| So What's the Bottom Line on Price Segmentation? P.J. Jakovljevic - May 28, 2007 The core principle of price segmentation is that pricing should be consistent for deals with similar attributes, particularly in business-to-business (B2B) enterprises. Price segmentation is a process that quantifies similarities by empirically determining which deal circumstances affect price response.
In general, almost every company can benefit from deploying a relevant pricing solution and from improving pricing practices. Organizations should approach the management of selling prices and increases with the same rigor they use to curb upstream supply chain and manufacturing costs. Certainly, if a company has a handful of customers and a few products only, it can probably live without sophisticated pricing management software. However, such a company can still benefit from encouraging its sales force to diligently break down each order (that is, by customer, product, and order size) to figure out where money is being made or lost, or "left on the table.".. |