Are your Prices Differentiated Enough?
Intuitively, business managers know that different customers are willing to pay different prices for products, services, bundles or configurations. But if they plot a distribution of what customers actually paid for those offerings, most would find that their pricing has been largely undifferentiated across the market.
Undifferentiated pricing unnecessarily sacrifices margin and yields sub-optimal results. However, without reliable guidance about what customers are willing to pay, it’s only natural for sales and pricing managers to resort to common fallbacks that emphasize revenue over margin realization.
Price Segmentation is Central to Value Pricing
Price segmentation analysis facilitates value-based pricing by examining historical data such as buying behavior to identify customer groupings with similar price response characteristics. Vistaar enables companies to apply price segmentation techniques to define these groupings and generate optimum pricing guidance such as floor and ceiling prices. Having the ability to present customers with pricing that reflects their willingness to pay not only helps maximize financial performance, but also improves customer satisfaction.
Flexibility to Fit Your Path to Pricing Success
Vistaar offers the flexibility for companies to find an approach to price segmentation that’s right for their business environment.
Today’s pricing technology enables sophisticated price segmentation techniques, which until recently, were largely beyond the reach of most companies. As a result, detailed micro-segmentation analysis may suggest dramatic changes in the way pricing is structured across customers. Such changes can be difficult for some organizations to implement with near-term success, as it takes time to prepare data, train sales teams and ease customers into new pricing arrangements.
Vistaar pricing software enables organizations to implement effective price segmentation through a practical crawl, walk, run approach that delivers rapid returns. For many organizations, macro-segmentation, which yields differentiated pricing based on factors such as products, geography and customer size, may be an appropriate starting point. For others, a more advanced mathematical approach, which can define pricing for hundreds or even thousands of micro-segments, may be required. Whatever your case, Vistaar can deliver a solution that delivers maximum time-to-value.
