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This Week in Pricing > 11/23/14

TWIP is a recap of the week’s best pricing focused news, strategy expert and technology leader’s thought leadership, industry news and events, and resources for pricing professionals.

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Strategic Pricing Solutions

Strategic Pricing Solutions, LLC (SPS) is a management consulting firm helping clients with pricing strategies, data analytics, and pricing processes. SPS was formed by Scott Francis in 2005 with a vision of enabling B2B clients to build sustainable strategic pricing capability to significantly improve their profitability. By providing flexibility in how we serve our customers, SPS consulting enables clients to build sustainable strategic pricing capability and continuous improvement in profitability through better pricing decisions.

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Top Headlines

4 Clues That You Are Probably Not Charging Enough For What You Do | Inc.com

Most of us struggle with charging what we are worth, we tend to look at pricing as a number plucked out of thin air, perhaps based on what we think our customers can afford to pay, or even worse, we base our prices on what our competitors are charging, with no idea at all as […]

Pricing Strategy – It IS Rocket Science | Browntape Blog

The other day, I went on eBay to buy myself a handheld microscope. What I noticed was that there were multiple sellers selling what seemed to be the same product at different prices, starting from Rs.599 all the way to Rs.1299. It seemed like a very easy choice to not think further and buy the […]

Raise Prices For B2B Sales Without Losing Your Regular Customers | Business 2 Community

After three years of selling products and services at the same prices, your company decides a change is in order. It’s time to make a few price increases to better reflect the current market and rising costs. Of course, any time prices go up, sellers are bound to hear complaints from long-term customers. Some companies, […]

Do Name-Your-Own-Price Sites Actually Work? | Racked National

It was my first experience negotiating a price online, and, even though all the elements of face-to-face bartering were removed, I still had to work up some nerve. I was fully sucked into Garmentory, a webshop that stocks sale merchandise from contemporary designers and boutiques and lets customers negotiate the final sale price directly with […]

Why the Amazon–Hachette Deal Is Likely Good for Writers and Publishers | The New Yorker

The end of the months-long impasse between Amazon and Hachette over e-book pricing was a bit anticlimactic for those who had been watching the drama unfold. For months, the companies and their supporters had been accusing each other of bad behavior, warped motives, and plain dimwittedness. At one point, Amazon, apparently hoping to put pressure […]

Amazon and Hachette Resolve Dispute | NYTimes.com

The multiyear agreement, which includes both e-books and print books, broadly follows a deal Amazon recently worked out with Simon & Schuster. A source with knowledge of that deal said it was negotiated relatively quickly and gave the publisher control over most of its pricing but offered incentives to sell at lower prices. Amazon got […]

Black Friday prices aren’t all they’re cracked up to be | SiliconBeat

A key retail storyline for years now has been the increasing power of the consumer. Shoppers have the ability to compare prices and inventory online. They showroom and webroom, set price alerts and take retailers up on offers to match prices, hold online orders for pickup at a brick-and-mortar store or deliver the goods the very next day. And this […]

Don’t Make this Mistake When Value Pricing | ROI Selling Blog

“Can I use a value calculator to set my price for my customer?” I hear this question a little bit less frequently than I used to. But at times people still come to me and say, “I want a value calculator so I can figure out how much to charge the customer.” I then ask, […]

Discounting when there is nothing left to the imagination | Inside Retail

“Where price sits in the decision making process depends on various factors and needs to be determined case by case to give a reliable answer,” she says. What we invariably find is that the importance of price varies significantly across 1) different consumer types and segments, 2) different categories, and 3) different brands. Where brands […]

This is how Uber’s surge pricing is supposed to work—if the company isn’t lying to you | Quartz

This means that increasing fares when it rains, snows, or there are simply lots of people who want ride a cab should result in more cabs for riders—exactly the strategy of Uber’s “surge pricing.” Per Farber, an increase of about 14.2% should do the trick, if Uber’s drivers behave like New York cabbies, though a larger increase […]

