Pricing is a particularly difficult discipline to master. What is, for example, the trade-off between pricing and other product or service value attributes? And how can you assess demand elasticity without being influenced by other factors (such as competition promotions or discounts)?
To make matters more complicated, pricing is not as widely understood as other business metrics like sales and growth. In many organizations, there is also a cultural predisposition to emphasize discounting as a selling tool.
Market-driven differences matter too. For example, the most inventive leaders in consumer-facing businesses (B2C) capture revenues by constantly altering prices based on time, venue, platform, and customer behavior.
However, for firms that target other businesses (B2B), where customers are fewer, sales cycles are longer, and transactions are frequently larger, these types of price changes may be less effective. To put it another way, while price optimization is critical in both situations, the approach for executing it may be quite different.
Understanding what to sell as well as how to sell it are two of the most important aspects of running a successful business. After all, there’s no way to improve your bottom line unless you have a fantastic product or service and strong salespeople to move it along. But, how much you attempt to sell those amazing offerings for is every bit as important.
When it comes to placing a price on a finished product, it’s usual for small and medium-sized business owners to overlook the necessity of taking the time to work out the best pricing strategy.
That is to say, price becomes more a reflection of their costs or competitors’ price tags rather than a function of how to strategically boost a company’s own profitability as well as the value its customers place both on the product and the business selling it.
Unfortunately, many business owners fail to recognize that pricing is, in fact, THE MOST IMPORTANT factor in making money.
You’re losing money if you underprice your goods. If you price your items correctly, you’ll be able to surpass your competitors without lowering your brand’s perceived quality.
What do you think a 10% increase in revenue would mean to your bottom line? Consider the following scenario. If everything else stays the same, a 10% increase on a $100 income stream with $90 in expenses will double your profits, assuming you don’t lose any customers.
Sounds easy, right ? Of course, if the price and profit equation were truly that simple, no business would have a problem. However, as we all know, overcoming the barrier between going into the red and climbing into the black is no easy task.
Since you’re here, we assumed you’re one of the many financial decision-makers looking for some advice on pricing. As experienced pricing strategy consulting experts, the team at Pearl Lemon Consulting can offer you that advice, and much more besides.
By establishing the relationships between pricing and the traits valued by distinct strategic segments, as your pricing strategy consulting partner we can assist you in developing pricing strategies for various forms of pricing, such as pricing to retailers, pricing into channels, and industrial pricing. We can do all the following – and more – as part of this:
You know how good your products and services are, but do you really understand what your target audience thinks their value is? Many businesses fail to understand that for modern consumers in both the B2C and B2B markets, value is something they prize over price.
To help ensure that you are not valuing your products and services incorrectly, we will take the time to examine them on a deeper level and help determine if what you currently think they are worth – as in what price you are selling them for – really matches up with market expectations and just what consumers might be willing to pay.
Sometimes just a small change in pricing can have a far larger impact than you might imagine. You may have some understanding of this concept – the .99 ‘trick’ for example – but our pricing strategy consulting services will introduce you to many more.
When do you change your pricing? Who actually does the work? How are you communicating these price changes to your target audience and to your existing customers?
These are all issues that are far more important than you might think, and we’ll help ensure that these processes are working as well as they possibly can.
An increasing number of businesses sell across multiple channels. This can be an excellent strategy that will help you reach all the different demographics you serve more effectively. However, one big mistake we see businesses make is failing to make the pricing across these channels consistent.
This can result in serious consumer and client dissatisfaction. Setting uniform pricing policies will prevent this, and as your pricing strategy consultants, we’ll show you how.
We won’t just come in and arbitrarily start telling you how to price your products based on our experience and opinions of other competitors in your industry or niche. Every piece of pricing advice we offer you will be backed up by clear explanations and proof, so that you have a solid understanding of why it’s being suggested.
There is no one size fits all pricing strategy, and our commitment to bespoke and personalized pricing strategy consulting reflects this in everything we do. We take into account everything that is unique about your offerings and your business – as well as the traits of your target demographics – to offer the best possible pricing strategy consulting that will garner the best possible results when our advice is put into practice.
Interested in learning more about pricing strategy consulting from Pearl Lemon Consulting? Contact us today and let’s talk.