I am a small business owner and get involved in pricing daily. This book provided extremely useful insight into how to make the most money from each deal. An easy read about a topic that is all too often neglected by the small business owner.
This book is essential in discovering perceived value vs. actual value. A great strategy book!
Pricing by value
This book was a delightful read not only because it was short and to the point, but also for it's many real-life examples. I've felt for a long time that prices need to be set to the customer's perception of the value of the product or service, so it was very encouraging to read a book where the author was able to break down the reasons and supply applications for this type of pricing he calls "Value pricing". As with an auction (a theme covered in the book) there is a price for every interested buyer, but it is not always the same for everyone. Just as only one person is willing to pay the highest "winning" bid, there are those who will pay more for any product or service than the average customer. This book helps you to identify those people.
Setting pricing can be a daunting task but Rafi breaks it down into easily understandable chunks of information. Instead of pricing your products and services based on costs, think about the value that it provides to your customer and base your pricing on the Value Decoder that's in this book.
If there is any book you want to read about pricing strategies, this is the book.
Good Solid Advice
The suggestions about add-ons, segmenting your buyers and really trying to assess the value of your product when you price it were helpful. The problem of "goodwill" opened my eyes as I think this isn't an uncommon way that profits are bled from businesses. After reading this book, I'm really thinking more and more about getting to know my customers in terms of (1) what they want and (2) precisely how much they value my product. This is a great first step to obtaining optimal pricing. This book gets you thinking and can stir your creativity about how to better price your good/service.
Want to make a bad year better or turn a good year into a blockbuster? Stop leaking profits and discover the untapped gold mine that exists in your products.
The Art of Pricing is the first practical, easy-to-understand guide to solving one of the most important dilemmas in business: how to use price to uncover a product?s hidden profits and find new opportunities for growth.
When it comes to setting prices for products and services, even the most sophisticated businesspeople often rely on formulas and seat-of-the-pants instinct, based on what the competition is charging, marking up costs, and doing things as they?ve always been done. The result is that businesses of all sizes, from start-ups to the Fortune 100, leave money on the table.
In The Art of Pricing, Rafi Mohammed, one of the world?s leading experts on pricing strategy, shows:
? The astonishing impact that small changes to a pricing strategy can have on the bottom line
? How the right pricing strategy can boost profits and grow your customer base
? Why the right way to think about pricing is as a series of easy-to-implement strategies that allow companies to serve and profit from the largest possible customer base
? Why the art of pricing involves understanding and capitalizing on the fact that different customer segments are willing to pay different prices for the same product
? Why an effective pricing strategy is not about price gouging but one that incorporates fairness into every important pricing decision
The Art of Pricing will be the invaluable missing link for people running companies, departments, divisions, and product lines, as well as for those in sales and marketing. Dr. Mohammed shows that an effective pricing strategy helps complete the circle by reaping the rewards due for the enormous effort, creativity, and investment made in developing and marketing products and services. Using a range of examples, from neighborhood restaurants to huge companies like Ford, he shows the importance of not falling short?and shortchanging yourself?when it comes to the heretofore little understood art of pricing.