European Pricing Handbook Part 01

Whilst businesses can benefit greatly from an effective pricing strategy, in practice, few actually manage to make long-term meaningful improvements. Many would rather cut costs rather than increase their prices, fearing that any change could turn away customers. To help, in part 1 of this eBook we have compiled thought provoking case studies from well known B2C companies, to give you a sample of some of the most effective pricing strategies currently in use.

How to Design an Effective Regional Pricing Strategy

Industry leaders continue to push the envelope about pricing capabilities and strategies—yet, the science remains inexact. Even in the face of innovations in automation and analytics, pricing experts often struggle to identify and implement the appropriate procedures on a circumstantial level.

A few select industries spearheaded the development of value-based pricing as a regional strategy, most notably in the medical device industry. Over time, this strategy proved effective in reflecting local consumers’ willingness to pay.

This article provides an analysis of the benefits and trends in regional pricing, and the factors that need to be considered in order for this strategy to be executed effectively.

Adopting Best Practices in Geo-Regional Pricing

Regional pricing can be an organic, spontaneous process of discovery - and the underlying signal mechanism is regional data. It is an extremely effective (and cost-effective) use of the divisions of dispersed knowledge among the company workforce. It is the quality of the resultant data which determines the future efficacy of otherwise abstract or loosely related information.

Experienced regional merchants and managers should review strategic decisions with regards to price, product selection, promotion and competitive intensity. It is important not to rely too heavily on any one manager in a region, given the potential for cognitive biases or personal agendas.