I resolve to: Set prices according to the value we bring to customers, not according to my costs. Use the rich data I have in my transactions and CRM interactions to better understand my customers’ needs, how they react to prices and offers, how their prices compare to similar customers and situations, the reasons we […]
Earlier this month there was an article in the Wall Street Journal, Why Gadget Warranties Are (Almost) Never Worth It, pointing out the disadvantageous math behind most extended warranties and chastising sellers for offering them. From my perspective extended warranties are good examples of when multi-part pricing makes sense, and they can be a win […]
Holiday sales are growing in line with expectations, although the level of promotional activity raises questions about the most important outcome: profits. In this issue, we recap November and early-December sales results, take an in-depth look at the volume of promotions and its implications, and offer ideas for infusing more profitable strategies into holiday pricing. […]
Ever wonder how much the price you pay for an All-You-Can-Eat (AYCE) buffet influences how you feel at the end of the meal? To explore this idea and address the lack of studies that do, this study examines whether pricing affects key indicators such as overeating, physical discomfort, and guilt. Researchers discovered that lower paying […]
I have written a number of blog posts about pricing strategies and business strategy in general. Setting strategy is fundamentally about making choices regarding where you compete and how you win. A very important part of making those choices is understanding how those choices affect other market constituents over a longer term. More specifically, considering […]
Salespeople go into negotiations with professional buyers on a daily basis, most without real negotiation training. Further, many sellers and their managers don’t really believe negotiations play a role in their world. But they do. The following article discusses why Distributors need to revisit the lost art of negotiation. Excerpts of the article authored by […]
Execute Your Plans with Courage, Not Hubris | Strategic Pricing Solutions
If the team has identified certain products as being superior to competing alternatives, and has quantified how that superiority creates value for customers versus the alternatives, those products should have higher prices than the competitors’. If that means raising some prices more than expected, so be it. If the team is afraid to execute the […]
Customer Value: The Price of Paradise | Strategic Pricing Solutions
Earlier this year, my wife and I moved to Florida. With year-round nice weather, palm trees and white sandy beaches, it seems like Paradise. Last week Hurricane Irma came through and reminded us of the true price of paradise. It also reminded me that buyers make trade-offs in every purchase decision, and your pricing strategies […]
Segmentation Is a Critical Part of Channel Management | Strategic Pricing Solutions
The challenge that Under Armour is facing is the exact reason most luxury brands limit their channels to high-end stores where shoppers are not price-sensitive. If the luxury brands want to target more price-sensitive customers, they develop new products or brands that do not have the same cachet or premium pricing. By doing so, they […]
Lower Concession Prices May Backfire | Strategic Pricing Solutions
The Atlanta Falcons have established a new concessions pricing strategy for the coming season, and they will have the lowest prices in the NFL. They are lowering most prices in an effort to be more fan friendly. I am not a scrooge, but I think it is a bad decision. At best, they will make […]
Focus on the Segments Before Lowering Prices | Strategic Pricing Solutions
Last week there was an article in the Wall Street Journal, So Long, Hamburger Helper: America’s Venerable Food Brands Are Struggling which discussed the declining market shares of some of the largest packaged food companies. It is not a surprise; the large CPG companies have been losing customers for the past few years on multiple […]
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