Pricing Strategy Defined
Andrew Hone shares an article on pricing strategy and access to a full report.
There’s no escaping it: pricing is one of the most important aspects of any business. Get it wrong and you can find yourself out of business.
But get it right, and you can achieve a step-change in profitability, generating the free cash-flow needed to turbo-charge your growth.
Pricing is the single-most important driver of profitability for most businesses. We have seen clients drive massive value from a couple of simple changes to their pricing structure.
But what is the right price? And how do you set your own pricing strategy?
The Pricing Success Formula is the culmination of 20 years’ of working with clients on pricing optimisation. Our comprehensive pricing methodology goes beyond the demand curve, combining multiple pricing disciplines and customer research techniques.
Our clients have boosted margins and customer profitability, without suffering the decline in volume and overall revenue that can come from headline price changes.
Why Price Strategy Matters
Pricing is the single most important lever you have. But don’t just take our work for it. A seminal article in the Harvard Business Review compared the impact on profit of a 1% improvement in a range of key business drivers.
Harvard pricing research
For a company with average economics, improving unit volume by 1% yields a 3.3% increase in operating profit. But a 1% improvement in price goes straight to the bottom line, and increases operating profit by 11.1%.
What Do We Even Mean by Price?
When people think about price, their immediate reaction is to think of the headline rate that they are paying for a particular product or service. But for many businesses, the pricing structure is far more complex than this, as you can see.
Key points include:
● Main pricing strategies
● A price execution plan
● Pricing strategy blueprint
Access the article and report, Pricing Strategy, on ZenithStrategy.com.