How you (yes you!) can get around Uber’s surge pricing | Ars Technica

As Uber continues to expand worldwide (and has run-ins with local regulators), it’s become famous for its “surge pricing”—the phenomenon where as demand increases for cars, the price dramatically goes up. New York State went so far as to put a cap on the practice during “abnormal disruptions” in July 2014. Recently, a North Carolina man was […]

Uber reaches out to Gov. Sandoval on state regulations | Las Vegas Review-Journal

Taxi companies also are required to bear the expense of vehicle inspections and driver background checks. Uber prices vary by location but usually are 10 percent to 20 percent below local market rates. Uber, however, practices dynamic pricing — also known as “surge pricing” — which increases rates during peak-use periods. The Uber app notifies […]

Dynamic Pricing Set to Take Off in College Football | Ticketing Today

Not a One-Size-Fits-All Solution While Rutgers and other schools have experienced success, not everyone is sold on the strategy. Some schools, such as Arizona State, experimented with dynamic pricing and saw no change in ticket sales. Other schools are worried about turning off fans who buy tickets at one price, only to see them offered […]

Brought To You By Your Mobile Device – Dynamic Pricing, This Holiday Season (And Beyond) | Thinking the Ink

Nearly half of what U.S. consumers purchase today is influenced by a smartphone or tablet — a mobile device that’s now a necessary companion on just about any shopping trip. So it’s also no surprise that the mobile environment is also influencing the growth and expansion of “dynamic pricing,” a model by which retailers adjust prices dynamically […]

Why Dynamic Pricing is More than a Buzzword in Online Retail – Amazon Strategies | Channel Advisor

Dynamic pricing; you’ve probably heard of it and there’s a good chance that you’re confused by it. You might even be scared off by it due to the recent drama caused by Uber riders who received bills of several hundred dollars due to “surge pricing” on Halloween. However, the aim of this article is to […]

While Football Ticket Prices Soar, Auburn Struggles to Profit | WSJ

Several football schools have tried to capture more of this ticket value with dynamic-pricing methods that measure demand before adjusting prices to maximize single-game ticket sales. These models don’t affect season tickets. Rutgers, which introduced dynamic pricing this season for its Big Ten home games, said it projects about $400,000 in increased revenue. The process […]

Companies tout dynamic-pricing tools at PhoCusWright Conference | Travel Weekly

Dynamic-pricing capabilities for hotel rooms, airplane tickets and restaurant reservations appeared to be a recurring theme during the first morning of the three-day PhoCusWright Conference in Los Angeles on Tuesday. Options Away, WorldMate and Table Grabber — all touting their companies’ dynamic-pricing technology — were among the first batch of the 32 companies giving seven-minute […]

The Saudis say there is no price war, but they are experts at “sweating” their rivals | Quartz

In his day, John D. Rockefeller indignantly denied he sought to brutally “sweat” and crush his rivals. Yet, through his company Standard Oil, most of his rivals were indeed driven out of business and he ended up controlling 90% of the American petroleum market a century and a half ago. In the latest version of a […]

T-Mobile CFO – We’re not in an all-out price war | CNET

Contrary to popular belief, T-Mobile isn’t looking to drag down pricing in the wireless business. That’s according to T-Mobile Chief Financial Officer Braxton Carter, who made his case for growth and the company’s financial well-being at an investor conference on Thursday. “I don’t think it’s an all-out price war,” Carter said. “There have been a […]

Forrester’s 2015 cloud predictions – Docker rises, storage pricing war claims lives | Yahoo News

Cloud storage pricing wars will claim lives. Basic online backup is not a sustainable businesses when fronted on its own, Forrester says. The companies that realize this the fastest will obviously have a better shot at avoiding casualties. “In 2015, enterprise online backup providers must either make the leap to disaster-recovery-as-a-service (DRaaS) and provide workload […]

Wal-Mart told store managers to match online prices with Amazon | Reuters

Nov 13 (Reuters) – Wal-Mart Stores Inc has informed managers of its roughly 5,000 stores across the United States that they can match prices with Amazon.com Inc and other online retailers, the head of the company’s U.S. business said on Thursday. Greg Foran said the directive was meant to formalize a practice already in place […]

