Pricing Wiki - User contributions [en]

Switching costs

2013-01-10T09:29:16Z

Professional Pricing Society:

'''Switching costs''' (or barriers) refers to any product-specific psychological or financial investment that a customer makes in a firm’s product that they have purchased in the past which reduces their willingness to select an alternative firm’s products.

[[Category:Concept]]

Promotional pricing

2013-01-10T09:27:29Z

Professional Pricing Society:

'''Promotional pricing''' is a form of price segmentation in which the price is temporarily lowered to encourage customer purchase. There are many examples of '''promotional pricing''' including approaches such as BOGOF (Buy One Get One Free).

[[Category:Strategy]]

Price waterfall

2013-01-10T09:26:12Z

Professional Pricing Society: Created page with "The '''price waterfall''' is graphical depiction of the types and depths of different forms of discounts provided to the market by the firm, from list price to ..."

The '''price waterfall''' is graphical depiction of the types and depths of different forms of discounts provided to the market by the firm, from [[List price|list price]] to [[Invoice price|invoice price]] to [[Net price|net price]].

[[Category:Indicator]]

Price discrimination

2013-01-10T09:24:31Z

Professional Pricing Society:

'''Price discrimination''' occurs when identical goods or services are transacted at a different price from the same supplier. The term discrimination is not intended to represent unfair or illegal behavior.

== See also ==
[[Price segmentation]]

[[Category:Method]]

Penetration pricing

2013-01-10T09:21:50Z

Professional Pricing Society:

'''Penetration pricing''' is the practice of pricing a new product/service artificially low in order to gain market share.

Net price

2013-01-10T09:20:48Z

Professional Pricing Society:

The '''net price''' (aka [[Pocket price]]) is the [[Price|price]] paid by customers after accounting for both on- and off-invoice discounts (services and activities such as payment terms discounts, annual volume rebates, covered freight and others).

[[Category:Indicator]]

Exchange value

2013-01-10T09:20:04Z

Professional Pricing Society:

'''Exchange value''' is the cost of the customer’s best alternative plus the value of whatever differentiates the offering from the next best alternative.

Basically it is the sum of the price of comparable alternative and its differential value. '''Exchange value''' and its derivation through an [[Exchange value model|exchange value model]] may also be refered as economic exchange value, exchange value analysis, economic value analysis, financial impact value, business impact model, financial value calculator, and many other names.

[[Category:Value Based]]

Conjoint analysis

2013-01-10T09:17:56Z

Professional Pricing Society:

'''Conjoint analysis''' is a market research method of defining the price of a product or service that relies upon respondents making tradeoffs between potential offers to reveal their preferences.

It provides a quantitative estimate of the contribution that each attribute makes to the purchase decision by varying them over as many levels as is reasonable. This analysis reveals the relative importance of [[Price|price]] to other attributes and provides a measure of the sensitivity to each attribute (which can help estimate price elasticity).

[[Category:Model]]

SaaS

2013-01-10T09:16:30Z

Professional Pricing Society:

'''SaaS''' stands for [[Software as a Service]].

SaaS

2013-01-10T09:16:19Z

Professional Pricing Society: Created page with "'''Saas''' stands for Software as a Service."

'''Saas''' stands for [[Software as a Service]].

Reference price

2013-01-10T09:15:47Z

Professional Pricing Society: Created page with "The '''reference price''' is any price which the customer may have expected to pay for an offering, including the price they last paid or the price of a competitive alternative."

The '''reference price''' is any price which the customer may have expected to pay for an offering, including the price they last paid or the price of a competitive alternative.

Milk pricing

2013-01-10T09:15:10Z

Professional Pricing Society: Created page with "See Signpost pricing"

See [[Signpost pricing]]

Loss-leader pricing

2013-01-10T09:14:18Z

Professional Pricing Society: Created page with "See Signpost pricing"

See [[Signpost pricing]]

Economically-normal good

2013-01-10T09:12:27Z

Professional Pricing Society: Created page with "An '''economically-normal good''' is one for which the quantity demanded decreases as price increases."

An '''economically-normal good''' is one for which the quantity demanded decreases as price increases.

