Performance Metrics of Pricing Leaders vs. Laggards PPT

This PPT slide, part of the 24-slide Pricing Strategy: B2B Markets PowerPoint presentation, presents findings from the Dynamic Wargaming Study, focusing on the performance of pricing leaders versus laggards in a B2B context. It highlights how leaders, who adopt a "managing by profits" strategy, achieve significantly higher profits compared to their lagging counterparts. The left side of the slide quantifies these profits, showing leaders at 263.1 monetary units, while laggards are at -280.3, indicating a stark contrast in financial outcomes.

The graphical elements on the right detail various transactional metrics. The first metric illustrates the percentage of transactions involving "poaching," with leaders at 40% and laggards at 18%, showcasing a 122% increase for leaders. This suggests that leaders are more adept at capturing market share from competitors. The second metric, concerning transactions with retaliatory actions, shows that leaders engage in these actions 1.6% of the time compared to 5.7% for laggards. This indicates a more strategic approach by leaders in maintaining long-term relationships.

Further metrics reveal that leaders experience a 65% increase in transactions involving "switching," with 28% of their transactions affected, compared to 17% for laggards. The average duration of customer-supplier relationships is also significantly longer for leaders at 1.80 years versus 0.58 years for laggards, reflecting a 68% difference. Lastly, the average contract price shows a slight decline of 6% for leaders at 71 monetary units compared to 67 for laggards.

Overall, the data underscores the importance of strategic pricing management in driving profitability and sustaining customer relationships.

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Pricing Strategy B2B Wargaming