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Value Based Pricing

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The presentation of Value Based Pricing for Dutch Social Entrepreneurs has been successful. I got a lot of critical questions and feedback on the research, which really helps me to improve the paper.

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Value Based Pricing

  1. 1. “The only variable of the marketing mix that creates revenue and determines the competitiveness of a company is pricing” - De Toni et al
  2. 2. 2 • 2016 Nomination Opzij Impact Award • 2011 Winner Executive MBA Scholarship • 2009 Founder Life Impact Company GLORIA VAN EWIJK MSC MBA
  3. 3. 3 The role of values, attitudes, perceptions and experiences of Dutch social entrepreneurs in their decisions toward Value Based Pricing.
  4. 4. 4 1. Challenge The Status Quo 3. Alignment of values in business models 2. Customers want value
  5. 5. 5 1. COST-BASED PRICING  Set your own price  Ensures profitability  Gap price policies, value proposition and customer needs 2. COMPETITION- BASED PRICING  Takes market into account  Change prices only when the competition does  Creates a passive mindset 3. VALUE- BASED PRICING  Relies on customer’s willingness to pay  Depends on customer’s ability to understand your offer  Working closely with the customer
  6. 6. Value Price Primarily based upon perceived or estimated value by the customer. VALUE-BASED PRICING
  7. 7. Successful use of VBP New or enhanced products or services Competitors in your market already use VBP Unique package of products and services Products incorporating novel technology Introduction of existing products or services into new markets Complex transactions based on clear understanding of the customer’s need Products completely new to the world with no viable alternative technologies
  8. 8. 8 Buyers make a suggestion for a product’s price and the transaction occurs only if a seller accepts this quoted price NAME YOUR OWN PRICE The customer must pay a subscription price to have access to the product / service. SUBSCRIPTION PRICING Let the customer decide what they want to pay for the product / service PAY AS YOU WISH PRICING Deliberately establishes himself as the supplier of the highest price product in the market segment. PREMIUM PRICING Flexible prices for products or service based on current market demands. DYNAMIC PRICING The product or service is free of charge, but money (premium) is charged for additional features and services. FREEMIUM PRICING
  9. 9. Challenges  Difficult to understand how higher value translates to higher prices  Traditional businesses are not ready to work with value-based pricing methods  Customers have different needs and do not always want to work closely with the entrepreneur Benefits  Value based pricing created new opportunities, markets & collaborations.  Co-creating closely to the customer  Responding to actual need of the customer and learning from them

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