While entering a new market one should look into the pricing strategy, to find out optimal price point, for product & services, to maximise their potential revenue, increase their market share and build a successful sales strategy around it.
The fundamentals of value revolve around the trade-off between the benefits a customer receives from a product or service and the price they will pay for it. Customers do not buy exclusively on price but are driven on value buoyed by the disparity between the benefits a product/service offers and the price that is charged.
- How much will a respondent pay for an added value service/product over and above the present price? OR
- How much of a cutback in service/product requirement would necessitate a price reduction?
MCG pricing strategy research can help to verify pricing assumptions as well as answer the questions of where price/product trade-offs may lie, in addition to where extra value can be delivered. It needs to take numerous factors into consideration, such as emerging trends in the market that may alter perceptions, product inertia or even history of the marketplace (i.e. order of supplier entry into the market).
- How much of a premium is a market willing to pay for your brand relative to your competitors (if at all)?
- What market share could you expect to attain at different price points relative to your competitors?
- Bearing in mind the market and brand positioning, what sort of pricing strategy makes most sense to maximise market share, or maximise revenue or profit?
- What is the maximum price that a brand can charge before losing significant market share to competitors?
- What is the relative influence of price and brand when the market is considering purchasing your product or service?
- Categorisation of the products and services in terms of their similarity among each other while distinguishing the brand’s strong determining factor; behind pricing decision making.
- Analysing the complexities of buying decision, for instance, where the specific features of a product or service are critical?