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Why You May Not Have a Pricing Problem

In The Anatomy of a Successful B2B Pricing Analyst, participants highlighted “diagnostic thinking” as being one of the most important abilities for a B2B pricing analyst to develop or possess. Here’s how it’s described in the guide:

Diagnostic Thinking—The willingness and ability to get beyond the obvious causes of pricing outliers and poor performance, and investigate, identify, and correct the underlying or systemic root-causes.

Why is this ability so important? Because pricing problems in B2B environments are very often just the most obvious symptoms of problems or deficiencies somewhere else. And with pricing, whenever you address the symptoms rather than the true root-causes, a few things will happen:

  • As the underlying problem is still alive and well, the symptoms will come back again and again, and you’ll never really be rid of them.
  • The actions you take to “fix” the symptom will have unintended consequences that can actually make the issues worse and not better.
  • You propagate and reinforce the misguided notion that every problem experienced in the marketplace can be blamed on pricing.

But identifying the real root-causes and underlying factors behind supposed pricing problems is not always easy. And the investigations can often take circuitous paths.

To better understand some of the “hidden” root-causes that other pricing teams have identified, and how they went about investigating the issues, we asked members of the PricingBrew Network to share their most illustrative cases.

Seven of these investigations are detailed in Exploring the Root-Causes of Pricing Problems, and each case includes the originating symptoms, the investigation process, the findings, the diagnosis, and the ultimate solution or resolution.

In one case, an “obvious” issue with pricing compliance turned out to be a forecasting problem. In another instance, a “clear” case of unprofitable pricing was found to have its roots in inaccurate product costing. And in yet another example, where prices were “definitely” too high, the real problem was traced to a poorly designed website!

While these seven cases certainly make for an interesting and educational read, the overarching message is clear. To really be effective, pricing analysts do indeed need to be able to dig deeper and get beyond the obvious conclusions—because the obvious conclusions are very often wrong.

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