This week’s reading focused on topics and tips related to “Social Venture Feasibility and Potential.” In addition to focusing on the Buyer Utility Map, a tool for analyzing customer value, and the Business Model Guide, a device for determining how to meet customer need while maintaining profitability, the reading focused on how innovators should set their prices.
Given my experience and struggle with determining appropriate pricing for ventures I have worked on in either a classroom or a competition space, the strategic pricing portion of the article was the most interesting to me. My past difficulty in this area arose from the challenge of choosing a price that would both attract customers away from competitors while still turning a profit.
In an effort to expand upon the pricing advice given by Kim and Mauborgne, I located the following articles:
- http://www.markitek.com/articles/pricing.htm
- http://www.netmba.com/marketing/pricing/
- http://www.inc.com/guides/price-your-products.html (This recently written article is particularly interesting)
- http://www.allbusiness.com/business-planning-structures/business-plans/3780692-1.html
Feel free to peruse the links; hopefully you will gain some additional insight into how to set the price of the product/service provided by your social venture. One thing that strategic pricing leads me to wonder is how successful even the most strategically priced good/service can be against well-established competitors. These “market giants” may be able to cut their prices for a while, in order to match your strategic price and prevent customers from switching from their service to yours, resulting in a temporary setback for them, and bankruptcy for you. Does anyone know of any tips/tricks to combat such “market giants” other than those presented within the article? Feel free to share.
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