BACKGROUND: A year post product launch, a client was questioning if the selected launch price was capable of globally maximizing profit while also driving customer trial and securing retention. They had observed a slower than expected adoption rate, launched in an unexpectedly poor product category economy, and heard customer complaints of high cost. The company hired EC Insights to manage the project and to work with an agreed upon field agency with expertise and respondent access in the product category.
METHODOLOGY: EC Insights led key client discussions to understand product and market background, and clearly define the client’s global pricing objectives. We then conducted global customer interviews followed by an on-line discrete choice model survey in six countries. The findings from this research led to the recommendation to lower the price to encourage customers to complete their trial phase and see product value. A simulator tool was also provided to allow the client to experiment with different scenarios with varying inputs.
RESULTS: The client opted to lower the global price to the recommended level which grew share of market and increased customer retention based on the time to see proven product benefits.
Tags: Strategic PricingView Project