Pricing It Right

Abstract

Price is one of the 4Ps that captures value for the company, while the other parts of marketing create value for stakeholders; therefore, getting pricing right is crucial to profitability. Setting the proper price is always a huge challenge and strategy because it must satisfy customers and boost corporate profits. Managing price can boost a company's margin by 7% annually. Traditional pricing setting increases risk and misses possibilities. Data-driven decisions and a rise in analytics have made price decisions more precise for customers and the company. Pricing and analytics can help capitalize on latent benefits and gain a competitive edge. Pricing analytics aims to offer the appropriate price to the right consumer through the right channel. Multiple pricing models can enable analytics-enabled pricing decision making, such as solver-based price optimisation, sensitivity analysis and demand curves, linear and nonlinear regressing, etc. This chapter will explore the above and other analytically enabled pricing approaches to set and strategically adjust prices.