Search results
Results from the WOW.Com Content Network
Value-based price, also called value-optimized pricing or charging what the market will bear, is a market-driven pricing strategy which sets the price of a good or service according to its perceived or estimated value. [1]
Value-based pricing: (also known as image-based pricing) occurs when the company uses prices to signal market value or associates price with the desired value position in the mind of the buyer. The aim of value-based pricing is to reinforce the overall positioning strategy, e.g., premium pricing posture to pursue or maintain a luxury image.
Value-based pricing is a fundamental business activity and is the process of developing product strategies and pricing them properly to establish the product within the market. This is a key concept for a relatively new product within the market, because without the correct price, there would be no sale.
The cumulative monetary value for each element is known as the "total additional value." Add the calculated "total additional value" to the next-best-alternative to determine the EVC. Select what portion of the "total additional value" the company will capture. Note: the remaining value will be passed along to the customer.
Cost-plus pricing is a pricing strategy by which the selling price of a product is determined by adding a specific fixed percentage (a "markup") to the product's unit cost. Essentially, the markup percentage is a method of generating a particular desired rate of return. [1] [2] An alternative pricing method is value-based pricing. [3]
Value Based Pricing. Value-based pricing strategy is founded on a differentiation strategy, and uses buyer’s perceptions of value, which are based on experience. It is customer-driven, and is expressed in terms of setting the highest price possible to the greatest extent that the market will bear.
The assumption underlying PSM is that respondents are capable of envisioning a pricing landscape and that price is an intrinsic measure of value or utility.Participants in a PSM exercise are asked to identify price points at which they can infer a particular value to the product or service under study.
From Wikipedia, the free encyclopedia. Redirect page