Pricing: Where Revenue Management Meets Marketing.
I recently posed a question on LinkedIn that sparked a vibrant discussion: "In revenue management, does pricing primarily stem from strategic analysis, or is it a result of marketing and communication efforts?"
In both B2B and B2C contexts, pricing goes beyond being just a number. It is where strategy meets creativity—where data-driven analysis intersects with the art of perception. Pricing is the meeting point of revenue management and marketing, shaping not only the price itself but also how it is perceived by the market. In this article, we’ll explore how pricing is influenced by both disciplines and why achieving the right balance is critical for profitability and customer satisfaction.
Strategic Analysis: The Backbone of Pricing.
Strategic analysis forms the foundation of any pricing decision. It involves leveraging internal and external data to determine optimal price points that maximize revenue.
Understanding Customer Behavior: Whether in B2B or B2C markets, understanding customer behavior is crucial. Tony Rodoni, EVP of Revenue Operations at Salesforce, explains: "Pricing must reflect demand. If we understand when customers are willing to pay more, we can optimize for those periods to increase revenue." For instance, dynamic pricing during peak demand periods is a strategy widely adopted across industries.
Competitor Analysis: Monitoring competitor pricing ensures that your pricing remains competitive. Peter Tedesco, Head of Pricing Strategy at SAP, highlights this: "Pricing today is rarely done in isolation. You need to understand where your product stands in relation to others, not just in terms of cost, but in value." Effective competitor analysis helps you avoid pricing yourself out of the market or missing potential revenue opportunities.
Demand Forecasting: Accurate demand forecasting enables companies to adjust pricing in real-time. Many industries employ dynamic pricing models, adjusting prices based on real-time demand fluctuations. Satya Anand, President of Marriott International EMEA, emphasizes the importance of technology in this approach: “Our goal is to ensure that pricing reflects market conditions and customer expectations, utilizing real-time data to adapt dynamically.”
领英推荐
Marketing: Creating Perception and Adding Value.
While strategic analysis provides the data backbone for pricing, marketing plays an essential role in shaping how that price is communicated to customers. Marketing is about creating value perception and ensuring that customers understand the worth behind the price.
or copy paste the url:
from Enzo it's all, over and out ;)