At a recent conference, I heard a pricing executive state that the single most effective action you can take to improve profits is to incentivize your sales force based on margin instead of volume. While I agree that it’s helpful to have at least some portion based on margin, in most cases margin-based compensation alone…
In most companies, the pricing function receives limited attention. Data from the Professional Pricing Society (PPS), the world’s largest organization dedicated to pricing, reveals that fewer than 5% of Fortune 500 companies have a full-time function exclusively dedicated to pricing and, according to McKinsey & Company, fewer than 15% conduct systematic pricing research. Although numerous…
Many European-based organizations have only just begun to realize how significant the effect of pricing on shareholder value creation really is. Until now, the focus was mainly on innovation, sales and marketing – and justly so. But in today’s economic environment, value capturing – effective pricing – is increasingly being discussed at the boardroom…
Everyone in business knows it’s all about maximizing profits. And nothing has as much potential impact on the bottom line than smart pricing; the majority of incremental revenue from a price increase flows directly to the bottom line. Indeed a one percent increase in price for most companies often results in a 10% or greater…
Profit leakages can happen at every line of the profit and loss statement. Some are easier to identify than others and can easily be captured in a waterfall analysis to derive pocket price levels for a customer, a market segment or a product category. Others are well hidden in the P&L and require a lot…
Most every sale rep has heard that phrase, “Just meet your competitor’s price point and the business is yours.” One could discuss for hours how and why the sale rep has gotten himself in this position but we’ll leave that for another blog post. Clearly the negotiation has broken down at this point, and closing…
More companies have begun the discovery process on how pricing software provides a profitability lever for their businesses. They’ve identified pain points in their organizations that led them down the discovery path, and they’re looking to quantify the value – the level of profitability they’re able to add to their organizations’ bottom line. It’s a…
The debate of the existence of elasticity in B2B markets is a fun one, for those of us who like to discuss such things. It’s an academic argument that’s far from the reality of life as a salesperson trying to close an individual deal. Those who are elasticity naysayers come armed with demand curves and…
There’s been a lot of attention lately given to the emerging space of Big Data technology. Like you, PROS has been researching the latest technologies to include in our products. Our goal is to deliver prescriptive insights so you’re able to stay ahead of your competitors. In PROS newest product release, PPSS 3.21, we upgraded…
Nicolene Barnard says:
100% agree. Marco Bertini, Professor at London Business School will...
Marcel van Harrewijen says:
Totally agree! There are a lot of product managers who mistakenly...
Steve Sassi says:
Strongly agree! You cannot avoid the commodity trap unless you understand,...
Reno Koepp says:
A great article with many interesting examples of alternative and innovative...
What customers are looking for | kundennutzen says:
[...] often complain because their price is too high. But, according...
