Pricing Strategy: Pricking the Veil of Value Exchange

/in /by

Our understanding of pricing has come a long way since 1890 when Alfred Marshall published his treatise on the economic scissors of supply and demand. Pricing is no longer a purely economic challenge to be addressed through studies of market elasticity. It can’t be solved by lowering prices until customers’ purchases improve factory utilization rates. And, it can’t be solved by allocating costs and adding markups. Rather, pricing today must be focused on value exchange.

While experts and executives agree that price should reflect value, the pricing to value mantra fails to clarify the decisions executives must make. That is, what is the value that price should reflect? Whose perception of value should determine price? And, how can value be modeled and quantified? In other words, pricing decisions today requires actionable insights.

These insights must derive from a marketing orientation of the firm with a clear economic understanding of value exchange. The marketing orientation focuses the purpose of the firm towards serving customer needs profitably – an orientation supported by the late greats Peter Drucker and Theodore Levitt. The economic understanding of value exchange reminds us that customers will purchase when the product delivers value in excess of its price after adjusting for alternatives, and the firm must deliver products at a price in excess of their cost. These are two very simple concepts.

Combined, the marketing orientation of the firm, and the economic understanding of value exchange, provides the foundation for developing insights required for executive decision making in pricing strategy.

Hi there! This article is available for free. Login or register as a StrategyDriven Personal Business Advisor Self-Guided Client by:

Subscribing to the Self Guided Program - It's Free!


 

About the Author

Tim J. Smith is the founder and Managing Principal of Wiglaf Pricing and an Adjunct Professor of marketing and economics at DePaul University. Well-known in the industry as a thought leader in pricing, Dr. Smith has presented seminars on pricing to professional audiences around the globe. With hard-hitting, focused messages for executives, Tim encourages actions that lead to dynamic results. To read Tim’s complete biography, click here.

StrategyDriven Podcast Special Edition 59 – An Interview with David Aaker, author of Brand Relevance

/in , /by

StrategyDriven Podcasts focus on the tools and techniques executives and managers can use to improve their organization’s alignment and accountability to ultimately achieve superior results. These podcasts elaborate on the best practice and warning flag articles on the StrategyDriven website.

Special Edition 59 – An Interview with David Aaker, author of Brand Relevance explores the creation of offerings so different that they create unique categories within which customers perceive no other product or service alternatives. During our discussion, David Aaker, author of Brand Relevance: Making Competitors Irrelevant, shares with us his insights and experiences regarding:

  • the difference between brand relevance and brand preference
  • advantages of achieving brand relevance over brand preference
  • several key factors needed to gain brand relevance
  • how a company establishes and manages a new category or sub-category
  • how a company maintains brand relevance over time
  • key characteristics and competencies an organization must have to successfully pursue a brand relevance strategy

Additional Information

In addition to the outstanding insights David shares in Brand Relevance and this special edition podcast are the resources accessible from his website, www.Prophet.com.   David’s book, Brand Relevance, can be purchased by clicking here.

Final Request…

The strength of our community grows with the additional insights brought by our expanding member base. Please consider rating us on iTunes by clicking here. Rating the StrategyDriven Podcast and providing your comments online improves our ranking and helps us attract new listeners which, in turn, helps us grow our community.

Thank you again for listening to the StrategyDriven Podcast!

About the Author

David Aaker, author of Brand Relevance: Making Competitors Irrelevant, is Vice-Chairman of Prophet, a marketing consultancy that helps senior executives balance their organization’s short-term business needs against their long-term growth goals, and Professor Emeritus of Marketing Strategy at UC Berkeley’s Haas School of Business. One of the world’s leading experts on branding and the winner of three awards for lifetime contributions to the science of marketing, David has published over 100 articles and fourteen books; including Strategic Market Management that has been translated into eighteen languages. To read David’s complete biography, click here.