EVM

2013-01-10T09:11:40Z

Professional Pricing Society: Created page with "'''EVM''' stands for Exchange Value Model."

'''EVM''' stands for [[Exchange value model|Exchange Value Model]].

Commodity market

2013-01-10T09:10:44Z

Professional Pricing Society: Created page with "See Perfect competition."

See [[Perfect competition]].

Cross-price elasticity of demand

2013-01-10T09:08:53Z

Professional Pricing Society:

'''Cross-price elasticity of demand''' measures the responsiveness of demand a product has to a change in the [[Price|price]] of another product. If elasticity is negative then the products are complementary, and if it is positive they are [[Substitutes|substitutes]].

[[Category:Demand Model]]

BISR

2013-01-10T08:59:05Z

Professional Pricing Society: Created page with "'''BISR''' stands for Breakeven Incremental Unit Sales-per-Redemption. Category:Acronym"

'''BISR''' stands for [[Breakeven incremental unit sales-per-redemption|Breakeven Incremental Unit Sales-per-Redemption]].

[[Category:Acronym]]

Second-degree price discrimination

2013-01-09T17:08:04Z

Professional Pricing Society:

'''Second-degree price discrimination''' is the action of charging individual customers differently according to the quantity purchased.

== See also ==
*[[First-degree price discrimination]]
*[[Third-degree price discrimination]]

First-degree price discrimination

2013-01-09T17:07:36Z

Professional Pricing Society:

'''First-degree price discrimination''' consists in charging every customer the price that matches their [[Willingness to pay|willingness to pay]]. Also known as [[Complete price discrimination|complete price discrimination]].

== See also ==
*[[Second-degree price discrimination]]
*[[Third-degree price discrimination]]

Third-degree price discrimination

2013-01-09T17:06:38Z

Professional Pricing Society:

A '''third-degree price discrimination''' is the action of charging separate [[Customer segment|customer segments]] different prices where the [[Segmentation hedge|segmentation hedges]] can be derived from different attributes, features, or benefits associated with the offer, or from attributes of the customer themselves.

== See also ==
*[[First-degree price discrimination]]
*[[Second-degree price discrimination]]

Zone of indifference

2013-01-09T16:52:38Z

Professional Pricing Society: Created page with "The '''zone of indifference''' is the area around the value equivalence line at which small changes in price or benefits are associated with no subs..."

The '''zone of indifference''' is the area around the [[Value equivalence line|value equivalence line]] at which small changes in price or benefits are associated with no substantial change in quantity sold or have inconsequential impact on the perceived relative value of the offerings.

Yield management

2013-01-09T16:50:51Z

Professional Pricing Society:

'''Yield management''' (or [[Revenue management]]) is a [[Price structure|price structure]] in which the price of the good increases as the time to purchase approaches the time of use. '''Yield management''' has been recommended for goods in which capacity is limited and perishable, customers can reserve units of capacity in advance, and the firm is able to sell the same capacity at different prices.

Yield management

2013-01-09T16:50:04Z

Professional Pricing Society: Created page with "'''Yield management''' is a price structure in which the price of the good increases as the time to purchase approaches the time of use. '''Yield managemen..."

'''Yield management''' is a [[Price structure|price structure]] in which the price of the good increases as the time to purchase approaches the time of use. '''Yield management''' has been recommended for goods in which capacity is limited and perishable, customers can reserve units of capacity in advance, and the firm is able to sell the same capacity at different prices.

Volume hurdle

2013-01-09T16:47:17Z

Professional Pricing Society:

In conducting a [[Profit sensitivity analysis|profit sensitivity analysis]] of a price decrease, the '''volume hurdle''' defines the minimum required volume increase for a price decrease to improve the [[Profit equation of the firm|firm’s profits]].

Volume hurdle

2013-01-09T16:46:55Z

Professional Pricing Society: Created page with "In conducting a Profit sensitivity analysis of a price decrease, the '''volume hurdle''' defines the minimum required volume increase for a price decrease to improve the [..."

In conducting a [[Profit sensitivity analysis]] of a price decrease, the '''volume hurdle''' defines the minimum required volume increase for a price decrease to improve the [[Profit equation of the firm|firm’s profits]].

