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Category: Pricing Strategy

For a pricing strategy, it is best to think of pricing as one of the tools a company uses to achieves its strategy and how this tool is used changes as the use of the other tools change. Therefore, a pricing strategy should be set to help a company achieve its overall strategy. Rather than memorizing all the different pricing strategies, and there are a lot of them, it is best to develop a pricing strategy from first principles.

Think of the cost price of a product/service as the floor and the maximum price the market can accept, is the ceiling price t. Above the floor is the lowest price of a competitor and/or substitute. Pricing below the floor means selling at a loss. Going up from the lowest price of a competitor and/or substitute, we come to the maximum price of a competitor and/or substitute. There will be many competitor/substitute prices and they can plotted here. Assuming you have the higher price, going up you come to the ceiling. You can also price above the ceiling.

Within those ranges are the price points one can take. Choosing which range to price at is driven by the company strategy, and not by the pricing strategy. For example, if the goal is to price below cost to steal market share, serve as a loss leader and make a competitor’s profit engine obsolete, then prices should be set just above or even below cost price. That is pricing strategy: using pricing as a tool to help the overall company achieve its goal.

Competitive Advantage: Does LAB compete on risk or price?

Competitive Advantage: Does LAB compete on risk or price?

A bank can only build its competitive advantage on one of these levers. Read more…

  • February 3, 2019

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Greetings from the Editor

My name is Kris Safarova and I am the editor of StrategyJournal.com. I also run StrategyTraining.com, StrategyBooks.com, StrategyTV.com and Firmsconsulting.com. In addition I run two podcasts routinely ranked in the Top 10 for careers worldwide: Strategy Skills and Case Interviews & Management Consulting.

I work with ex-BCG, McKinsey et al senior partners to produce all the content on the sites above. I curate and distill their ideas through books, videos, documentaries, apps, podcasts and other bespoke programming streamed 24/7 in >150 countries around the world that teach our clients to solve mankind’s  toughest problems. Our free episodes have been downloaded >2 million times. Our subscription-only content has much higher engagement. In total I have worked with these partners to produce >35 training programs about strategy. That’s >4,000 episodes of content and over 900 hours of subscription-only programming. 

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While I am proud of all the work, I am particularly fond of the 3-year journey to produce The Bill Matassoni Show documentary series and Bill’s memoir Marketing Saves the World. Bill was McKinsey’s first marketing director, and a mentee and close friend of Marvin Bower. We also produced a set of unique Apps, a unique limited edition Glass House memoir and a very effective social media campaign to launch the book which went to #1 on Amazon in its category and #9 on WSJ. I really enjoyed working with Bill and his lovely wife Pamela.

Our goal is to teach complex problem skills through engaging, entertaining and realistic settings: From restructuring a national power utility to building an electric car start-up to building the innovation division at a global professional services firm to building profitable banking products for the unbanked, and more. Motivated and armed with our detailed content and focus on ethical leadership, our clients are tackling problems that matter to the world. The articles here are adapted from the advanced and in-depth content that the partners produce. I edit all the articles and also write a few myself. 

If you would like updates on the programs we produce and our weekly episode releases, please opt-in to the email list above. In my prior life I was a consultant, banker, master pianist and fledgling recorded pop singer. I hold a Richard Ivey MBA and UNISA B.Comm along with a DG Shatalov Music Diploma.

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