Services Offered
Strategic Marketing Decisions provides consulting services in pricing, product design policy, and marketing strategy. In spite of its direct impact on sales and profitability, price is very often determined using simple rules of thumb. The lack of a systematic analysis to support a pricing decision may lead to poorly thought out marketing dtrategies and prices that fail to fully capture a product's sales or profit potential. We work collaboratively with our clients to provide training along with both the quantitative and qualitative analyses needed to make the best possible strategy and pricing decisions.
Quick List
(Click on the service heading for links to further information.)
Pricing Review and Analysis
The process of setting prices varies substantially from company to company and may vary among products within a company. A pricing review examines the current pricing policies and their appropriateness for the market and competitive environment. The objective is to evaluate the effectiveness of the current pricing policies, identify alternative approaches, and assess their potential effectiveness for the company. A basic review utilizes data that is readily available within the company and identifies data sources and/or studies that are likely to have the greatest value in improving pricing decisions. More in-depth reviews will also include additional studies, such as demand, competitor, and cost analyses (see below). (More)
Demand Estimation and Market Simulation
A thorough understanding customer preferences and price sensitivity is important in predicting how they will respond to a pricing policy. By understanding how price influences brand preference and choice, you will be able to more profitably capture a fair share of the value your products and services provide customers. SMD advocates an approach that includes four steps: 1) Segmentation, 2) Preference Analysis, 3) Choice Modeling and 4) Demand Modeling. The resulting model can be used to predict how any firm's sales, market shares, and profits will vary with changes in the price or another key attribute of one or more products. (More)
Competitor Analysis and Modeling
A clear understanding of the key competitors is essential in predicting market outcomes. It is important to be able to predict what actions a competitor will likely take and how they will respond to changes in the environment. A failure to do so will slow response times and perhaps result in taking an action that will trigger an unfavorable competitive response. A competitor analysis will help you identify competitive threats and determine a product and pricing policy that will improve your market position while minimizing the risk of unprofitable competitive retaliation. It will also assist in predicting competitive impacts and likely responses to potential pricing actions. (More)
Cost and Financial Analysis
Surprisingly, many businesses do not have a good knowledge of what it costs them to provide their goods (products and services). Even when cost data is available the estimates are often distorted by accounting practices.When setting price, it is important to determine how costs change with changes in the level of activity. A cost and financial analysis will help you identify your true costs of doing business. The cost analysis can be used to more accurately assess the profit impacts of price changes and modifications in your product and service offerings. (More)
Channel Analysis
Companies that use resellers do not have complete control over their prices. A company that uses resellers has limited control over the prices the resellers charge to their customers. A channel analysis will help identify the current practices of the sales force, wholesalers and retailers with an eye toward finding out why they are acting the way they do and identifying actions that might improve their performance. (More)
Strategy Assessment
A sound strategy is central to the success of a business. It defines who the target customers are going to be, how a company will appeal to them, and how it will address competitors. The business strategy should guide how the company is organized as well as objectives and how performance is going to be measured.
A strategy assessment reviews the target market selection and the company's current and potential performance in serving those targets. Recommendations are made regarding potential changes in target markets and repositioning with respect to them, adjustments in product and service offerings, and modifying pricing policies to most effectively implement the desired strategy. (More)
Product Analysis
Product design decisions should consider how important features are to customers in influencing satisfaction and what it costs to deliver on those features at different levels of performance. By measuring how effectively competitors deliver on those features the product design team can identify potential opportunities and provide guidance with regard to which features provide the greatest profit potential. Product line decisions are complicated by the need to understand the potential for cannibalization making adjustments in product offerings and prices accordingly. When launching new products, the potential benefits and costs of "skimming" and "penetration" strategies should be considered. (More)
On-Site Training
SMD provides customized on-site training on pricing and related strategic marketing topics. In these classes, participants get to work on exercises that relate to issues currently facing the company. When possible, the classes will address specific issues facing the company, making the classes much like an interactive consulting session. (More)
(Contact SMD for more information)
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