Solution

Is It Time to Rethink Your Pricing Strategy Case Solution
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