Markdown Vs Everyday-Low-Prices – The Impact of Regret and Availability Misperceptions | Ideas for Leaders

Retailers searching for the best pricing and inventory strategies must take into account the behavioural motives of their customers described above. Specifically, these behavioural motives can determine whether a markdown strategy (starting at high prices and then reducing them over time) or an everyday-low-price strategy (keeping prices down at all times) is more profitable. The […]

The Forgotten Shores of App Store pricing | Six Colors

Monument Valley’s Forgotten Shores expansion pack came out this week, a $2 in-app purchase that added eight new levels to the $4 game’s original ten. And not long after, the complaints—in the form of one-star app reviews—began to pour in. Plenty of people, including your correspondent, clucked their disappointment that people would write overwrought complaints […]

HHS Withdraws Proposed 340B Drug Pricing Program “Mega Regs” | Healthcare Law Today

The Department of Health and Human Services (HHS) has withdrawn its greatly anticipated 340B Drug Pricing Program (340B Program) proposed regulations. The proposed regulations, nicknamed the 340B Program “Mega-Regs,” had been drafted by HHS and sent to the White House Office of Management and Budget for review in April, but had not been made available […]

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Events & Resources

 

Events

Webcast: Learn How B&B Trade Distribution Centre Uses Strategic Pricing Tools to Identify Price-sensitive Products and Services | SPA

When: Tuesday, December 9, 2014 2:00 PM Eastern

Register to attend our webcast that starts at 2:00 PM EST where Robb Howe, General Manager for B&B Trade will share their journey to pricing excellence and how they are leveraging science-based strategic pricing tools to identify price-sensitive products and services. To implement a solution that enhanced profitability, […]

Conference: Strategic Pricing Conference | SPA

When: January 15-16, 2015

Where: Ft. Lauderdale, FL at the Ritz Carlton

Learn how leading manufacturing and distribution executives have unlocked the keys to faster growth, stronger customer relationships, and market-leading profitability with SPA’s proven strategic pricing processes and technology. Event Overview Equal parts strategy and practical tactics, this complimentary Strategic Pricing Executive Overview event at the Ritz […]

Seminar: The Value-based Pricing of Innovation | Stage-Gate International

When: April 14-15, 2015

Where: Washington DC

Early Bird Price: $1495 US Are you capturing the value of your innovation? Firms are pouring billions in innovation investments every year with the goal of creating differentiation and competitive products and services. Many, however, forget two critical elements in the innovation management process: the clear definition and measurement of […]

 

Pricer’s Points Blogs

Pricer’s Points: Finding Your Pricing Mojo – YEAH BABY! | David Mok

The word “mojo” derives from an African language and relates to magic and spells to generate luck and power. In today’s language, the word still refers to a source of vigor, energy, sexual potency and power. An entire Austin Powers movie was devoted to lost mojo and the desperate search to find it. Austin Powers […]

Pricer’s Points: 5 Tips on Market Segmentation | Frank Luby

An Inc. article this week asked whether Apple could kill the freemium music model when it relaunches Beats Music. It also cited some data and interesting analyses from Venrock’s David Pakman on how much people spend on music. Think about that phrase for a moment: “how much people spend on music”. Music spending and music […]

Pricer’s Points: Psychological Pricing and Localized Pricing Strategies | Chris Krystalowich

Over the course of my career, I am often asked for information and strategies for selling into other markets. I have compiled these requests into this article; hopefully you will find this information useful. Charm Pricing In English speaking markets, it is widely believed that prices ending in 9 generate more sales. This theory has […]

 

Top Discussions

Discussion: 9 Ways Your Pricing Strategy Sucks

Why do I want to talk about pricing? There is a disease called “Price Discounting.” It is like heroin. It will kill you and your business. Let me give you an example to explain this: You make a 40% gross margin. You decide one day to reduce your prices by 6%. That means that you […]

Discussion: Designers speak out on Adobe price controversy

What do CC users think about paying different rates depending on how they accessed Adobe’s site? Sorry guys! Usually on a Friday we tend to avoid the heavy stuff, and get you in the mood for the weekend with something like a fun quiz or a look at the latest Lego creation. But today there […]

Discussion: Where is Pricing headed?