Vertical price fixing

2013-01-09T16:43:09Z

Professional Pricing Society: Created page with "'''Vertical price fixing''' refers to price agreements between firms at different points in the value chain."

'''Vertical price fixing''' refers to price agreements between firms at different points in the [[Value chain|value chain]].

Versioning

2013-01-09T16:41:29Z

Professional Pricing Society: Created page with "See Tiered price structure."

See [[Tiered price structure]].

Value-disadvantaged

2013-01-09T16:39:24Z

Professional Pricing Society: Created page with "We talk about '''value-disadvantaged''' product or service when it offers fewer benefits than the price extracted relative to its competitive alternatives. In a [[Price-to-ben..."

We talk about '''value-disadvantaged''' product or service when it offers fewer benefits than the price extracted relative to its competitive alternatives. In a [[Price-to-benefits map|price-to-benefits map]] (or [[Value map]]), '''value-disadvantaged''' products would be positioned above the zone of indifference.

Value-advantaged

2013-01-09T16:37:50Z

Professional Pricing Society:

We talk about '''value-advantaged''' product or service when it offers more benefits than the price extracted, relative to its competitive alternatives. In a [[Price-to-benefits map|price-to-benefits map]] (or [[Value map]], '''value-advantaged''' products would be positioned below the zone of indifference.

== See also ==
[[Value-disadvantaged]]

Value-advantaged

2013-01-09T16:37:42Z

Professional Pricing Society:

Value-advantaged

2013-01-09T16:36:45Z

Professional Pricing Society: Created page with "We talk about '''value-advantaged''' product or service when it offers more benefits than the price extracted, relative to its competitive alternatives. In a [[Price-to-benefi..."

Unharvested value

2013-01-09T16:34:03Z

Professional Pricing Society:

We talk about '''unharvested value''' when positioning an offering [[Value-advantaged|value-advantaged]] when evidence demonstrates that the firm could raise its price without effect on the sales quantity demanded.

Value equivalence line

2013-01-09T16:29:58Z

Professional Pricing Society: Created page with "On a price-to-benefits map (or Value map), the '''value equivalence line''' is defined by products which offer improvements in benefits commensur..."

On a [[Price-to-benefits map|price-to-benefits map]] (or [[Value map]]), the '''value equivalence line''' is defined by products which offer improvements in benefits commensurate with an increase in price.

Unharvested value

2013-01-09T16:23:06Z

Professional Pricing Society: Created page with "We talk about '''unharvested value''' when positioning an offering value-advantaged when evidence demonstrates that the firm could raise its price without effect on the sales ..."

We talk about '''unharvested value''' when positioning an offering value-advantaged when evidence demonstrates that the firm could raise its price without effect on the sales quantity demanded.

Tying arrangement

2013-01-09T16:20:42Z

Professional Pricing Society: Created page with "A '''tying arrangement''' is a price structure in which a customer must buy both the durable and the consumable parts of the offer in order to derive value..."

A '''tying arrangement''' is a [[Price structure|price structure]] in which a customer must buy both the durable and the consumable parts of the offer in order to derive value. The durable part of the offer will be priced relatively low to encourage purchase while the consumable part will be priced relatively high to extract value from customers. Under certain circumstances, '''tying arrangements''' are illegal. Contrast with [[Two-part tariff|Two-part tariff]].

Inclined tariff

2013-01-09T16:15:15Z

Professional Pricing Society:

An '''inclined tariff''' is a [[Two-part tariff|two-part tariff]] in which the [[Metered fee|metered fee]] is reduced for customers with a lower consumption.

Block tariff

2013-01-09T16:14:02Z

Professional Pricing Society:

A [[Two-part tariff|two-part tariff]] in which the [[Metered fee|metered fee]] is reduced for customers with a higher consumption.

Two-part tariff

2013-01-09T16:11:59Z

Professional Pricing Society: Created page with "A '''two-part tariff''' is a price structure in which a customer must buy both the durable and the consumable parts of the offer in order to derive value. ..."

