Pricing Strategy (PowerPoint PPT)

Pricing Strategy is a core pillar of Marketing and Product Strategy. It is 1 of the 4 Ps of Marketing (also known as the Marketing Mix – Product, Price, Placement, and Promotion). As such, knowing how to properly price your product is extremely important to the commercial success and viability of your product offering.

This Pricing Strategy presentation (PowerPoint) provides an in-depth framework on Pricing Strategy; and is organized into the following sections:

1. Pricing Strategy
Price Skimming vs. Penetration Pricing
Consumer Adoption Curve
Advantages and Disadvantages

2. Pricing Approach
Data Collection
Price Curve Analysis

3. Price Sensitivity Analysis
Analysis Approach
Price Sensitivity Financial Model

4. Pricing Tactics and Terminology

Pricing should be an informed, strategic decision based on data, not a decision made randomly or based on trial-and-error. This Pricing Strategy in Marketing PPT teaches you a framework to do Pricing correctly. In fact, this Pricing Strategy framework is the same developed and used by global strategy consulting firms when conducting Pricing Strategy projects for their clients.

Formulating the optimal Pricing Strategy involves considering and answering critical pricing questions, such as:

•  What is the price point to maximize profit?
•  What is the price point to maximize share?
•  What is the price point to capture the Early Market?

Pricing Strategy begins with a decision—to skim or to penetrate the market. Price skimming involves introducing the new product or service at a relatively high price point. Then, with time, as competition increase, the price is dropped. Penetration pricing involves introducing a product or service at a low initial entry price point, often lower than existing competing products in the market.

We have several slides explaining the concepts of Price Skimming (and Market Skimmer) vs. Penetration Pricing (and Market Penetrator), under the backdrop of the Consumer Adoption Curve (and with specific consideration for "crossing the chasm").

This Pricing Strategy PPT also presents a 3-phase approach to Pricing:

1. Data Collection – Pricing data is often difficult to gather. Therefore, pricing data may come from a variety of sources.

2. Analysis & Insights – With the gathered pricing data, the next step is to make sense of the numbers. It is critical to document and be rational with any assumptions made.

3. Pricing – The final phase involves setting the final price point.

Within this Pricing presentation PowerPoint, there is also a detailed discussion of a 5-phase approach to Price Sensitivity Analysis. Price sensitivity is a measurement of how much the price of the product or service affects customers' willingness to buy the offering. This analysis highlights the 9 drivers to Price Sensitivity (e.g. Reference Price Point, Switching Cost Effect, Expenditure Effect, Fairness Effect, Framing Effect, etc.), Pricing Elasticity Analysis, and the Point of Perfect Elasticity.

A supporting Price Sensitivity Financial Model built in Excel is also included with this purchase.

As this is a fully editable PowerPoint presentation, you can also adapt the slides as templates for your own presentations on Pricing Strategy. The various PowerPoint diagrams (e.g. Consumer Adoption Curve, Price Curve Analysis) can be leveraged for your own Pricing presentations.

Additional Pricing tactics discussed include Loss Leader Pricing, Psychological Pricing, Price Discrimination, Predatory Pricing, Cost-Plus Pricing, among others.

This presentation provides a comprehensive analysis of the Price Sensitivity Financial Model, illustrating how to derive and apply pricing sensitivity formulas. It also includes detailed examples of various pricing tactics such as Psychological Pricing and Price Discrimination, offering practical insights for real-world application.