The Strategy and Tactics of Pricing, 7th Edition

Table of contents

1. Cover
2. Endorsement Page
3. Half Title
4. Title Page
5. Copyright Page
6. Table of Contents
7. Preface
8. Acknowledgments
9. List of In-Line Boxes
10. List of Exhibits
11. Chapter 1 Strategic Pricing
    1. Coordinating the Drivers of Profitability
    2. Leveraging Profit into Sustainable Growth
    3. Cost-Plus Pricing
    4. Customer-Driven Pricing
    5. Share-Driven Pricing
    6. The Role of “Optimizing” in Strategic Pricing
    7. What Is Strategic Pricing?
    8. Value Creation
    9. Value Communication
    10. Price Structure
    11. Pricing Policy
    12. Price Competition
    13. Price Setting
    14. Creating a Strategic Pricing Capability
    15. Summary
    16. Notes
12. Chapter 2 Economic Value
    1. The Guiding Force of Pricing Strategy
    2. The Role of Value in Pricing
    3. How to Estimate Economic Value
       1. Competitive Reference Prices
       2. Estimating Monetary Value
       3. Monetary Value Estimation: An Illustration
       4. Estimating Psychological Value
       5. Psychological Value Estimation: An Illustration
       6. The High Cost of Shortcuts
    4. Value-Based Market Segmentation
       1. Step 1: Determine Basic Segmentation Criteria
       2. Step 2: Identify Discriminating Value Drivers
       3. Step 3: Determine Your Operational Constraints and Advantages
       4. Step 4: Create Primary and Secondary Segments
       5. Step 5: Create Detailed Segment Descriptions
       6. Step 6: Develop Segment Metrics and Fences
    5. Summary
    6. Notes
13. Chapter 3 Price and Value Communication
    1. Strategies to Influence Willingness to Pay
    2. Value Communication
    3. Adapting the Message for Product Characteristics
       1. Low-Involvement Products with Psychological Benefits
       2. Low-Involvement Products with Economic Benefits
       3. High Involvement, Psychological Benefits
       4. High Involvement, Economic Benefits
    4. Strategies for Conveying Value
       1. Competitive Reference Effect
       2. Extremeness Aversion
       3. Switching Cost Effect
       4. Difficult Comparison Effect
       5. End-Benefit Effect
       6. Price-Quality Effect
       7. Expenditure Effect
       8. Shared Cost Effect
       9. Fairness Effect
    5. Multiple Participants in the Buying Process
       1. Transactional Value
    6. Summary
    7. Notes
14. Chapter 4 Price Structure
    1. Tactics for Pricing Differently across Customer Segments
    2. Challenges That Can Undermine Segmented Pricing
    3. Offer Configurations
       1. Optimizing the Structure of Offer Bundles
       2. Designing Segment-Specific Bundles
       3. Unbundling Strategically
    4. Price Metrics
       1. Creating Good Price Metrics
       2. Performance-Based Metrics
       3. Tie-Ins as Metrics
    5. Price Fences
       1. Buyer Identification Fences
       2. Purchase Location Fences
       3. Time of Purchase Fences
       4. Purchase Quantity Fences
    6. Dynamic Pricing and Yield Management
    7. Summary
    8. Notes
15. Chapter 5 Pricing Policy
    1. Influencing Customer Expectations and Purchase Behaviors
    2. Pricing Policies and Price Expectations
    3. The Emergence of Strategic Sourcing
    4. Policies for Price Negotiation
    5. Policies for Responding to Price Objections
       1. The Problem with Reactive, Ad Hoc Price Negotiation
       2. The Benefits of Proactive, Policy-based Price Negotiation
       3. Policies for Different Buyer Types
       4. Policies for Dealing with Power Buyers
    6. Policies for Successfully Managing Price Increases
       1. Policies for Leading an Industry-Wide Increase
       2. Policies for Transitioning from “Flexible” to “Policy-Based” Pricing
    7. Policies for Pricing in an Economic Downturn
    8. Policies for Promotional Pricing
    9. Summary
    10. Notes
16. Chapter 6 Price Competition
    1. Managing Conflict Thoughtfully
    2. Understanding the Pricing Game
    3. Competing To Grow Profitably
    4. Reacting To Competition: Think Before You Act
       1. Is There a Response That Would Cost Less Than the Preventable Sales Loss?
       2. If You Respond, Is Your Competitor Willing and Able to Cut Price Again to Reestablish the Price Difference?
       3. Will the Multiple Responses Required to Match a Competitor Cost Less Than the Avoidable Sales Loss?
       4. Is Your Position in Other (Geographic or Product) Markets at Risk If a Competitor Is Successful in Gaining Share?
       5. Does the Value of the Markets at Risk Justify the Cost of Response?
    5. Managing Competitive Information
    6. Collect and Evaluate Competitive Information
       1. Selectively Communicate Information
    7. When Should You Ever Compete On Price?
    8. Summary
    9. Notes
17. Chapter 7 Price Level
    1. Setting the Prices That Capture a Share of the Value Created
    2. The Price-Setting Process
