Customer-oriented pricing: duel or duet?

Understanding customer needs

In order to successfully implement a customer-oriented pricing policy, you need to understand the diverse needs of your customers. Only if you analyze these needs in detail and individually will you be able to better tailor your pricing strategy to the requirements of your target group. Customers’ needs can vary greatly and range from financial considerations to emotional aspects. A thorough investigation of these needs requires not only quantitative data, but also qualitative insights. You can ask your customers directly, observe their behavior or analyze feedback from social media. Once you have identified customer needs, you should understand how these can affect your pricing. For example, customers who are particularly value-driven may prefer a pricing structure that emphasizes perceived value. Price-sensitive customers may be more responsive to discounts and special offers. In the next step, you can incorporate these findings into the development of individual pricing models in order to find the optimal balance between customer satisfaction and profitability. Important factors here are, for example, what benefit the customer gets from your product or how often they use the product. However, setting up such models requires not only a technological infrastructure, but also clear communication to convey the added value of these individual approaches to customers. A deep understanding of customer needs is therefore the foundation for a customer-oriented pricing policy that not only takes financial aspects into account, but also strengthens the emotional connection to the customer.

Examples of customer-oriented pricing

By focusing not only on the product itself, but also on the promised effect, the retailer assumes the customer’s usage risk. This helps to increase the customer’s price awareness and trust. In some markets, it is possible to enrich the product with additional services and market both together. One example of this is the service offered by drinks manufacturers who deliver a fixed selection and number of drinks directly to the home or office of private and business customers for a fee. By taking over the entire logistics, from delivery to collection of the bottled goods, the procurement costs for customers are reduced. This in turn has a positive impact on customer loyalty. Flat-rate prices, as are common in the telecommunications industry, offer users the security of purchasing a predetermined quantity of units for a fixed amount. This transparent price structure creates trust and security among buyers, who are prepared to accept a higher price for this certainty. Price satisfaction increases in this context, which in turn promotes customer loyalty. Price bundling, where a retailer offers various goods at a single price, also contributes to customer loyalty. If the total price is generally lower than the sum of the individual prices, this results in increased price satisfaction among customers. Furthermore, transparent pricing, as can be found in shopping cart configurators in e-commerce, for example, helps to reduce shoppers’ fear of hidden costs in the long term. The clear presentation of the costs for the selected configuration increases price satisfaction and thus promotes customer loyalty.

Conclusion

Suppliers with a customer-oriented pricing policy can exert a targeted influence on the price satisfaction of their customers and thus increase customer loyalty while still selling with a focus on margins. The biggest advantage compared to other customer loyalty measures is that your costs are comparatively low. The most important prerequisite here is that you know the pricing behavior of your target group precisely. Customer loyalty should be the focus of your business and increases your success, because: Loyal customers buy more often, loyal customers buy more and of higher quality, loyal buyers are more generous, loyal customers are immune to other suppliers, loyal customers act as free salespeople.