Pricing as a vocation has been around for a number of years but really ‘heated up’ in the last 10 years or so as companies of all sizes realize they need to better manage this critical area. Jumping on this bandwagon of recognition for having a Pricing Strategy, companies developed Pricing teams of all different […]

 

Books

As a service to pricing professionals, we have compiled a collection of over 75 of the best pricing focused hard-copy books and e-books available. The entries for each book are tagged by subject matter, include the author(s), publisher, date of publication, a picture of the front cover, and a brief summary.

Superior Customer Value – Strategies for Winning & Retaining Customers (3rd Edition)

Summary: A customer-centric culture provides focus and direction for the organization, ensuring that exceptional value will be offered to customers — this, in turn, results in enhanced market performance. Unfortunately, caught up in the daily economic and competitive pressures of running complex and fast-changing businesses, managers may lose sight of customers’ desires. And, consequently, customer […]

Techniques of Value Analysis & Engineering (2nd Edition)

Summary: This book shows management and professional people specific steps to disciplined thinking, which will give them from 25 to 50 per cent more efficiency – both in the quality and quantity of their mental work. Through improved problem solving, creativity, and decision making, you can increase the value of your products or services, either […]

The 1% Windfall – How Successful Companies Use Price to Profit and Grow

Summary: “This breakthrough ‘how to’ book offers a practical and comprehensive framework that shows companies how to use price to drive profits from diverse customer segments in offensive and defensive (recession, inflation, and new competitor) situations.” — Richard Spaulding, Member of the Board of Directors, Scholastic Corporation Rafi Mohammed, author of The Art of Pricing, […]

 

Cartoons

One should always take a little time out to enjoy the lighter side of their profession. Enjoy the following sample from our collection of our favorite pricing related cartoons.

Price Transparency

 

Quotes

One should always take a little time out to enjoy the lighter side of their profession. Enjoy the following sample from our collection of our favorite pricing related quotes.

“The single most important decision in evaluating a business is pricing power,” Buffett told the Financial Crisis Inquiry Commission in an interview released by the panel last week. “If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by 10 percent, then you’ve got a terrible business.”

     – Warren Buffett

 

Other Resources

Pricing Resources

The source for valuable pricing resources including: academic programs, articles, blogs, books, cartoons, certifications, papers, quotes, reports, training, and videos.

Pricing Books and E-books

As a service to pricing professionals, we have compiled a collection of over 75 of the best pricing focused hard-copy books and e-books available. The entries for each book are tagged by subject matter, include the author(s), publisher, date of publication, a picture of the front cover, and a brief summary.

Pricing Certifications

The source for top formal pricing certification programs.

Pricing Training

The source for top formal pricing training programs and service providers.

Pricing Videos

Enjoy our collection of our favorite pricing related videos and share your favorites with us and we will add them to the collection.

Pricing Tech

The source for pricing technology vendor related information and resources.

Pricing Experts

The source for pricing strategy expert vendor related information and resources.

Pricing News LinkedIn Group

Join 1,000’s of your peers in the our LinkedIn discussion group. The group offers a place to share the latest pricing strategy and technology, news, events, resources, thought leadership, and discuss the latest pricing related successes and failures in the news.

 

About Pricing News

Pricing News is a sponsor supported organization dedicated to providing free high-value resources to pricing professionals. It is the source for daily and weekly digests of pricing strategy and industry newsevents, thought leadership articlesblogsreportsacademic research, and other resources and special offers. We also share highlights from top pricing discussions and publish articles from pricing practitioners in our Pricer’s Points blog series.

Join the Pricing News LinkedIn group and learn from your pricing peers and industry thought leaders or get your Pricing News on Twitter or Google+.

Until next week,

Matt Balfour

Founder & Managing Director of Pricing News

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