Pricing Leadership Navigating through Tumultuous Times October, 2009
This Recession was Different… <ul><ul><li>Deeper Bottom </li></ul></ul><ul><ul><li>Multiple Bubbles </li></ul></ul><ul><ul...
Despite the Emerging Recovery: Pricing will be Tough in the Coming Year A recent survey of CMO’s found that price is the...
The Challenge of the Times… As we focus on recovery, our markets are undergoing massive structural change Copyright © 2009...
 
What is Pricing’s Role in the New World?
In the New Economy: Successful Pricers Will Move… Copyright © 2009 John Hogan Setting prices… $9.99 From: Monetizing th...
Salesforce.com Fueling Growth through their Value Network Founded in 1999, SF has grown to over $1bn in sales through del...
The Revenue Model is Becoming More Complex… <ul><ul><li>Multiple Transaction Types </li></ul></ul><ul><ul><li>Different & ...
In the New Economy: Successful Pricers Will Move… Copyright © 2009 John Hogan Marking up costs… From: Proactively man...
Ingram Micro: Regaining Share from Low Price Competitors Ingram Micro, a leading technology distributor reversed market sh...
The Game Changed with a Low-Price / Low Cost Offer <ul><ul><li>New offering reduced value delivered and cost to serve </...
In the New Economy: Successful Pricers Will Move… Copyright © 2009 John Hogan Measuring the demand curve… From: Mining...
Dow Corning: Creating a New Offering for an Overserved Segment Facing growing share loss in its Silicones business, Dow Co...
Dow Launched a New Brand: Xiameter Since its inception in 2002, Xiameter has grown to account for over 30% of Dow Corning ...
Pricing Leadership Preparing to Win in the New Economy <ul><li>Get your data warehouse in order </li></ul><ul><ul><ul><li>...
Copyright © 2009 John Hogan Thank You! [email_address]
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Pricing Strategy In Tumultuous Times

This is a speech on how macro-economic forces from globalization to new technologies to sustainability are forcing companies to rethink their approach to capturing value.
Published on: Mar 4, 2016
Published in: Business      Technology      
Source: www.slideshare.net


Transcripts - Pricing Strategy In Tumultuous Times

  • 1. Pricing Leadership Navigating through Tumultuous Times October, 2009
  • 2. This Recession was Different… <ul><ul><li>Deeper Bottom </li></ul></ul><ul><ul><li>Multiple Bubbles </li></ul></ul><ul><ul><li>Global Scope </li></ul></ul>Copyright © 2009 John Hogan
  • 3. Despite the Emerging Recovery: Pricing will be Tough in the Coming Year A recent survey of CMO’s found that price is the top concern for customers in the second half of 2009 Source: AMA CMO Survey August 2009 Copyright © 2009 John Hogan
  • 4. The Challenge of the Times… As we focus on recovery, our markets are undergoing massive structural change Copyright © 2009 John Hogan Globalization Shifting Demand Patterns Sustainability Transformative technologies
  • 6. What is Pricing’s Role in the New World?
  • 7. In the New Economy: Successful Pricers Will Move… Copyright © 2009 John Hogan Setting prices… $9.99 From: Monetizing the Value Net… To:
  • 8. Salesforce.com Fueling Growth through their Value Network Founded in 1999, SF has grown to over $1bn in sales through delivery of CRM services to the SMB market <ul><ul><li>Based on Software as Service platform </li></ul></ul><ul><ul><li>Growth fueled by custom apps from independent developers </li></ul></ul>Copyright © 2009 John Hogan
  • 9. The Revenue Model is Becoming More Complex… <ul><ul><li>Multiple Transaction Types </li></ul></ul><ul><ul><li>Different & Complex Value Propositions </li></ul></ul><ul><ul><li>Maintained profits through recession </li></ul></ul>… and More Profitable! Copyright © 2009 John Hogan
  • 10. In the New Economy: Successful Pricers Will Move… Copyright © 2009 John Hogan Marking up costs… From: Proactively managing costs with price… To:
  • 11. Ingram Micro: Regaining Share from Low Price Competitors Ingram Micro, a leading technology distributor reversed market share declines by encouraging customers to engage in lower cost behaviors <ul><ul><li>Losing share to lower price / lower service competitors </li></ul></ul><ul><ul><li>Higher costs from high-touch service model </li></ul></ul><ul><ul><li>Segmented market with high variability in willingness-to-pay </li></ul></ul>Copyright © 2009 John Hogan
  • 12. The Game Changed with a Low-Price / Low Cost Offer <ul><ul><li>New offering reduced value delivered and cost to serve </li></ul></ul><ul><ul><li>Regained share profitably </li></ul></ul><ul><ul><li>Minimized volume and margin loss in high value segments </li></ul></ul>New Service Menu Copyright © 2009 Monitor Company Group, L.P.
  • 13. In the New Economy: Successful Pricers Will Move… Copyright © 2009 John Hogan Measuring the demand curve… From: Mining the demand curve… To:
  • 14. Dow Corning: Creating a New Offering for an Overserved Segment Facing growing share loss in its Silicones business, Dow Corning recognized that it was delivering more value (at higher cost) than customers wanted <ul><ul><li>Increasing price pressure from customers </li></ul></ul><ul><ul><li>Price declines fueled by “low value” competitors </li></ul></ul><ul><ul><li>Experiencing significant share loss </li></ul></ul>Copyright © 2009 John Hogan
  • 15. Dow Launched a New Brand: Xiameter Since its inception in 2002, Xiameter has grown to account for over 30% of Dow Corning Sales. <ul><ul><li>Created value by subtraction </li></ul></ul><ul><ul><li>$70 million investment broke even in 6 months </li></ul></ul><ul><ul><li>Becoming core to Dow Corning business model </li></ul></ul>Copyright © 2009 John Hogan
  • 16. Pricing Leadership Preparing to Win in the New Economy <ul><li>Get your data warehouse in order </li></ul><ul><ul><ul><li>Track purchase trends </li></ul></ul></ul><ul><ul><ul><li>Look at market and company data </li></ul></ul></ul><ul><ul><ul><li>Build analytic capabilities </li></ul></ul></ul><ul><li>Partner with sales and marketing to manage price, value, and cost </li></ul><ul><ul><ul><li>Bring something to the table (e.g., insight or opportunities) </li></ul></ul></ul><ul><ul><ul><li>Build a case for change using data </li></ul></ul></ul><ul><li>Improve efficiency and quality of pricing processes </li></ul>Copyright © 2009 John Hogan
  • 17. Copyright © 2009 John Hogan Thank You! [email_address]

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