How to Calculate The Right Price For Your Product or Service

If you are working on a business plan for the launch or re-launch of a product on the market, but also if you are simply carrying out an analysis of a customer’s product portfolio or an assessment of real/perceived positioning, you will certainly have faced the price issue.

All quite common and shared questions when you are with a strategic marketing project, if you are working on a new product that doesn’t even exist on the market yet, then things get even more

In my personal experience, the difficulty alsoprocess Phone Number List will lies in the fact that there are very few doctrines on the subject and practical cases to take as examples. Hence the idea of ​​sharing my personal experience, hoping to bring a real benefit to most and collect comments from those who want to give me feedback.

 

Pricing methods

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Price is the only element of the marketing mix that proues, the other elements only involve costs; yet there are few companies that adopt scientific methods of price determination, taking into account corporate objectives and positioning. The reality is that very often, caught up in the rush to place the product on the market, a poorly reasoned price isdefined with the excuse that it can always be recalibrated at a later time. When, on the other hand, the price we choose for our product is a strong stance and any future change generates conflicting messages towards the reference market, damaging the company’s image and sales.

Theory teaches us that the price is the son of the company strategy, therefore

 

  • fixed markup: I determine the price by applying a pre-set markup;
  • breakeven or target result: I determine the price according toertain expected profit or simply with the aim of going to breakeven;
  • benchmarking : I determine the price according to the competitors’ market prices; higher, lower or equal, then, depending on the strategic positi notum  Frist Database priceoning that I have decided for my product;

 

But this is not enough, the point of view of the market is missing. I might discover that my potential customer is willing to pay even more (or less) than the estimated price, but here the .

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