Price increases can be difficult to implement but there are tangible steps you can take to ensure a smooth transition and get customers on-board.Read More
The newspaper and information publishing industry are finding it more and more difficult to maintain profitable in such an aggressive market. Experiencing intense pressure from advertisers and consumers, industry leaders are looking for new ways to capture value and maintain margins. One strategy that we’ve seen work is module advertising.
The pricing discipline has been growing rapidly as companies realize that investing in pricing can have long-term payoffs. But investing in pricing research can be a costly endeavour. We discuss the best ways to make sure that your pricing research returns positive ROI.
The strategy companies choose to price their products and services can be a key factor in their success or failure. How the IoT influences pricing strategy.
Managing price is increasingly difficult and complex for Medical Technology companies. Internal development of the pricing function, organization and skills is a must. Read our thoughts on the state of pricing in the medical device industry…
Quantified customer research is key to establishing the optimal price point and enables companies to capture more revenue. Companies leading the way in Pricing Strategy regularly conduct extensive Pricing Research. This is especially important in the Fashion industry, where customers’ perceived value can far exceed production costs.
Many organizations begin their annual pricing process in July in order to be ready to start invoicing Jan 1st. By developing a pricing strategy as part of your annual planning process you can achieve profits well in excess of just taking a uniform increase.
In recent years we have seen the sporting world borrow pricing strategies from other industries, and vice versa. In such a diverse business environment what is the optimal pricing strategy for events, and what can other sectors learn from developments in ticket pricing?
Not long ago I thought it was time to “get personal about pricing,” and wrote World Class Pricing: The Journey. More than 20 years of experience and 700 projects went into developing a roadmap to pricing improvements that now all our clients use.
In pricing we talk a lot about developing an ‘outside-in’ perspective; the type of perspective that helps you understand what customers are willing to pay for. Pricing research provides critical insight into your customers but watch out for common pricing pitfalls.
President Paul Hunt, continues his discussion of customers, competition, costs, capacity/cycle, explaining how the socialization of the 4Cs is essential to achieving buy-in to your pricing strategy. Paul also talks about common pricing challenges and mistakes, and explains how your organization can avoid them.
Good negotiation is a commendable talent, but businesses need the skills to deal with good negotiators. Protecting your profitability from good negotiators requires ardent compliance to pricing policies, a flexible pricing infrastructure and the ability to say “no”.
Far from being the first to take action, a true price leader is able to consistently execute pricing actions that result in the desired effect. Much like in a game of chess, a pricing leader devotes the time and resources to understanding the motivations and aspirations of its competitors and to building the skills necessary to think several pricing moves into the future.
Singapore: July 18, 2012 – Pricing Solutions Ltd., a leading consulting firm specializing in pricing strategy and well known for its World Class Pricing ™ Methodology and Price + Value Insights™, is delighted to announce the opening of its Asia Pacific Headquarters, located in Singapore.
On May 4th the Canadian government officially stopped production of the penny, and will now be using “Swedish Rounding”. There may be significant implications for pricing, after all a 1% improvement in price leads to a 12.5% improvement in corporate profitability for the average company.
Pricing Solutions is proud to sponsor the Pricing Management course under professor Vinay Kanetkar at Guelph University. In the past several years we have awarded a $500 prize to the best term paper. Congratulations to our 2011 winners!
Pricing low to gain volume is the oldest move in the pricing playbook; the laws of economics say that as you lower price, volume will go up. Therefore many companies that want to dominate a market, or are in a rush to grow in a new market, will use low prices to achieve their goals (e.g. Walmart, Dell, Private Label).
If a consumer is shopping for an exclusive brand and likes the idea of buying smart, then many would conclude they can save some money by buying online from a country that sells it cheaper. However, the truth is that they probably won’t succeed; at least not online.
I was presenting at a conference recently and mentioned the Professional Pricing Society. A gentleman in the audience scoffed and could not believe there was such a thing! Well, believe it or not, there actually is a Professional Pricing Society and it has been in existence for quite some time.
Just when things were looking bleak for Netflix they caught a break as Bank of America came along with their debit card pricing fee. Bank of America has taken such a beating for that decision that if there was such a thing as a Pricing Piñata it would have their logo emblazoned all over it.
Pricing strategy is a hot topic these days. Over the past 20 years, we have helped many companies develop, refine or transform their pricing strategy, but today we get requests for help more frequently than ever before. So why the surge of interest now?
