Effective pricing strategies shall help a company sell its products in a competitive market to witness a profit. So, what are price strategies? Well, it is a way or literally an approach to find the competitive price of service or a product in that particular market. This strategy is one of the other marketing strategies followed in the system of every management. It is indeed a known fact that a company's ultimate goal is to maximize their turnover. In order to maximize the profit, one has to choose the right strategy for price setting.
Business magnate might use different combinations of price strategies to increase sales, but finding the right strategy is a crucial step in the journey towards success. Often, the misconceived thought on price setting is, sales volume is directly proportional to profit. An increase in sales volume is expected to increase a company's profit. There are different strategies one can depend on in the process of price setting. A few significant factors are given below.
Penetration & psychological pricing strategies
In order to gain a great market share, many companies embrace the penetration pricing strategy. The company aims to set up a customer-based price in the market. This is primarily achieved by providing a free to low price for their products or services to a limited period of time. This later on, with a revised version comes into the market as a premium product with a little raise in the price. This strategy is implied to meet the expectation that consumers will hop on to new brands when they're priced low. On the other hand, a psychological pricing strategy is a method that embraces a consumer's emotional response rather than considering their rational one. Here consumer ignores the quality of a service/ product but sticks on to the costing price.
Product line & economy pricing strategies
The product line pricing strategy is nothing but, providing service with an option to upgrade upon choosing higher value packs. Consumers are pushed to compare the packages and choose a wise plus cost-effective product or service. The other purpose of the product line strategy is to bring a product or service to the spotlight which had low visibility or recognition earlier. Whereas, economy pricing strategy embraces no to the low marketing cost in product or service promotion. It's more like the budget pricing of a product or service. A great example would be promoting only a certain range of products or services that shall gain specific and quick attention among people.
Customer value-based pricing strategy
This is the most effective method that is followed by many successful companies. Value-based pricing is a nothing but, price setting strategy that exclusively focuses on consumer perceived value of a service or product. This is entirely based on how consumers value the product or service and how they find it worth buying. Many companies that offer unique and high-value products choose this strategy in setting the price. The value-based pricing embraces customer's abilities to buy a product by considering the unparalleled experience upon buying a particular service or a product. Many luxury automakers find customer-value based pricing strategy an effective method of approach. A value-based strategy will enable manufacturing companies to extend the life-cycle of existing products and will help to establish a great bond with value-added suppliers.
Pricing analytics
Manufacturers and service providers predict the future well enough to carry out a price optimization system. They approach the Autobei Consulting Group for a detailed analysis of pricing strategies for automobiles. We evaluate the past performance with a specific set of market conditions and suggest the state of conditions for the probability of profit for your product or service in the market. This will help the automotive industry to gain an insight into pricing strategy. Pricing analytics include the process of finding the underperformers of a particular industry. It's highly crucial to analyze why certain product lines become your cause of down economy. We develop reports exclusively after researching the probabilities and will let you understand the customer value definition with facts and figures.
Customer satisfaction
When a pricing system includes detailed pricing analytics, it will definitely boost the customers' satisfaction. The system of achieving maximum profit with minimum wasted effort shall only be obtained upon consulting the business consultants. ACG shall help you find not only the best pricing strategy for your company but also identify the substitute product or service that might better fit in a customers' budget. This will help your sales team create a budget based service or product that shall come with a package deal to the customers which in turn allows you to enhance customer's ability to purchase.
Almost everything in business aims for justification for the value of a specific price. Customers do not buy a product or service by just seeing the price tag, they meticulously research before buying it. With much of comparisons, they find the right choice that will fit in their budget and lifestyle. Our business consulting services shall help you understand how customers understand the value of a service or product. We consider a lot of factors, impacts on buying decisions with that of other parameters before drawing the conclusion.
Business magnate might use different combinations of price strategies to increase sales, but finding the right strategy is a crucial step in the journey towards success. Often, the misconceived thought on price setting is, sales volume is directly proportional to profit. An increase in sales volume is expected to increase a company's profit. There are different strategies one can depend on in the process of price setting. A few significant factors are given below.
Penetration & psychological pricing strategies
In order to gain a great market share, many companies embrace the penetration pricing strategy. The company aims to set up a customer-based price in the market. This is primarily achieved by providing a free to low price for their products or services to a limited period of time. This later on, with a revised version comes into the market as a premium product with a little raise in the price. This strategy is implied to meet the expectation that consumers will hop on to new brands when they're priced low. On the other hand, a psychological pricing strategy is a method that embraces a consumer's emotional response rather than considering their rational one. Here consumer ignores the quality of a service/ product but sticks on to the costing price.
Product line & economy pricing strategies
The product line pricing strategy is nothing but, providing service with an option to upgrade upon choosing higher value packs. Consumers are pushed to compare the packages and choose a wise plus cost-effective product or service. The other purpose of the product line strategy is to bring a product or service to the spotlight which had low visibility or recognition earlier. Whereas, economy pricing strategy embraces no to the low marketing cost in product or service promotion. It's more like the budget pricing of a product or service. A great example would be promoting only a certain range of products or services that shall gain specific and quick attention among people.
Customer value-based pricing strategy
This is the most effective method that is followed by many successful companies. Value-based pricing is a nothing but, price setting strategy that exclusively focuses on consumer perceived value of a service or product. This is entirely based on how consumers value the product or service and how they find it worth buying. Many companies that offer unique and high-value products choose this strategy in setting the price. The value-based pricing embraces customer's abilities to buy a product by considering the unparalleled experience upon buying a particular service or a product. Many luxury automakers find customer-value based pricing strategy an effective method of approach. A value-based strategy will enable manufacturing companies to extend the life-cycle of existing products and will help to establish a great bond with value-added suppliers.
Pricing analytics
Manufacturers and service providers predict the future well enough to carry out a price optimization system. They approach the Autobei Consulting Group for a detailed analysis of pricing strategies for automobiles. We evaluate the past performance with a specific set of market conditions and suggest the state of conditions for the probability of profit for your product or service in the market. This will help the automotive industry to gain an insight into pricing strategy. Pricing analytics include the process of finding the underperformers of a particular industry. It's highly crucial to analyze why certain product lines become your cause of down economy. We develop reports exclusively after researching the probabilities and will let you understand the customer value definition with facts and figures.
Customer satisfaction
When a pricing system includes detailed pricing analytics, it will definitely boost the customers' satisfaction. The system of achieving maximum profit with minimum wasted effort shall only be obtained upon consulting the business consultants. ACG shall help you find not only the best pricing strategy for your company but also identify the substitute product or service that might better fit in a customers' budget. This will help your sales team create a budget based service or product that shall come with a package deal to the customers which in turn allows you to enhance customer's ability to purchase.
Almost everything in business aims for justification for the value of a specific price. Customers do not buy a product or service by just seeing the price tag, they meticulously research before buying it. With much of comparisons, they find the right choice that will fit in their budget and lifestyle. Our business consulting services shall help you understand how customers understand the value of a service or product. We consider a lot of factors, impacts on buying decisions with that of other parameters before drawing the conclusion.