Smart pricing
-
Upload
randy-aimone -
Category
Business
-
view
861 -
download
0
description
Transcript of Smart pricing
![Page 1: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/1.jpg)
Smart Pricing
![Page 2: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/2.jpg)
![Page 3: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/3.jpg)
Till Plant Weed Harvest
Farmer’s Harvest
![Page 4: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/4.jpg)
Harvest Time!
![Page 5: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/5.jpg)
Till Plant Weed Harvest
Farmer’s Harvest
Develop Create Market Sell
Business Cycle
![Page 6: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/6.jpg)
8%
![Page 7: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/7.jpg)
The 4 Levers- 1% better
Variable CostsSales Quantity
Fixed Costs
Price
![Page 8: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/8.jpg)
The 4 Levers- 1% better
Fixed Costs 2.45% Increased Profits
![Page 9: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/9.jpg)
The 4 Levers- 1% better
Sales Quantity3.28%Increased Profits
![Page 10: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/10.jpg)
The 4 Levers- 1% better
Variable Costs6.52%
Increased Profits
![Page 11: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/11.jpg)
The 4 Levers- 1% better
Price10.29%Increased Profits
![Page 12: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/12.jpg)
A 1% difference..
Fixed Cost Sales Quantity Variable Costs Price0
2
4
6
8
10
12
increased profit
![Page 13: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/13.jpg)
The 3 Simple Pricing Models
•Cost Plus•Competition Based or
“Strategic” Pricing•Consumer based pricing
![Page 14: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/14.jpg)
Cost Plus
My Costs + 25%
![Page 15: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/15.jpg)
‘Strategic’ Pricing
What is my competition charging for a similar
item?
![Page 16: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/16.jpg)
Consumer Pricing
“What can I gouge this suckerCustomer for?”
![Page 17: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/17.jpg)
Which Model are you using?
![Page 18: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/18.jpg)
Why the traditional models
fail
![Page 19: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/19.jpg)
Cost Plus• No incentive for Efficiency gains
• Price Floor
• Leaving money on the table
![Page 20: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/20.jpg)
Strategic• Who’s saying that the competition is
pricing right?
• Moves your product to commodity
• Southwest vs Delta.
![Page 21: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/21.jpg)
Consumer Based• Negotiation skills reign
• Bad Blood
• Biased based
![Page 22: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/22.jpg)
Pay as you wish
![Page 23: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/23.jpg)
4 Price Points for “Fries with that?”
![Page 24: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/24.jpg)
![Page 25: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/25.jpg)
![Page 26: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/26.jpg)
Razors & Video Games
![Page 27: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/27.jpg)
![Page 28: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/28.jpg)
Price Wars
![Page 29: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/29.jpg)
What Did Walmart do to win the retail game?
![Page 30: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/30.jpg)
Think Small
98% of their skus sell less than 20 copies per year
![Page 31: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/31.jpg)
Think Small1 Billion downloads @ $0.33 each= $330,000,000
![Page 32: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/32.jpg)
Think Small1 Billion downloads @ $0.33 each= $330,000,000
![Page 33: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/33.jpg)
Subscription Model
Fresh Videos, on demand
![Page 34: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/34.jpg)
Subscription Model
Fresh Fruits, every month
![Page 35: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/35.jpg)
Snob PremiumWhich sold (nearly 4x) better:
A Chinese silk scarf for $200-300or
A French silk scarf for $2000-3000
Same silk, similar designs, same manufacturer
![Page 36: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/36.jpg)
Snob Premium
WHY?!?
![Page 37: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/37.jpg)
Pay if it worksPay only if it works
model. No results, no pay.
![Page 38: Smart pricing](https://reader035.fdocuments.us/reader035/viewer/2022081413/5478b9edb4af9f4e348b4728/html5/thumbnails/38.jpg)
So what’s the right way to price?