When Customers Help Set Prices

To many managers, the idea of involving customers in pricing decisions seems counterproductive. But it may be time to reexamine that assumption.

Marco Bertini and Oded Koenigsberg

June 17, 2014

For most companies, pricing has long been a sensitive, private affair. Management has a fundamental obligation to recoup costs and earn an adequate return. But it’s worth asking: Is your pricing model one of your core competencies? And does it provide you with a competitive advantage? If your answer to these questions is “no,” then it may be time to rethink the way you look at pricing.

This article is directed at managers who seek to profit from differentiation. If you sense that your company is leaving good money on the ...