As a manufacturer of products, you will ultimately need to set the price for your product in the market. There are pricing methodologies which exist to help you in your quest for the optimal price that the customer is willing to pay while maximizing your revenue and profit. Two straight forward examples are cost + or pricing vs. your competition models.
However, they do not always fully highlight your true business goal or intended outcomes; are you going to maximize your profits? You might in fact be leaving money on the table.
Value-based pricing models can help you realize the full potential price of your product. They can also be very confusing to understand or even to put into practice.
In the recent Gocious webinar, "Establish value with Competitive Pricing Analysis" available to watch on-demand, we looked at two value-based pricing methodologies that can help you to price your products and to see how they will compete in the market versus your competition.
Our Co-founder and CTO, Maziar Adl, kicked off the webinar by defining the concept of value-based pricing; A customer-centric approach to pricing that helps you find the maximum price you can potentially realize for your products in the marketplace.
Value-based pricing requires more research and resources than simpler methodologies. It needs to be updated and maintained as the market and your competition shifts. We further explored this by discussing two different pricing methodologies.
The first pricing methodology presented is called Economic Value to the Customer (EVC). This is a way for you to measure the value your product brings to your customers. You would then use that to determine the price you can charge for that product. This is done in conjunction with looking at what your competitors offer and how much they charge for their products.
The second methodology presented is called Value Maps. Value maps are an excellent way to take the pricing decision you have made from your EVC work and then see where it places you in the market versus a benchmark product and other competition products. This is a powerful tool to help you decide where to position your product in the market and to also uncover opportunities for product or pricing changes.
Director of Customer Success, Simon Leyland, then presented a behind the scenes look at what Gocious is working to delivering next as part of the platform. Our unique approach to value-based pricing will help streamline the process and remove some of the resource overheads that make complex pricing methodologies challenging for product experts today.
This new capability will build on the current Gocious platform, which already leverages weighted product scoring to help users unlock the maximum value their products bring to customers.
You can download the webinar video and slides to hear the full discussion and learn more about how Gocious helps product people meet today's manufacturing challenges.