Pricing Audit
Pricing audits reveal hidden opportunities
Many business owners give little thought to their pricing. They hem, and they haw, and they attempt to control every aspect of their products. Nevertheless, pricing remains little more than an afterthought. They are chosen once, never to be considered again.
It's a shame that so few realize that small shifts in pricing can radically increase their firms' profitability and strategic advantage.
What's a pricing audit anyway?
Checkups are routine in modern life.
- People consult doctors to get feedback on their health
- People visit mechanics to find out if their cars are safe to drive
- People speak with accountants to ensure that no rules have been violated
Isn't it strange that pricing is one of the only activities that non-experts try to tackle on their own?
A pricing audit is a just what is sounds like: a review of your existing pricing followed by a plan to improve it.
How does a pricing audit work?
There are three fundamental stages to a pricing audit:
- Defining your goals
- Analyzing your pricing
- Suggesting improvements
Defining your goals
- Do your managers agree upon the goals for your pricing strategy?
- Do your managers even have goals for your pricing strategy?
Any pricing audit must begin with an uncovering and explicit declaration of goals. A singular vision is necessary because there is no such thing as the ideal pricing strategy. There are often many pricing strategies that might work. The key is to discover the pricing strategy best suited to help you attain your goals.
- Do you want to attract a certain type of customer?
- Do you want to enter a new market?
- Do you want to defend against a new competitor?
Your answers to questions such as these will determine paths should be taken and which should be avoided.
Analyzing your pricing
Once your goals have been defined, the next step is to evaluate their alignment with your existing pricing page, website, and other collateral. Just as your pricing must be aligned with your strategic goals, it must also be aligned with your messaging, brand, and purchasing process.
Suggesting Improvements
Once your materials have been analyzed, a roadmap for improvements to your pricing can be created.
The recommendations generally include a mix of quick wins as well as guidance for long-range initiatives.
Interested in a pricing audit?
Contact me, and we can discuss how I can help your business.