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Pricer’s Points: The 5 biggest challenges in pricing in Asia | Jesper Hansson – CPP

I was part of a discussion recently about where I see the biggest current challenges in pricing in Asia and it inspired me to share my views with you in this blog.

When it comes to developing powerful pricing strategies and well-oiled pricing departments, Asia is still behind both North America and Europe. There is no doubt in my mind that North America is the leading example for everyone when it comes to understanding the value of a solid pricing setup. Europe started playing catch up to that years ago and things are developing fast here in Asia now – but Asia is behind both North America and Europe. We all know however that once something gains a foothold in Asia, the Asian Tiger mentality takes over and things starting moving fast and when it comes to pricing it is no different.

Where I still see lots of organizations struggle in Asia and it might not only be in Asia, but I will leave you to comment on that after reading this blog, is:

1. Pricing is still widely based on cost or competitor pricing and not on value

I see many companies who have invested large sums of money on hiring great pricing practitioners with great skill-sets but instead of working on understanding the value they add to the customer in comparison to competition, market segmentation, willingness to pay and the core foundation of value based pricing, the pricing team is forced to work on a mix of cost plus pricing and competitor pricing.

The fact that this is happening could in my opinion be because of a lack of understanding of both the customer and the competition and it is considered a “safer option” to price close to the competition. On the other side, I have also seen companies have an abundance of market intelligence and still not utilize it. This could signal a lack of courage to really charge more than competitors even if you are absolutely sure that your product is better and adds more value to the customer than competing products or a lack of belief in your own analysis.

Read complete blog here:

The 5 biggest challenges in pricing in Asia

Jesper Hansson

Owner/Managing Director, Core Pricing Pte. Ltd.

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