Smarter Pricing: How to capture more value in your market

Intention-based research

Some companies use pricing research to uncover buyers’ intentions. They endeavour to gather meaningful customer input in a competitive context. Customer research on prices is notoriously difficult to interpret and sometimes unreliable.

According to Baker, Marn and Zawada (2001) writing on the subject of setting Internet prices, customers claim to buy on-line for the lower prices. Yet their behaviour tells a different story. McKinsey & Company research showed that 89 percent of on-line book buyers bought from the first site visited. Similarly with 84 percent of toy buyers and 81 percent of music buyers. Fewer than 10 percent of Internet purchasers – according to a separate survey – turned out to be deliberate bargain ...