Data-Driven Pricing Optimization and Customer Retention

Solo episode with Bruce Sinclair, the host of the show, discussing how to improve pricing optimization and customer retention by gathering primary customer data with smart tech. On pricing optimization: Some companies use cost-plus pricing and others use competitive-based pricing, but the gold standard is value-based pricing. Since price is exchanged for value, to get the price right we need to understand how much value the product produces… which is easier said than done. Until recently, understanding what exactly the customer values and how much they value it is a qualitative research project at best. But now we have virtual products – native and virtualized. Software and tech products that can use APIs to gather the primary data needed to calculate produced value and smart products that can use sensors to gather the primary data needed to calculate produced value… On customer retention: As we all know, it's far more profitable to keep a customer than to acquire a new one, whether that's to sell them more of the same or new products or services. The absence of a direct relationship results in a loss of customer control and potentially a loss of customer without ever knowing why. Today selling a physical product doesn't have to mean the end of the customer relationship. Smart products are connected to the internet and just like software, they are forever connected to the customer… In this episode, Bruce discusses: Why using secondary data for pricing optimization is risky and a qualitative research project at best. How smart apps and products can capture primary data for pricing optimization. Example sims and what they are. The limitations of customer visits for fetching primary customer data. The OEM business killer of not having direct customer contact. The competitive advantage Netflix, Autodesk and Amazon have that can now be applied to virtual and physical products. Related links you may find useful: Article 1: Pricing Optimization with Primary Data Article 2: Customer Retention by Staying Connected to the Customer LinkedIn newsletter containing these and future articles Season 1: Related episodes Season 2: Episodes and show notes Season 2 book: The Private Equity Digital Operating Partner Season 1 book: IoT Inc Training: Smart digital transformation certification

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Data-Driven Pricing Optimization and Customer Retention is an episode from The Internet of Things (IoT) Show with Bruce Sinclair by Bruce Sinclair.

This episode is 14:47 long.

This episode was published on Jan 10, 2023.

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