Business Situation
- A leading design software provider wanted to test a new pricing framework for its as-a-service offering and understand customers’ willingness to pay for its upcoming solution.
- The client also wanted to develop a comprehensive understanding of competitors’ similar offerings, customer preferences, and market white spaces.
SGA Approach
- SGA provided a comprehensive solution covering the following dimensions:
- Competitor Pricing Strategy: Understanding competitor product bundling, pricing models, and current operating price points, including discounting motions.
- Performed detailed competitor IDIs or expert interviews (n=20) to gather highly solicited pricing insights
- Customer Willingness to Pay: Gathered feedback around product features and needs, product purchase behavior, and purchase price intent
- Conducted thorough customer Interviews (n=20) and market survey for broad-base validation (n=400)
- Applied statistical technique of conjoint analysis to derive optimal and recommended price points
- We supported the client’s pricing strategy team in understanding the commercial feasibility of the company’s new offering. SGA also helped the client evaluate competing pricing models and strategies, providing recommendations on market targeting and customer-validated price points for the company’s cloud-based offerings.
Key Takeways
- Ground-breaking intel from competitive research became a foundation to determine market competition and test price range.
- Creating a clear picture of customer reaction toward product preferences and pricing helped inform the client’s go-to-market (GTM) strategy.
- Insights and recommendations across key industry verticals and customer groups allowed for better strategy creation.
- Excel-based pricing simulation improved the testing of various scenarios, facilitating product pricing optimization with inputs across industries, geographies, and customer types.
