Value Pricing

Price should reflect the value of a product as customers perceive it
(the “willingness-to-pay”)

Value-based pricing is an effort to extract this perceived value from the market. This involves quantifying perceived value and increasing it whenever possible—i.e., when the customer’s willingness to pay for the increased value exceeds the cost of delivering it.

Companies extract the most value by setting prices strategically. To maximize overall profits, they need to determine the price elasticities of their customer segments

Our sophisticated, quantitative methods are used to answer complex questions like:

• How much do quality, distribution, service, etc. contribute to perceived value ?
• How much is a performance improvement of x% worth to the customer in dollars and cents?
• How much will our market share increase if we improve our performance by x%?
• How can we differentiate among customers by the degree of importance
  they assign to quality, service, price, etc.?

Click here to read more about Creating Targeted Value.

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