You're balancing market penetration and profitability. How do you find the perfect price point?
Striking the right balance between market penetration and profitability hinges on finding the optimal price point for your product. Consider these strategies to help guide your decision:
How do you determine the right price for your products? Share your approach.
You're balancing market penetration and profitability. How do you find the perfect price point?
Striking the right balance between market penetration and profitability hinges on finding the optimal price point for your product. Consider these strategies to help guide your decision:
How do you determine the right price for your products? Share your approach.
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1) Set - Use Value based pricing when defining the CVP 2) Refine - Run a conjoint study to find the sweet spot price vs competitors 3) Execute - Align the GTM & Execution plans with the set ambition 4) Monitor and adjust
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A perfect price point should be embedded during product/service development. A profitable market penetration cannot be done unless the market price is in similar level of customer's perceived value. Before product/service launch, a beta testing can be performed to understand perceived value among the customers.
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The price value is related to the service you are providing and the trust you have gained during your relationship with your customers.
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In my experience in B2B pricing, which I’ve developed over years in both multinational and higher education environments, balancing market penetration and profitability requires, among other skills, strategic vision and, above all, "very" analytical approaches. My approach usually combines: 1. Value-Based Pricing: Aligning price with the unique value our product / service offers, ensuring ROI-focused pricing that fits with B2B clients. 2. Segmented Pricing Models: Tailoring pricing (such as volume-based or subscription tiers) to specific customer segments to drive reach and revenue. This, I insist, DATA-DRIVEN strategy will deliver sustainable growth, optimizing profitability across B2B markets and segments.
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To find the perfect price point, start by calculating all production costs, including overhead expenses. Next, set a target profit margin that aligns with your business goals. Finally, consider brand perception and market positioning to ensure the price meets customer expectations and stands out against competitors
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