Finance Minister Jim Flaherty recently announced his desire to commission a Senate Committee into Canadian pricing. There have likely been a number of triggers for his reaction, but J Crew, a specialty apparel retailer, entering Canada at a significant price premium to its US pricing and subsequent reversal I am sure was part of the cause.
It’s no wonder that Fortune 500 Companies are kicking off pricing initiatives at such a tremendous pace. The fruits of their efforts are continuing to make headlines. In last Friday’s Bloomberg’s Business Week there was a prominent article about the gains Goodyear has made by managing mix.
An increasing number of clients have been evaluating the Groupon model and trying to assess whether it is right for their business. This is a difficult question that often leaves high-level executives perplexed. In order to make an informed decision, it is essential that you approach this decision in a process-oriented manner.
For the average business, a mere 1% increase in price leads to a whopping 12.5% improvement in profitability. That’s the single most powerful lever a company has for boosting the bottom line. The pricing waterfall, a tool for identifying hidden costs and expenses, is one of the most effective ways of capturing that 1% – or more!
Netflix has been getting a lot of attention lately for its new pricing strategy. If you have kept an eye on the matter you will have noticed that there is an interesting paradox. Consumers hate it but analysts love it. They may lose as many as 2.5 million customers but profitability should go up.
Airlines are leaders at sophisticated pricing systems, developing micro segmentation and capturing profits. Despite being leaders airlines still have the opportunity to capture more profit with simple tweaks to their pricing model. Read more on our thoughts…
A consultant at Pricing Solutions recently presented some learnings he took away from an IBM conference on the topic of analytics. An important topic was the emerging frontier of using real time data to make real time decisions. From a pricing perspective, how could this level of data analytics move companies forward in their ability to be good value based pricers?
If your segmentation isn’t leading you into a discussion about behaviour, price structure, innovation and offer design, you probably have a large untapped opportunity. Read how segmentation can be the backbone of your pricing strategy.
Kent had been excited about launching his company’s newest engine into the aviation industry. It offered major benefits, such as better mileage, greater durability and reduced maintenance costs. Unfortunately, sales were anemic, and Kent was forced to discount heavily to hit his target numbers.
Why was your airplane overbooked? How come the price for a hotel room changes from day to day and how do car-rental companies know how many cars to have at any given airport? These questions and more can be answered by looking at the management science tools used by some businesses to manage revenue, costs and capacity utilization.
With the recent launch of the iPad 2, much has been made about Apple’s decision to launch it at the same list price as the original iPad. Unfortunately most of what I have read has skirted what I see as the key pricing questions at the centre of this debate.
As commodity costs skyrocket, there has never been a greater need for companies to implement strategic price increases. Unfortunately, many organizations are afflicted with Price Increase Rigor Mortis (PIRM), an insidious disease that paralyzes their ability to raise prices and ravages their bottom line.
Why on earth did they buy that there? Sometimes, it seems customers act irrationally when it comes to their buying behaviours. But that is never the case. Customers always behave in ways they perceive are in their own interest. And yet, the rationale behind these decisions is often puzzling.
Your boss gives you a seemingly impossible task: Increase profits by 12.5%. How do you respond? Some managers might spend a great deal of time trying to persuade the boss to reduce her expectations. A more productive response would be to improve management of prices by just 1%.
Many commodity prices seem to be starting to inflate again. Wheat, in particular, has shot up over 25% (see The Economist August 7th 2010 pp94). Wheat is an important input into numerous food products and will likely impact process food prices at retail in the coming year.
You might have noticed by now that Amazon and E-book pricing have been part of the biggest pricing news of the past week. This article touches upon an interesting pricing model, which the author believes will not benefit the actual publishers that wanted to enforce it.
A curious note about Ford’s new pricing strategy on one of their models. As I understood it, they are cutting prices on a new 2011 model but offering a premium for an upgrade to a smaller motor with less power, but with the perk of being an EcoBoost engine. Interesting.
Jim Saunders recently wrote an interesting article published in the 2010 Journal of Professional Pricing from the Professional Pricing Society. The introduction sums it best.
I was speaking with an executive today whose company provides AI software applications. They recently developed one for pricing. Essentially, it crawls the web and provides information on the best prices in retail electronics. I took a look at the site and thought there were some compelling elements to it.