A strong pricing strategy will help drive growth and align profits with value—but it’s not something you can set and forget. Ongoing evaluation of your pricing strategy will allow you to react to market forces and changing customer needs.
Here, we share a list of 5 things to consider when designing or evaluating your pricing strategy. Dive into each question to explore new ways to leverage pricing as a powerful tool for business growth.
Interested in learning more? Check out Untapped’s Pricing Strategy service.
There are three numbers at the heart of all pricing decisions: Value, Price and Cost. Remove the guesswork in setting your prices by having a clear understanding of the costs you incur and what customers are willing to pay for the value your product or service delivers to them.
The space between costs and customer perceived value is the sweet spot for pricing.
Value can take many forms as there may be functional, emotional and social benefits of using your products. Try to quantify the tangible outcomes for your clients (more leads, more sales, more profit, time saved) but also understand what the intangible outcomes really mean to your customers (peace of mind, social kudos, enjoyment).
Ever heard the phrases ‘reassuringly expensive’ or ‘worryingly cheap’? Your pricing needs to tell the same story as your brand.
Your pricing needs to evolve with your business and is a powerful lever for driving business performance. Whether your current focus is improving acquisition, retention, cross-selling or profitability, pricing is here to help!
Spend more? Spend more often? Subscribe? Pay upfront?
Use your pricing as an incentive to nudge customer behaviours.
When the context changes, the value changes.
Where is the value of what you do going down and where is it going up?