The price isn't right - pricing is the most important driver of long-term profitability and should be top of every board’s agenda

60 %
40 %
Information about The price isn't right - pricing is the most important driver of...
Business

Published on April 2, 2014

Author: KPMGUK

Source: slideshare.net

Description

My name is Robert Browne and I’m a pricing specialist and partner in KPMG’s Strategy Group. Since starting out in the early 1990s as an economist in telecoms, I’ve worked all over the world and across many sectors, helping businesses optimise their pricing. I believe it’s the most important driver of long-term profitability and should be top of every board’s agenda. My goal, with this editorship, is to raise the profile of pricing as a strategic issue within Britain’s boardrooms. As well as setting out some of my ideas in the articles below, there are also responses from three of our sector experts and one of our business intelligence experts. I hope you enjoy reading about this fascinating and highly relevant topic.

0 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS My name is Robert Browne and I’m a pricing specialist and partner in KPMG’s Strategy Group. Since starting out in the early 1990s as an economist in telecoms, I’ve worked all over the world and across many sectors, helping businesses optimise their pricing. I believe it’s the most important driver of long-term profitability and should be top of every board’s agenda. My goal, with this editorship, is to raise the profile of pricing as a strategic issue within Britain’s boardrooms. As well as setting out some of my ideas in the articles below, there are also responses from three of our sector experts and one of our business intelligence experts. I hope you enjoy reading about this fascinating and highly relevant topic. THE PRICE ISN’T RIGHT

1 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS DEBATE: DO WE NEED AN INTERNET PRIVACY CHARTER? Demand doesn’t always respond to price changes, particularly if every company reduces prices or increases promotions at the same time. I’ve seen companies cut prices by 20% only to see volumes move minimally. THE 10% PROFIT OPPORTUNITY THE PRICE ISN’T RIGHT

2 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS DEBATE: DO WE NEED AN INTERNET PRIVACY CHARTER? Following the financial crisis, automotive firms identified bank finance and consumer credit as their biggest obstacles to sales. PRICING: THE AUTOMOTIVE RESPONSEFUTURE OF WORK

3 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS DEBATE: DO WE NEED AN INTERNET PRIVACY CHARTER? In many companies, pricing decisions are often shared between sales, operations and finance. This increases the probability of getting it wrong. THE ELEPHANT IN THE BOARDROOMTHE PRICE ISN’T RIGHT

4 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS With some notable exceptions, pricing policy in this sector is too short-term. Change is needed, beginning with a clearer understanding of what promotions actually cost. PRICING: THE CONSUMER GOODS REPONSE THE PRICE ISN’T RIGHT

5 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS As we slowly emerge from the downturn, many IM companies are seeing a surge in demand and the challenge has flipped. Now they have to get customers to accept that prices can go up as well as down! PRICING: THE INDUSTRIAL MANUFACTURING RESPONSE THE PRICE ISN’T RIGHT

6 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS I believe analytics will become a competitive standard for all businesses, online and offline. ANALYTICS: IS THE FUTURE FOR PRICING THE PRICE ISN’T RIGHT

7 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS Rarely do I see D&A observations transform an organisation’s customer-facing process; never have I seen them drive change to an organisation’s culture. Why? Because it’s scary. DIGGING FOR INSIGHTS WITH GEEKS AND PROPELLER-HEADS THE PRICE ISN’T RIGHT

8 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS 40% of companies in our survey said they had sacrificed margin through lower prices to drive sales in the past 1-2 years. Read additional data and insights from KPMG’s 2013 pricing survey. BY THE NUMBERS: PRICING IN THE UK THE PRICE ISN’T RIGHT

9 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS Customised offers, variable pricing and auction models will allow retailers to win back some power from savvy consumers. PRICING: THE RETAIL RESPONSE THE PRICE ISN’T RIGHT

10 Vision Technology © 2014 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. SLANT KPMG SELECTED VIEWS AND OPINIONS FROM OUR BRIGHTEST MINDS EXPLORE THE PRICE ISN’T RIGHT THE PRICE ISN’T RIGHT

Add a comment

Related presentations

Boat chandlery

Boat chandlery

October 26, 2014

http://ecommerce-for-business.com/shackles-boats-theboatonlinestore/ We offer a ...

http://vendere-su-internet.com/shackles-for-boats-from-theboatonlinestore/ Moori...

Silver bar!

Silver bar!

October 21, 2014

Pretty similar to gold bars are these silver slabs. Silver is considered as the mo...

Gold coin prices!

Gold coin prices!

October 21, 2014

If you are an investor of gold bars and coins, one of the major things that you ou...

CyberSecurity's social media stats for one week as of Oct 21st 2014

CyberSecurity's social media stats for one week as of Oct 28th 2014

Related pages

Profitability Ratio Analysis - All About Business Finance

Every firm is most concerned with its profitability. One of the most frequently used tools of financial ratio analysis is profitability ratios ...
Read more

Retail Pricing Strategies to Increase Profitability

Retail pricing strategies are important to ... Setting the right price is a crucial ... we should look at how our competition is pricing ...
Read more

Profitability Indicator Ratios: Profit Margin Analysis ...

Profitability Indicator Ratios: Profit Margin Analysis; ... for the most part, directly ... when discussing a company's profitability. While undeniably an ...
Read more

Pricing Strategy - NetMBA

Pricing strategy, including pricing ... One of the four major elements of the marketing mix is price. Pricing is an important ... The pricing policy should ...
Read more

Explaining Price Elasticity of Demand | Economics | tutor2u

Price elasticity of demand measures the responsiveness of demand after a change in a product's own price. ... Price elasticity of demand ... most important ...
Read more

Price-To-Sales Ratio (Price/Sales) Definition | Investopedia

BREAKING DOWN 'Price-To-Sales Ratio - PSR' The 12-month period used for sales in the price-to-sales ratio is generally the past four quarters (also called ...
Read more

Pricing Strategy project final - Scribd

Pricing Strategy project final ... mix is price. Pricing is an important strategic ... price still remains one of the most important elements ...
Read more

Pricing strategy and execution: an overlooked way to ...

Pricing strategy and execution: an overlooked way ... through an ad hoc pricing process. This isn't as ... most important driver of change ...
Read more

3 Ways to Sell a Product - wikiHow

How to Sell a Product. ... information to the right people, it is important to translate the product ... that a product isn’t right for a ...
Read more