Pricing is a process, not an event. This mantra is important for companies who think pricing is something they do annually, when they update price books, or in special circumstances when they add a fuel surcharge. But pricing is happening … Read More
pricing strategy
Microsoft’s Pricing Dilemma
Microsoft is between a rock and hard place. The Redmond software giant made an enviable $17.6B in profit last year (see MSFT for more details) but the stock is down from its bubbly peak and has been stagnant for almost … Read More
More on risk measurement– recency bias
Measuring risk is a critical, yet impossible task. How can we act effectively without understanding the risk? How can we see the future? Or, what is the right balance between educated estimates of risk and potential benefit? These questions are … Read More
Thoughts on commodities
I recently returned from a two week trip to India. I visited high tech campuses that shimmered more brightly than their counterparts in California and villages where people relied on manual water pumps. The responsibility for feeding the billion-plus Indians … Read More
How do you measure risk?
Few decisions in business or in life are without risk. The outcomes we expect from our decisions depend in some part on a set of assumptions about the world around us. For big decisions with a large impact, we often … Read More
One area of pricing strength
While the economy as a whole risks deflation, there was one area with strong pricing power. According to PNC’s annual survey the cost of hiring lords a’leaping, buying partridges, pear trees, and other accoutrements of the 12 Days of Christmas … Read More
What’s worse than inflation?
When commodity prices surged and governments around the world pumped hundreds of billions of dollars into markets, crippling inflation was a major risk. However, demand is so soft that the Consumer Price Index (CPI) fell a record 1.0% in October. … Read More
Price Increase via Package Change
Customers hate price increases. So many companies keep the price the same, but reduce the amount of product sold. I recently came across an example of this when my wife came from the grocery store with a big container of … Read More
Sometimes it’s about deciding who your customers aren’t
On a recent Apple earnings call, CEO Steve Jobs took a question from an analyst wondering why Apple did not introduce a lower priced laptop. Jobs’ response (thanks to CNet):What we want to do is deliver an increasing level of … Read More
3 Approaches to Pricing in the Downturn
The economy is in turmoil, credit markets are in terrible shape, inflation is high, and consumer confidence is low. If you just received billions of dollars in taxpayer money as a reward for your part in wrecking the world financial … Read More