introduction to margin squared
TRANSCRIPT
price at the moment of truth
How SME’s can get more from Pricing
An Introduction to Margin2
Copyright Margin2 2011
price at the moment of truth
Companies that execute excellent Price Management practices earn profit margins 24%
more than their competitors*
Most businesses do not exploit the opportunity that price management offers. In our experience, companies base pricing decisions on
– Costs
– Competitor prices
– The belief that discounts are necessary to win business
None of these methods reflect what their customers are willing to pay.
Margin2 can help your business improve your price management by reviewing your performance and actively seeking customer feedback so you can understand what your customers most value and are willing to pay.
We do this by helping you manage your price positioning and analyse your price performance.
Copyright Margin2 2011, * = Source Hogan 2011
Visit us at www.marginsquared.com to find out more
price at the moment of truth
How Margin2 can help you
• Margin2 use a range of tools to help businesses create clear price positions . . . – Pricing Journey Assessments – we identify quick pricing wins and the greatest opportunities to
deliver performance improvements.
– Learning Loops – we identify the features of your product or service most valued by your customers and the optimum price point that reflects your customers willingness to pay.
– New Product Launches – we find the optimum price for a new product by understanding its key value drivers and the willingness to pay of prospective customers.
• . . . and use analytical methods that help businesses unlock the power of price management.
– Price Optimiser – We use historical sales data to calculate the optimum price for a given product or service, for a given customer, for a given point in time.
– Conjoint Analysis – We help businesses identify the product or service features that customers most value so they can design product offerings that maximise the customers willingness to pay.
Copyright Margin2 2011, * = Source Hogan 2011
Visit us at www.marginsquared.com to find out more
price at the moment of truth
£0.00
£5,000.00
£10,000.00
£15,000.00
£20,000.00
£25,000.00
Total
Source of Revenue Growth P2 & P3
Volume Effect P2 Volume Effect P3
Price Effect P2 Price Effect P3
What Margin2 can Deliver - Case Study for Vehicle Leasing
Margin2 was asked by a Top 20 UK Vehicle Leasing company to recommend adjustments to customer quotations to either increase margin or win incremental volume.
Margin2 analysed 1587 quotes, for 43.5% we quoted higher prices and for 19% we reduced the quote.
As a result, when prices were increased by 2.8%, our client still saw Quote acceptance grow from 7.2% to 16.4%.
Copyright Margin2 2011
Visit us at www.marginsquared.com to find out more