Price Strategy

Pricing strategy research can help to verify pricing assumptions as well as answer the questions of where price/product trade-offs may lie, in addition to where extra value can be delivered. Pricing strategy research needs to take numerous factors into consideration such as emerging trends in the market that may alter perceptions, product inertia or even history of the marketplace.

Finding the right pricing is probably one of the hardest questions businesses have to answer. Customers purchase decisions are the result of factors such as product availability, competing alternatives, purchase occasion, perceived product value, brand perception, situational factors and price. Hence, pricing research needs to consider these factors to be able to provide accurate answers.

Benefits of Pricing Research

  • Guide decisions on whether to increase or decrease prices
  • Show the impact of changes in pricing strategy on your company structure cost and revenue model
  • Provide optimal price points for new products and services
  • Identify price points that maximize market share, revenues and profit margin for your products and services
  • Indicate how your competitors may react to price changes your company implements
  • Pinpoint sources of market share gains due to price reductions
  • Identify which competitors you may lose share to if they initiate a price reduction

Pricing research usually concentrates on customers' sensitivity to pricing. This price sensitivity is driven by the nature of the market, the target within that market, the differentiation level of your product or service, and the value of your brand. If you are making decisions with pricing research about the overall price-feature offerings for your brand or product category, we recommend simultaneously addressing the brand positioning question. As part of our Pricing Research services, we consult with you on the market and brand positioning issue, and your current stage in the decision process. Our discussion on the Decision Pathway shows how we view the strategy decision process. In the quantitative phases of pricing research, we may conduct market segmentation research, and positioning research which involves concept testing and price sensitivity conjoint analysis. Consumers are more sophisticated and demanding than ever before. Furthermore, markets are becoming more competitive and are constantly evolving.

Developing the right pricing strategy has, therefore, never been more crucial to the growth of your business. Our techniques are designed to understand the trade-offs that respondents make when selecting and acquiring products and services by using different price sensitivity models and value maps.