There are three ways of increasing profits: sell more, cut our costs, or raise existing prices.
Raising prices, in principle, is very easy indeed - change the price ticket and price list and tell the sales force to raise prices by 5%. Of course, once we increase prices, customers may start to look elsewhere for a better deal.
It is, however, useful to broaden the discussion on price and think about value – the trade-off between the benefits a customer receives from a product or service and the price they are willing to pay for it.
B2B International's pricing research solutions are grounded in the principles of value marketing. Our thoughts on this important topic are contained below:
A well thought-out pricing strategy is crucial to optimizing both sales volume and profit. This article, part of our series on developing a marketing strategy, aims to explore how you can develop an effective pricing strategy that optimizes both sales volume and profit.
Understanding the position of brands on the Value Equivalence Line (VEL) is important as it leads to strategic decisions on both pricing and product development. This article looks at how a brand can determine its position in relation to the VEL and how this can be used for strategic decision-making.
Written by Matthew Harrison
In response to increasing competition in many business-to-business markets, there is an acceptance that prices have to be reduced, margins squeezed and businesses less profitable. We at B2B International vehemently disagree with this view.
Companies that sell raw materials or simple components face a marketing problem – how to give their products recognisable benefits which differentiate them from competitors. This article seeks to show how to avoid price cuts by adopting a more professional and profitable marketing stance.
Written by Julia Cupman and Paul Hague
Many research studies provide measures on satisfaction and loyalty, but few provide measurements on perceived value. So, there is a need for a new tool that more accurately measures perceived value; this is where the Net Value Score comes in.
Written by Nick Hague
No company wants to leave money on the table and so obtaining the optimum price has always been a key issue to marketers. However, asking customers to quantify the price they would be willing to pay for a product or service is one of the hardest questions for any researcher.
Do you wish to optimise profit? Here you will find out about the value the market puts on your product/service – and what you can charge accordingly. We describe some of the ways research can help you establish what that value is.
Written by Paul Hague and Matthew Harrison
Establishing the value that people put on the goods and services they sell is one of the most difficult tasks for the business-to-business marketer. Finding the right price is a judgement which many get badly wrong – usually charging too little because they don’t realise the value of their offerings.
Written by Daniel Park
Marketers are constantly searching for differentiation. Unless a company has a genuine scientific or technological advantage, preferably one protected by a patent, competitors can often match any incremental change in an ever-shortening time-scale.
How important is price against the other elements of the marketing mix? This article is based on experience from market research and draws a moral.