This PPT slide, part of the 47-slide Value-based Pricing Strategy PowerPoint presentation, outlines a structured four-phase approach to formulating a value-based pricing strategy. Each phase is designed to guide organizations in maximizing their pricing effectiveness by aligning it closely with customer perceptions of value.
The first phase, "Find the Value Ceiling," emphasizes understanding the maximum price customers are willing to pay. This involves creating an economic model tailored to the customer's business and assessing the potential bottom-line impact. This foundational step is crucial as it sets the upper limit for pricing.
Next, "Create Customer Segments" focuses on segmenting the customer base through research. It prioritizes segments based on various criteria, such as economic impact and time to realize benefits. Tailoring offerings to meet the specific needs of these segments ensures that pricing strategies resonate with different customer groups.
The third phase, "Determine Equitable Split," is about identifying an acceptable return on investment for customers. This involves recognizing the next-best alternative available to them and protecting the core value of the offering. This ensures that the pricing strategy not only meets customer expectations, but also reinforces the perceived value of the product or service.
Finally, "Develop Pricing Structure" suggests employing diverse pricing mechanisms rather than relying on a single approach. It highlights the importance of linking payments to performance, ensuring that customers pay for the incremental value they receive. Other considerations include establishing controls to maintain product integrity and ensuring that the pricing strategy remains adaptable to market changes.
This comprehensive approach provides a clear roadmap for organizations looking to enhance their pricing strategies, ensuring they align closely with customer expectations and market dynamics.
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.
EXPLORE MORE SLIDES FROM THIS PRESENTATION
EXPLORE MORE PRESENTATIONS ON
Flevy is the world's largest knowledge base of best practices.
Leverage the Experience of Experts.
Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.
Download Immediately and Use.
Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.
Save Time, Effort, and Money.
Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.
