What is your strategy to boost profits in a growing and booming economy? How will you optimize customer behavior and monetize on the willingness to pay of your customers? How can you shift back from a predominantly internal and cost-cutting focus to an outside-in focus, resulting in smart monetization of market opportunities?
80% of the respondents in our Global Pricing & Sales Study (GPSS) think that TopLine growth through pricing is the biggest driver of future profit growth, as cost reductions become less feasible. Despite these beliefs and the fact that pricing has a substantial and immediate impact on a company’s profitability, it is too often neglected as a source of innovation and driver for profitable growth. This whilst many successful companies, turn out to be successful in pricing. They outperform their peers by smartly quantifying, defending and monetizing their value in the market and forcefully monitoring their actual pricing across customers, channels and countries.
We have identified seven key pricing trends that can help you to improve pricing power, redefine commercial strategy and provide inspiration for profit growth.
- Dynamic Pricing: Four pitfalls to avoid
Over the last decades dynamic pricing was introduced in the travel industry. Now other companies in business to consumer environments, retail and etail also start to see the potential of dynamic pricing. Which pitfalls should they avoid? What should be checked before introducing dynamic pricing? ... Read more.
- Behavioral Pricing: Instrument for revenue growth
When you were last visiting Starbucks, did you pick the small or the large coffee? Your choice may have been influenced by what we call 'behavioral pricing tactics'. We see three behavioral pricing opportunities to influence customer behavior and exploit willingness-to-pay. ... Read more.
- Digital Pricing: Right pricing for new business models
In many industries now is the perfect time to start digitalizing channels, product offers and pricing. But how do you embrace digitalization? How can you revise your pricing model to be more beneficial to the customer whilst having an uplift on the provider's bottom-line. ... Read more.
- Customized Pricing: Fully capture customer value
Salad chain Salata offers 28 options to customize your salad. They apply what we call a customized pricing strategy to fully capture customer value. Digitalization is the key reason for the rise of customized pricing, but what should you keep in mind when applying customized pricing? … Read more.
- Defendable Pricing: Align price structures
Prices have never been as transparent as now. Consumers and buying divisions compare prices internationally, searching for the best deal, leading to negative price spirals and decreasing margins. Defendable pricing can be a solution, but how do you optimize your defendable pricing strategy? … Read more.
- Servitization: Key strategy to drive profitable growth
Servitization has emerged as a key strategy to drive sustainable growth. By shifting from a traditional product-centric model to selling a total solution combining a range of services around the product, you change your business model. We see four best practises. ... Read more.
- Sympathetic Pricing: Create brand supporters
When the transport system in London was disrupted, Uber offered discounts to customers that were suffering from the delays. They applied a sympathetic pricing strategy, trying to turn a negative experience for a customer into a positive one. Why is this a smart strategy? ... Read more.