The 3rd EPP Global Pricing Maturity study shows a clear improvement in organizational pricing maturity, with only 22% of the companies in the survey still working in a pure volume driven organisation, with mainly sales in the pricing driver’s seat.   More than 60% of the organisations are working (or reached) on a level 2 pricing maturity, taking transactional control (installing vital pricing analytics and margin improvement projects, wiht floor and target prices, a new discount and surcharge policy and compliant price derogation processes). 

On the other hand, the next step in developing the pricing maturity is more challenging.  Only a small 13% of the organisations in the survey assess their pricing maturity as ‘level 3’, meaning that they working on installing a value and profit strategy, implementing value based pricing where  possible, understanding price elasticity within micro-segments, explore (more) dynamic pricing and  improve value communication and value selling….

Crossing the Pricing Chasm* is still a difficult to realize change.  We described the challenges in the Book ‘Crossing the Pricing Chasm’ and the challenge is still there.   The number of companies working towards a level 3 pricing maturity stays flat (2016 survey (16%, now 13%).

Different studies show that a strong, top level supported, profit culture makes the difference between low and high performers in any industry. And it is clear that top management involvement in advocating a profit orientation culture is crucial.  But it’s also clear that pricing managers are (or should be) important change agents to lead the organization towards a value and profit orientation culture. 

Different studies show that a strong, top level supported, profit culture makes the difference between low and high performers in any industry. And it is clear that top management involvement in advocating a profit orientation culture is crucial. But it’s clear that pricing managers are (or should be) important change agents to lead the organization towards a value and profit orientation culture.