Introducing the RIVR Pricing Model

B2B pricing studies often involve the need to present complex products or solutions to respondents and test their willingness to pay for different combinations of features and tiers of service. This presents a much more complex pricing challenge than is typical of consumer markets and can render traditional pricing approaches impractical.

Further Reading

3 B2B Pricing Challenges and How to Overcome Them

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Van Westendorp and Gabor Granger are well established consumer pricing exercises, but both require the respondent to answer a lot of questions, making them time-intensive additions to a survey. This can be an issue when you need to test multiple tiers of a solution simultaneously. Standard analysis methods also don’t take into account how changing the price of one tier can have an impact on the demand for the other tiers being offered.

Conjoint studies do allow us to model these interactions in detail, but they are even more intensive exercises. They also require multiple solutions to be presented simultaneously and this can be a challenge for complex solutions, where time may be needed to fully digest what is being offered and how solutions differ.

RIVR (Relative Indicated Value Ratio) modelling is our approach to addressing this challenge by applying a simplified Van Westendorp exercise for each tier and modelling the relative appeal of each tier as prices are varied. It allows us to model appeal and preference for each tier across different price portfolios, with a view to maximizing the revenue potential across all tiers.

This approach has been successfully deployed for major clients and has made otherwise impracticable pricing projects feasible.

Interested in using RIVR modelling in your next research study? Get in touch to learn more.

To discuss how our tailored insights programs can help solve your specific business challenges, get in touch and one of the team will be happy to help.