Estimating the Price of Your New Products

How do you Estimate the price of new product and services? The truth is that very few businesses have a process in place to set and manage pricing.

To be able to calculate your prices, you must start by UNDERSTANDING how much value your products and services create for your customers. So many people talk about value, but few actually know how to estimate and measure value.

Having said that, this year, we have seen a marked shift in the type of projects that our clients want to work on. Last year was about price management and margin improvement, but this year is about value creation and developing a process to value price new products. Businesses are recognising that they need to QUANTIFY in monetary and emotional terms the value that they create for their customers and that is exactly what we are doing together.

The ECONOMIC VALUE ESTIMATION model is a robust framework that enables you to estimate and quantify the differential value created for your customers compared to the next best competitive alternative.

Understanding value created by a product requires intimate knowledge of your customers’ needs as well as a good understanding of the unique value delivered by competitive alternatives.

This approach completely changes the game.

Change is happening in many businesses and you don’t want to be left behind selling on price.