New B2B product pricing

Abstract

Purpose The purpose of this paper is to investigate the characteristics that lead to the adoption of the three new business-to-business (B2B) product pricing strategies, namely, skimming pricing (i.e. a high initial price), penetration pricing (i.e. a low initial price) and pricing similar to competitive prices. Design/methodology/approach To achieve the study’s research objectives, data were collected through a mail survey from 116 B2B firms, operating in four different sectors. Findings The adoption of skimming pricing and penetration pricing is triggered by company-related factors that are associated with the company’s corporate and marketing strategy and the product characteristics, while the adoption of pricing similar to competitive prices is influenced by market-related factors that are associated with customers’ and competitors’ characteristics. Practical implications The above findings indicate that the managers responsible for setting prices for new B2B products should follow a “situation-specific approach” and be guided by the unique characteristics of their internal and external environment. Originality/value Its contribution lies on the fact that, building upon quests within the existing literature, it constitutes one of the first attempts to examine empirically the aforementioned issue.