Is perceived value = Price?

For highly differentiated product and services, how do customers perceive value? For doing customer centric pricing understanding the perceived value is critical. In this example from The Street for investment advice media company’s products when we created price elasticity models the price elasticity models for around 60%+ of the subscribers for subscription renewal were highly non-monotonic

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Impact of granular pricing

Personalized pricing has the potential of doubling revenue over a single optimal price. At the same time adopting a pricing optimization model that optimizes price at an individual level has major risks. After all, how do you get customers to pay a different price for the same product without alienating them?

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Granular pricing – Customer Acceptance

One of the key challenges in implementing optimized pricing at an individual level is retaining customer loyalty with differential pricing.

Some of the strategies that have proven successful in this area are

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