A '''two-part tariff''' is a [[Price structure|price structure]] in which a customer must buy both the durable and the consumable parts of the offer in order to derive value. The durable part of the offer will be priced relatively high to extract value from customers, while the consumable part will be priced relatively low but above the [[Marginal cost|marginal costs]] per unit. At times, the price of the durable good is known as the [[Entry fee|entry fee]] and the price of the consumable good is known as the [[Metered fee|metered fee]]. Contrast with [[Tying arrangement]].

Total period price

2013-01-09T16:02:08Z

Professional Pricing Society: Created page with "The '''total period price''' is the total price a customer would for a collection of goods over the same period as that of a comparable subscription if the items were purchase..."

The '''total period price''' is the total price a customer would for a collection of goods over the same period as that of a comparable subscription if the items were purchased independently.

Tit-for-tat pricing

2013-01-09T16:00:31Z

Professional Pricing Society: Created page with "'''Tit-for-tat pricing''' means sequentially mirroring the price moves of a competitor."

'''Tit-for-tat pricing''' means sequentially mirroring the price moves of a competitor.

Tiered price structure

2013-01-09T15:59:39Z

Professional Pricing Society: Created page with "A '''tiered price structure''' is a price structure which attempts to price segment customers according to their willingness to pay ..."

A '''tiered price structure''' is a [[Price structure|price structure]] which attempts to price segment customers according to their [[Willingness to pay|willingness to pay]] for marginal improvements in attributes, features, and benefits. Tiered pricing is suggested when there is sufficient demand heterogeneity along a single dominant dimension.

Tied complements

2013-01-09T15:55:50Z

Professional Pricing Society: Created page with "'''Tied complements''' refer to complementary products for which one of the complementary goods is intended only to be used in conjunction with the other. Contrast with [[Inde..."

'''Tied complements''' refer to complementary products for which one of the complementary goods is intended only to be used in conjunction with the other. Contrast with [[Independent complements|independent complements]].

Third-degree price discrimination

2013-01-09T15:52:08Z

Professional Pricing Society: Created page with "A '''third-degree price discrimination''' is the action of charging separate customer segments different prices where the [[Segmentation hedge|segmentatio..."

Tactical price segmentation

2013-01-09T15:45:51Z

Professional Pricing Society: Created page with "'''Tactical price segmentation''' is a price segmentation that is situationally dependent. E.g. promotional discounts or customer-specific discounting."

'''Tactical price segmentation''' is a [[Price segmentation|price segmentation]] that is situationally dependent. E.g. promotional discounts or customer-specific discounting.

Tacit knowledge

2013-01-09T15:43:38Z

Professional Pricing Society: Created page with "'''Tacit knowledge''' refers to knowledge held that cannot be easily codified or exchanged with others outside of experience or direct interaction with the knower."

'''Tacit knowledge''' refers to knowledge held that cannot be easily codified or exchanged with others outside of experience or direct interaction with the knower.

Superior alternative

2013-01-09T15:38:49Z

Professional Pricing Society: Created page with "An offering is identified as being a '''superior alternative''' to its comparable alternative if the differential value is positive."

An offering is identified as being a '''superior alternative''' to its comparable alternative if the [[Differential value|differential value]] is positive.

Substitutes

2013-01-09T15:37:50Z

Professional Pricing Society: Created page with "'''Substitutes''' refers to two goods (or more) for which the purchase of one good decreases the likelihood of the purchase of the second good. The goods can be products or se..."

'''Substitutes''' refers to two goods (or more) for which the purchase of one good decreases the likelihood of the purchase of the second good. The goods can be products or services.

Subscription

2013-01-09T15:33:56Z

Professional Pricing Society:

A '''subscription''' is a [[Price structure|price structure]] in which a series of goods to be delivered over time are sold as a single item. Some authors have analyzed subscriptions as a form of [[Price bundle|price bundling]].

Subscription

2013-01-09T15:33:47Z

Professional Pricing Society: Created page with "A subscription is a price structure in which a series of goods to be delivered over time are sold as a single item. Some authors have analyzed subscription..."

A subscription is a [[Price structure|price structure]] in which a series of goods to be delivered over time are sold as a single item. Some authors have analyzed subscriptions as a form of [[Price bundle|price bundling]].