Answer to Question #208984 in Management for Prince

Question

SUBJECT : SERVICE MARKETING

Elaborate any 5 challenges in the pricing of the services along with any 7 recommendations with elaboration , to overcome these challenges ?

Answer 1

Here are some frequent price and value management difficulties that organizations should avoid when developing their business plans and strategies. Not fully comprehending the value that their service provides to their clients. Companies must first assess what value their products and services provide to the clients they serve or hope to recruit. The organization may be able to provide varying amounts of value to different sorts of clients. Launching a new service comes with a lot of risks, and organizations have a low probability of succeeding. The failure rate of a new product rises dramatically when corporations do not adequately recognize the value of their innovation and do not appropriately arrange the pricing.

Pricing in relation to the value delivered is misunderstood by the market. Customers who do not grasp the value of the services are more likely to object to the rates charged by businesses. Companies should effectively convey our worth to people who value it, manage value and pricing perceptions and customer behaviors, assess disparities between perceptions and reality, and change their communications techniques accordingly. Different clients or segments served have misaligned offers and prices. Many businesses fail to modify their offerings when they serve a variety of customers with various value expectations. Some people want high value and are willing to pay for it, whereas others prefer lower value and are willing to pay a lower price. Enterprises can do it successfully using the "offering menu" concept, but B2B companies don't use it consistently.

A lack of policies to guide pricing in the field or inefficient price governance. This is usually due to a lack of visibility into the genuine pricing achieved through direct or indirect sales channels. Excessive or unwarranted discounting could potentially jeopardize the integrity of pricing charged to identical clients buying the same volumes. Guiding pricing policies to protect value and the offer, marketers should enhance price transparency, and define rules and decision rights. Price execution and pricing controls are ineffective. Companies should guarantee that customer-facing staff follow the price strategy as stated.