For many brands, important cost components will continue to erode the bottom line in 2023. With most brands taking some price increases in 2021-2022, signs of softening demand may be a looming reality for a variety of industries, brands, and sections of any given brand’s markets. What should companies do to combat these economic factors? In this article, the author looks in some detail at three pricing power moves that illustrate that consumer brands always have additional pricing power to find, nurture, and harvest.
BCG Executive Perspectives offer insights on global topics that matter most to leaders in the public and private sectors. This edition delves into the different ways the pandemic is affecting consumption habits and what this means for companies trying to keep up. Although not pricing specific, this article presents key insights for pricers working to develop effective post-COVID pricing strategies.
With wide-scale vaccine rollouts well underway, our entry into a post-pandemic world is already a reality for some and an inevitability for others. Those within the experience economy who establish strong pricing strategies by capitalizing on their pricing power, gaining consumer confidence, considering consumer behavior, and identifying value drivers will maximize profits, overcome pandemic-related losses, and set the groundwork for long-term success. One thing is for sure – there’s no time to lose, as the author explains.
This case study outlines a pricing transformation project that provided $3 million in short-term pricing opportunities and $10 million in long-term margin improvement opportunities. The project realized these outcomes by harnessing consumer pricing research to determine if different customer segments shopped using specific retail channels, and if so, which products should be offered through each retail channel, and at what price.
In this article, the authors examine three types of sympathetic pricing - painkiller pricing, compassionate pricing and purposeful pricing – and demonstrate how companies have used these pricing tactics to increase both brand trust and brand loyalty. By applying sympathetic pricing, you can turn a negative experience for a customer into a positive one, thereby giving the customer a positive contact moment with your company, as the authors explain.
Which price and price differences can Consumer Packaged Goods (CPG) companies actually control, and what does the report of higher prices really mean? In this article, the author will explore how much control CPG companies actually have over their prices, which prices they should attempt to manage, and best practices for successfully executing these strategies.
Bait-and-surcharge pricing, marketing an attractive price to gain consumer interest and adding mandatory fees at the time of purchase, is becoming the norm in many industries. In this article, the author explores this tactic and why it is unethical, but also why it is difficult for companies to abandon due to the effects it has on market competition and customer perception.