       1. Step 1: Define the Viable Price Range
       2. Step 2: Make Strategic Choices
    3. Option 1: Skim the Market
    4. Option 2: Penetrate the Market
    5. Option 3: Neutral Market Pricing
       1. Step 3: Assess Break-Even Sales Changes
    6. Break-even Sales Change Calculation
       1. Step 4: Gauge Price Elasticity
       2. Step 5: Account for Psychological Factors
    7. Communicating New Prices to the Market
    8. Summary
    9. Notes
18. Chapter 8 Measurement of Price Sensitivity
    1. Research Techniques to Supplement Judgment
    2. Types of Measurement Procedures
       1. Uncontrolled Studies of Actual Purchases
       2. Historical Sales Data
       3. Panel Data
       4. Store-Level Transaction Data
       5. Analyzing Historical Data
    3. Experimentally Controlled Studies of Actual Purchases
       1. In-Store Purchase Experiments
       2. Laboratory Purchase Experiments
    4. Uncontrolled Studies of Preferences and Intentions
       1. Direct Questioning
       2. Buy-Response Surveys
       3. Attribute Rating
       4. In-Depth Interviews
    5. Experimentally Controlled Studies of Preferences and Intentions
       1. Simulated Purchase Experiments
       2. Trade-off (Conjoint) Analysis
    6. Using Measurement Techniques Appropriately
       1. Using Judgment for Better Measurement
       2. Using Online and Mobile Techniques
       3. Outside Sources of Data
       4. Selecting the Appropriate Measurement Technique
    7. Summary
    8. Notes
19. Chapter 9 Financial Analysis
    1. Analyzing Costs and Profits for Pricing
    2. Evaluating the Financial Implications of Price Alternatives
    3. Why Incremental Costs?
    4. Why Focus on Avoidable Costs?
    5. Understanding the Financial Implications of Alternative Price Levels
       1. Evaluating the Potential Profitability of a Price Change
    6. Break-Even Sales Incorporating a Change in Variable Costs
    7. Break-Even Sales Analysis for Reactive Pricing
    8. Mapping a Range of Potential Financial Outcomes
    9. Break-Even Sales Curves
    10. Watching Your Baseline
    11. Covering Non-Incremental Fixed and Sunk Costs
    12. Summary
    13. Notes
    14. Appendix 9A
    15. Case Study
    16. Appendix 9B
    17. Derivation of the Break-Even Formula
20. Chapter 10 Specialized Strategies
    1. Adapting Pricing to Accommodate Common Challenges
    2. Adapting Pricing Strategy Over the Category Life Cycle
       1. Pricing an Innovation
       2. Price Reductions in Growth
       3. Pricing the Established Product in Maturity
    3. Managing Export Prices in Foreign Currencies
       1. Foreign Market Sales Strategy
       2. Competitive Impact of Exchange Rate Shifts
       3. Four Generic Strategies for Managing Exchange Rate Price Adjustments
    4. Navigating Grey Markets and Parallel Imports
    5. Managing Pricing Under Duress—Inflation, Pandemics, Recessions
    6. Creating Economically Efficient Transfer Prices
    7. Summary
    8. Notes
21. Chapter 11 Creating a Strategic Pricing Capability
    1. Assembling Talent, Processes, and Data to Build Competitive Advantage
    2. Essential Elements of the Pricing Organization
       1. Creating Alignment on Pricing Objectives
       2. Matching the Extent of Pricing Centralization with Organizational Needs
       3. Decision Rights Specify Pricing Roles and Responsibilities
       4. Pricing Processes to Ensure Strategy Implementation
       5. Performance Measures and Incentives: Aligning Sales Incentives with Strategy
    3. Systems to Support the Pricing Function
       1. Data Needed to Inform the Pricing Function
       2. Common Protocols for Creating Relevant Insights
       3. Customer Analytics to Guide Management Choices
       4. Analysis of Win–Loss Data
       5. Customer Profitability and Cost-to-Serve
       6. Process Management Analytics
       7. Price Bands
       8. Price Waterfalls
       9. Pricing Systems
    4. Managing the Organizational Change Process
       1. Senior Management Leadership
       2. Demonstration Projects
    5. Summary
    6. Notes
22. Chapter 12 Ethics and the Law
    1. Understanding the Constraints on Pricing
    2. The Legal Framework for Pricing
    3. Price Fixing or Price Encouragement
       1. Horizontal Price Fixing
    4. Resale Price Fixing or Encouragement
       1. Vertical Price Fixing
       2. Direct Dealing Programs
       3. Resale Price Encouragement
    5. Price and Promotional Discrimination
       1. Price Discrimination
       2. Defenses to Price Discrimination
       3. Promotional Discrimination
       4. Competitive Injury, Defenses, and Indirect Purchasers
    6. Using Nonprice Variables to Support Pricing Goals
       1. Vertical Nonprice Restrictions
       2. Nonprice Incentives
    7. Other Pricing Issues
       1. Predatory Pricing
       2. Price Signaling
       3. Most-Favored-Nation Clauses
    8. Summary
    9. Notes
23. Index