Pricing is often considered more art than science. It requires translating business unit strategy and industry dynamics into pricing strategy, defining new pricing models, setting specific price points, and ensuring that price is not compromised by value erosion. Pricing is mission critical to a company’s competitiveness and profitability. To ensure our clients are pricing for profitable growth and long-term relationships with customers, KHP Marketing’s pricing framework has three elements—price strategy, price setting, and price sustainability. Pricing: Strategy, Setting, Sustainability
Whether a company is selling to a business or end consumers, winning the pricing wars requires a well-designed strategy. In retail, this begins with developing promotions that result in price and quality leadership (perceived or actual) while also limiting competitor response. In business to business (B2B), the pricing strategy should define a company’s role in its industry, spanning all aspects from suppliers to final customers. We call this a “value chain pricing” strategy because it aligns price setting and value creation with all the players along the supply chain. In business to consumer (B2C), a good pricing strategy is adaptive, targeting micro segments of consumers by offering tailored products and services based on their unique requirements and price preferences. When an adaptive pricing strategy is linked with Big Data paralytics it can lead to substantial market share gains without compromising value. Once prices are set, sustaining them is another matter. Price sustainability requires building processes, improving measurement systems and training, and offering incentives across the entire organization.

Immediate Impact, Growing Advantage
We are committed to supporting our clients through jointly executed pricing programs. Companies obtain immediate, quick-win results by deploying innovative pricing strategies fully aligned with customers’ price perceptions, and by defining actions to stop value erosion in transactional pricing. For longer-term advantage, we help our clients develop pricing approaches, analytics, and governance structures—initiatives that on average result in earnings improvement of 5 percent or more of net sales while allowing companies to either maintain or gain market share.