Название: Pricing: A Guide to Pricing DecisionsАвтор: Ragnhild Silkoset
Издательство: De Gruyter
Год: 2023
Страниц: 168
Язык: английский
Формат: pdf (true), epub
Размер: 52.0 MB
This book on pricing decisions gives practical guidance on how to identify customer value, estimating customers’ willingness to pay for these benefits, and on how psychology affects customers’ perception of prices in a market. This strategic view on pricing gives the reader a competitive advantage. It empowers them with means to plan and perform a pricing strategy based on their value propositions.
The target group for this book is managers, entrepreneurs, and business students. The book guides students in understanding how economics, strategy, marketing, and psychology are combined when it comes to pricing decisions. Further, the chapters contain step-by-step procedures that help managers and entrepreneurs to succeed with complex pricing decisions in busy workdays. The analysis is based on the basic edition of Microsoft Excel software.
In sum, the book helps the reader to strategically plan, execute, and win price competitions. The book covers topics such as dynamic pricing, estimation of customers willingness to pay, price competition and wars, customers’ reaction to unfair prices, and price tactics and strategy. The book includes specialized chapters on pricing in e-commerce, and pricing in the sharing economy.
One of the most difficult decisions a business manager must make is in pricing their products. If they price too low, they risk not covering the costs or generating profit. If they price too high, they can risk potential customers never becoming paying customers. Important questions in pricing decisions include the following:
• How should I price my products?
• How much will sales change if I increase the price?
• To whom will the product lose market share if I change the pricing?
• What value do the customers put on the different product benefits?
Price is one of the most flexible elements in the marketing mix, and it has a direct effect on the profitability and cost efficiency of a company. However, even though price has a major impact on companies’ earnings, it has, until a few years ago, been partly overlooked in academic research. In marketing, we see that the predominant focus is on product innovations, brand building, distribution channels, and communication on social media. Price is treated as the easiest factor to adjust, but unfortunately many price changes are based on intuition, gut feeling, or the marketer’s personal experience.
Strategic plans for a company’s pricing policy require one to adapt to the competitive situation, the company’s profitability targets and sales, long-term survival, flexibility, the company’s management structures, the company’s strategic objectives, and routines for enforcing price tactics. The purpose of this book on pricing decisions is to present a basic tool for pricing strategy that can be used by students, companies, and entrepreneurs in all phases.
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