PricingBrew

Insights & Tips

Already a subscriber? Login

Become a subscriber and unlock an information arsenal focused on making your pricing efforts more effective.

So, What Is Strategic Pricing…Really?

From job titles to seminar workshops, the term “strategic pricing” seems to get thrown around quite a bit these days. And while putting “strategic” in front of anything certainly makes it sound much more important, what does it actually mean?

Some define strategic pricing as value creation. Some define it as being competitively aware. Still others will use it to describe establishing a company’s price levels and bands. There are a number of definitions and unfortunately, they don’t all agree.

So, we decided to ask the PricingBrew Network for their thoughts on the subject…

But, we didn’t ask them to define the term. Rather, we asked them to describe the differences between strategic and tactical pricing. How are the goals and objectives different? How are the outcomes different? How are the activities different? What is the intent of a strategic pricing person relative to that of a tactical pricing person?

And from their answers, we were able to develop the following definition:

Strategic pricing is about proactively creating the conditions under which better and more-profitable pricing outcomes are the natural result.

Of course, this definition has broad implications…because it goes well-beyond just creating numbers and moving them around. And, it goes well-beyond enforcement and compliance. In fact, this definition encompasses all of the other definitions, from value creation and being competitively aware to establishing price levels and beyond.

To some pricing people, this type of broad definition will be scary. Some people simply prefer to have a more defined “box” within which to operate. And truth be told, some people just prefer to be able to point fingers at other groups when things don’t turn out.

But to other pricing people, this definition will spell opportunity. To them, this definition will be a license…a license to go after anything and everything that ultimately affects the prices a company can command in the marketplace.

So…where do you stand? Are you scared? Or do you relish the opportunity?

Get Immediate Access To Everything In The PricingBrew Journal

Related Resources

  • Are Revenue Management and Pricing Different?

    Some practitioners will use the terms "revenue management" and "pricing" interchangeably. In this expert interview, Amit Aggarwal, the Executive Vice President of Revenue Management at iHeartMedia, helps explain the differences and why they matter.

    View This Interview
  • Managing Your "Minimum Advertised Price"

    Many manufacturers have augmented their channel strategies with MAP (Minimum Advertised Price) policies. While not a panacea, MAP policies can mitigate many channel control and conflict issues. In this guide, we expose 20 strategies and tactics for more effective MAP policies and programs.

    View This Guide
  • Where Should the Pricing Function Be Located?

    Should Pricing report directly to the CEO? Should it be located in Sales, Marketing, Product, or Finance? While none of these organizational locations is perfect, through our research, we've been able to identify and document some of the common pros and cons associated with each location.

    View This Research
  • Generating More Sales from Existing Customers

    Many B2B companies struggle to identify untapped sales opportunities and maximize revenue from the customers they've already acquired. In this four-part recorded training session, learn what leading sales operations are doing differently to grow share-of-wallet with existing customers.

    View This Webinar