Establishing Customer ROI Criteria for Pricing PPT

This PPT slide, part of the 47-slide Value-based Pricing Strategy PowerPoint presentation, focuses on the critical step of identifying an acceptable return on investment (ROI) for customers within the context of a value-based pricing strategy. It emphasizes that customers must have clearly defined ROI rules that influence their purchasing and investment decisions, particularly for capital expenditures. This understanding is vital for aligning pricing strategies with customer expectations.

The content outlines that these ROI rules typically encompass various criteria, such as payback periods, positive net present values, or specific ROI targets. The slide stresses the importance of knowing these criteria, as they are essential for determining what customers would consider a fair value split. This understanding directly impacts the acceptable price range for the offerings.

A notable point is the emphasis on establishing trust with customers. The slide indicates that before delving into sensitive ROI discussions, it is crucial to build a relationship that assures customers of confidentiality and the careful handling of their information. This trust is foundational for gathering the necessary insights into customer criteria.

The structure of the slide presents a clear progression in the pricing strategy process, indicating that this step is part of a broader framework aimed at determining an equitable split of value. The subsequent steps mentioned—identifying the next-best alternative and protecting the core value of the offering—suggest a comprehensive approach to pricing that considers customer perspectives and market dynamics. Overall, this slide serves as a guide for executives looking to refine their pricing strategies by aligning them with customer-defined ROI expectations.

This slide is part of the Value-based Pricing Strategy PowerPoint presentation.

Designed by a firm of ex-consultants from McKinsey, E&Y, and Bearing Point, this presentation breaks down a consulting framework on Value-based Pricing. Value-based Pricing is a superior approach to Cost-based and Competitive Pricing.

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