Pricing in a Downturn: A Tailored Response to Price Pressure
- Topics:
- Price Optimization,
- Pricing Strategy
- Source:
- McKinsey & Company
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Overview: Downward pressures on pricing can be acute during periods of economic contraction. Such times, however, also create unique conditions for tailoring pricing strategies to prevent further price erosion, create select margin gains, and lay the foundation for more profitable pricing when the economy turns upward. This paper talks about four tactics that address prevailing price pressure and set the tone for more effective pricing strategy in the future: strengthen basic pricing discipline, fine-tune pricing differentiation on the basis of the mutual attractiveness of the company and the customer, modify price/benefit offerings to reflect downturn-related needs and attitudes of customers, and reshape fundamental price models and offerings.
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Format: PDF | Size: 424KB | Date: Jan 2002 | Pages: 15
