Smarter Pricing: How to capture more value in your market

Chapter summary

• Despite claims that price is the most important factor, customers actually seek value. This comes from a combination of product (or service) performance plus an emotional association.

• Higher perceived benefits will justify a higher price on a value equivalence line. There are six potential ways to build perceptions of superior value in the mind of the customer.

• The value proposition defines the package of benefits and price for a target customer group.

• Focus on the target group. What does it need? What can it afford? Answering these questions can generate opportunities for value innovation.

• Markets, customers and competitors move on and value propositions must be updated.