Podcast: Play in new window | Download (Duration: 32:45 — 45.0MB)

Subscribe: RSS

Winning Time-Starved Customers

/in /by

Adrian Ott, author of The 24-Hour Customer, was a recent guest on Fox Business Live; sharing her insights on:

  • how to win the business of time-starved customers
  • aligning products and services to meet customer’s needs and time availability constraints
  • synchronizing with the customer so to be positioned to serve them when they are ready to buy

Adrian Ott on the StrategyDriven Podcast

Last month, we were privileged to talk with Adrian about her new book, The 24-Hour Customer, on the StrategyDriven Podcast. Listen as we explore the impact of time on customers’ buying decisions; how to identify the time-value impacts associated with a product or service, the market opportunities created by the impact, and then how to formulate and position one’s offerings to create increased time-value and earn more sales.

Podcast: Play in new window | Download (Duration: 30:57 — 42.5MB)

Subscribe: RSS

Social Media Marketing and the Strategic Shift from Destination to Audience

/in /by

Social media marketing has transitioned from being an ancillary marketing strategy to become a strategic business imperative. All businesses and brands need a social Web presence for a single, fundamental reason – that’s where the customers are. Brands that aren’t represented on the social Web are missing a significant opportunity that another business is more than happy to seize.

Hi there! This article is available for free. Login or register as a StrategyDriven Personal Business Advisor Self-Guided Client by:

Subscribing to the Self Guided Program - It's Free!


 

About the Author

Susan Gunelius is a 20-year veteran of the marketing field and has authored numerous books about marketing, branding, and social media. Her marketing-related articles can be found on Entrepreneur.com, Forbes.com, MSNBC.com, FoxBusiness.com, WashingtonPost.com, BusinessWeek.com, and more. She is President & CEO of KeySplash Creative, Inc., a marketing communications company, and speaks about marketing at events around the world. To read Susan’s complete biography, click here.

StrategyDriven Podcast Special Edition 55 – An Interview with Adrian Ott, author of The 24-Hour Customer

/in , /by

StrategyDriven Podcasts focus on the tools and techniques executives and managers can use to improve their organization’s alignment and accountability to ultimately achieve superior results. These podcasts elaborate on the best practice and warning flag articles on the StrategyDriven website.

Special Edition 55 – An Interview with Adrian Ott, author of The 24-Hour Customer explores the impact of time on customers’ buying decisions; how to identify the time-value impacts associated with a product or service, the market opportunities created by the impact, and then how to formulate and position one’s offerings to create increased time-value and earn more sales. During our discussion, Adrian Ott, author of The 24-Hour Customer: New Rules for Winning in a Time-Starved, Always-Connected Economy, share with us her insights, approaches, and real-world experiences regarding:

  • the money value of time as it relates to customers and their buying decisions
  • the Time-ographics Framework and what information business leaders can glean about their products and services once they are plotted within this matrix
  • several ‘in principal’ alterations leaders can make to products and services to increase their time-value
  • actions business leaders should take to transform time-value insights into a cohesive, go-forward strategy that provides a roadmap to creating new and/or enhance existing revenue streams
  • how business leaders can measure the effectiveness of their time-value initiatives

Additional Information

In addition to the incredible insights Adrian shares in The 24-Hour Customer and this special edition podcast are the resources accessible from her websites, www.24HourCustomer.com and www.ExponentialEdge.com.   Adrian’s book, The 24-Hour Customer, can be purchased by clicking here.

Final Request…

The strength of our community grows with the additional insights brought by our expanding member base. Please consider rating us on iTunes by clicking here. Rating the StrategyDriven Podcast and providing your comments online improves our ranking and helps us attract new listeners which, in turn, helps us grow our community.

Thank you again for listening to the StrategyDriven Podcast!

About the Authors

Adrian Ott, author of The 24-Hour Customer, is the CEO and Founder of Exponential Edge, a management advisory firm that assists leading global corporations in identifying and building new roads to revenue. Consulting Magazine called Adrian “one of Silicon Valley’s most respected strategists.” She has worked with some of the most innovative Fortune 500 and start-up companies in the world; helping them gain a market edge in today’s exponential economy. To read Adrian’s complete biography, click here.

Podcast: Play in new window | Download (Duration: 30:57 — 42.5MB)

Subscribe: RSS