Pricing Research Audit

Many managers and executives are uncertain about their pricing. They ask themselves questions like the following:

  • Are we leaving money on the table?

  • Can we "take price" and substantially increase our profits?

  • What price is the best to gain market share without totally killing our profits?

  • What is the "right" price for our new product or service?

  • If we increase the price, will we lose our best customers? Will we see an immediate drop in sales and tarnish our brand? Will customers flee to the competition? 

These questions (and more) can be answered with pricing research; rigorous, scientific, statistically valid online market research into your market to measure willingness to pay. Here are some things to consider when conducting survey-based pricing research:

  • It needs to target the entire addressable market, including some of your customers and those that are not. It is from non-customers that most of your growth will come from. 

  • Qualification of respondents is critical. This can be done by disqualifying those who cannot prove they have specific knowledge of the kind of product or service or specific needs your product or service solves. 

  • Statistical significance needs to be obtained. This typically means a minimum of 96 respondents for each answer alternative. 

  • The method to measure willingness to pay must be proven accurate and dependable. 

But like any journey, it starts with understanding the current situation. The short audit to the left will give you some hints about where you are on that pricing research journey.