Pricing is ... Important

I'm almost embarrassed to state this, it's so obvious.  More interesting though, pricing is important to almost everyone in the company.  New product development creates new products, and they want them to be very successful.  Price too high and not enough are sold.  Price too low and the new product isn't as profitable as it could be.  Their success depends on good pricing. Marketing is measured on the success of demand generation.  Prices that are too high greatly hinder customer demand.  Prices that are too low may make the product look cheap. Sales departments live and die by proper pricing.  They are trained to sell the value of their products, but if the prices are too high even the best sales person will not succeed. The CFO is the protector of the company profit.  She is almost always worried that prices are too low, the company is giving too many discounts, sacrificing unnecessary profit. The ultimate individual responsible for profit is the CEO.  He sets the strategy.  He determines the general price positioning of the company.  He clearly sees the tradeoff between high and low prices and is looking for that perfect price level to maximize company profits. Pricing drives the success or failure for many people within a company.  This is why so many people find pricing so important.  This is also why it's difficult in big companies to get consensus on changing pricing processes.  Someone with power will always be against the proposed change. Pricing is important ... to everyone.
Mark Stiving

Mark Stiving

Mark Stiving is chief pricing educator with Impact Pricing LLC. Connect with him on LinkedIn

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