The Secret of Optimal Pricing Strategy

Understanding buyer behaviour ,whether its in a B2B market, or a B2C market, is a key factor in pricing for success.

Price and pricing strategy is interwoven tightly with all other elements of the marketing mix... change the product and you need to review the price (makes sense?)... change the distribution, you'll also need to modify price, change the advertising mean reviewing price, so does changing processes, changing the people who support the product, changing the positioning... all demand price re-development.

Pricing strategy is about real marketing, real-time: Most importantly price is the least scientifically and most potently powerful sales tool in the marketing mix.

Understanding Pricing Metrics can make profits soar!

Using data-mining techniques, you can discover the right price to sell at, the right price to discount at, the right price to wholesale at, offer RRP for, and re-positioning to, to significantly improve profits with damaging sales. Ask for price optimisation research now for maximum profits.

Value Based Pricing

Value-based pricing uses buyers’ perceptions of value, not the seller’s cost, as the key to pricing. The organisation uses non-price variables in the marketing mix to build up perceived value in the buyers’ minds. Price is set to match the perceived value.

How you can improve price strategy

• FMCG? Use advanced data mining & analysis techniques to identify the optimal discount price point for 'case deal' promotion at retail.

• Juggling Multiple segments? Use scientific product classification analysis to determine the optimal pricing strategy according to buyer behavioural constants observed in specific product category types.

• Need market share growth in a Competitive Industry? Use life cycle analysis to select the best pricing policy for satisfying anticipated customer trends and winning market approval and market share growth.

• Need more profits? Use sophisticated product analysis, market analysis, competitor analysis and product portfolio management methods to forecast future sales with accuracy, generating better production and inventory control.

Economic Value Pricing Strategy

For many industrial products, the costs perceived by customers extend well beyond the price charged.

An industrial purchaser perceives the cost of equipment as including installation, maintenance, training and use of consumables, as well as the basic purchase price.

Equipment purchases are evaluated over their economic lives and comparisons between competitors go beyond straight price assessment.

Going-rate pricing strategy

The company bases its price largely on competitors’ prices, with less attention paid to its own costs or demand.

The company might charge the same, more or less than its major competitors.

In oligopolistic industries that sell a commodity such as steel, paper or fertiliser, companies normally charge the same price.

The smaller firms follow the leader: they change their prices when the market leader’s prices change, rather than when their own demand or cost changes.

New Product Pricing Strategies

The price of a product changes along with its life cycle. The introductory stage is the most challenging stage for new products.

Companies may use marketing-skimming pricing when they introduce innovative new products. Such companies set a high price in order to maximise their profit quickly.

Marketing-skimming pricing: Setting a high price for a new product to skim maximum revenue from the segments willing to pay the high price; the company make fewer but more profitable sales.

Marketing-penetration pricing: Alternatively, companies may initially set a low initial price for their innovative new products when they enter the market.

The lower price can help the company attract more customers and may lead a group of customers to switch from the competitors. Marketing-penetration pricing enables the company to achieve the leader position in the market.

Reasons to engage a pricing strategy marketing consultant

• Get pricing right to deliver higher profits.
• Make core pricing decisions with quiet confidence.
• Effective pricing strategies and tactical pricing initiatives to a expand margins and generate earnings growth
• Pricing Market Research Consultants that segment a market and work hand-in-hand with clients to enhance product pricing strategy and price optimization.

However, if you don't want to include a consultant, we can recommend you have at look at the following: