Deloitte's Pricing and Profitability Management practice helps organizations address the spectrum of commercial pricing strategies, processes, and capabilities to align them with business, marketing, customer segmentation, and channel strategies. Starting with the drivers of customer value and layering on transaction-level analysis and insight, we help companies break down their business so they can see its many parts, identify the economic value of each product and customer, and devise ways to communicate and deliver that value to customers at prices that meet both customer expectations and profit objectives.
In a rapidly changing world, the enduring problem of balancing price and profit becomes ever more complex. With new competitive entrants and slow economic growth on the one hand, and changing customer needs on the other, profit margins can come under pressure. But how can you charge the right amount for different products and services, and how can you adjust pricing according to different customer needs and experiences? To what extent are your promotional efforts effective, and what seasonal pricing strategy should you adhere to? And what does this mean for customer retention?
At Monitor Deloitte, we understand the intricacies of pricing and apply an analytical approach to help companies:
- Bring insights into customer behaviour - what customers value and what they are willing to pay;
- Find the optimum pricing portfolio for different services, products and customer segments;
- Show you (seasonal) fluctuations in value, helping you decide when to push your promotions;
- Bring insight into the different channels and communication ways to which your customers are most receptive to promotional offerings;
- Identify appropriate pricing contract structures
We use more than 20 diagnostic tools, including “big data”, to reveal the size and nature of pricing opportunities. This brings you the following concrete results:
- Identification of quick wins (typically 1 to 3 percent of revenue within three to six months);
- Assessment of the linkage between cost-to-serve and pricing levels;
- Implementation of processes, policies and organizational designs in line with revenue and profit growth objectives;
- Development of sales-ready content and selling tools that help sales forces have effective, value-based discussion;
- Redesign of business model to address the needs of a rapidly changing marketplace