If your pricing strategy is more than a few months old, it’s already obsolete. Companies are struggling to hold on as the roller coaster economy heads south. Consider how the current downturn is affecting the three primary drivers of pricing decisions:
- Willingness to Spend. Consumers across all income segments will be looking for ways not to spend as they struggle to stay afloat in tough times.
- Competitors’ Prices. Pressured by decreasing demand and consumers’ price sensitivity, competitors will be tempted to lower prices and wage price wars.
- Company Economics. Volatility in commodity costs and uncertainty about volume will continue to disrupt supply chain costs.
In the face of such challenges, strategic pricing can get your company heading back up—even when your competitors are going down. It can combat extreme price sensitivity with lower perceived prices, manage the risk of price wars, and mobilize the organization to respond rapidly to price changes.