The traditional approach to pricing based on costs works to pay the bills, but it leaves revenue on the table. You can, in fact, price your products in a way that increases sales--if you know what your customers are willing to pay and can leverage psychology to create better deal and discount plans. In this course, we'll show you how to price a product based on how your customers value it and the psychology behind their purchase decisions. Developed at the Darden School of Business at the University of Virginia, and led by top-ranked Darden faculty and Boston Consulting Group global pricing experts, this course provides an in-depth understanding of value-based pricing and how to use it to capture more revenue.
This course is part of the Pricing Strategy Optimization Specialization
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Offered By
University of Virginia
BCG
Pricing Strategy Optimization SpecializationUniversity of VirginiaAbout this Course
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Course 2 of 4 in the
Beginner Level
Some familiarity with business is helpful, but not required.
Approx. 15 hours to complete
English
Subtitles: English
What you will learn
Customer value applications in pricing products
How to leverage core value-based pricing techniques to inform pricing decisions
How to measure customer willingness to pay using models (surveys, conjoint analysis, other data)
Consumer psychology applications in setting prices beneficial to both consumers and sellers
Skills you will gain
- Customer Willingness to Pay
- Pricing Strategies
- Customer Value-based Pricing
- Measuring Customer Preferences
- Customer Psychology
Flexible deadlines
Reset deadlines in accordance to your schedule.
Shareable Certificate
Earn a Certificate upon completion
100% online
Start instantly and learn at your own schedule.
Course 2 of 4 in the
Beginner Level
Some familiarity with business is helpful, but not required.
Approx. 15 hours to complete
English
Subtitles: English
Offered by
University of Virginia
A premier institution of higher education, The University of Virginia offers outstanding academics, world-class faculty, and an inspiring, supportive environment. Founded by Thomas Jefferson in 1819, the University is guided by his vision of discovery, innovation, and development of the full potential of students from all walks of life. Through these courses, global learners have an opportunity to study with renowned scholars and thought leaders.
BCG
Boston Consulting Group (BCG) is a global management consulting firm and the world’s leading advisor on business strategy.
Syllabus - What you will learn from this course
3 hours to complete
Understanding Customer Value
Welcome to Week 1! We kick off the week with an overview of the course so that you'll know what to expect with an optional review of the specialization and three pricing lenses (watch these if you want a refresher). Then we'll dive into the content! This week, you'll learn about customer value--what it is and its relevance to pricing. You'll see how consumers make decisions--and why knowing consumers' willingness to pay is so important when setting a product's price. Next, we'll take a look at customer value in developing economies and how and why companies succeed (or not!) with value-based pricing in these markets. You'll finish the week with a solid understanding of "customer value" and how that impacts pricing strategy.
3 hours to complete
13 videos (Total 71 min), 3 readings, 3 quizzes
3 hours to complete
Implementing Value-based Pricing
Now that you have an understanding of customer value, let's dive into value-based pricing in greater depth. This week, we'll show you how to price to the demand curve using three tools: the price piano, the price ladder, and incentive curves. We'll take a look at customer value drivers in a B2B context and walk through a process to price a new product. Then Ron and Thomas will show you how price elasticity plays into value-based pricing. Implementing value-based pricing requires detailed analysis. Let's get started!
3 hours to complete
11 videos (Total 62 min)
4 hours to complete
Measuring Customer Preferences
As you learned in Week 1, understanding customer willingness to pay (WTP) is critical for effective pricing. This week, we'll show you two ways to measure willingness to pay: surveys and conjoint analysis. You'll see how one company, Adios Junk Mail, used surveys to better understand WTP. Conjoint is a terrific tool, and we'll walk you through how it's used to determine product preferences and prices. You'll finish the week with a solid understanding of how to measure customer preferences and use this information in your pricing strategy.
4 hours to complete
15 videos (Total 67 min), 1 reading, 4 quizzes
5 hours to complete
Considering the Human Nature of Customers
Last week you considered pricing using a rational utility model. But humans are not always rational beings--and your pricing strategy needs to consider other behavioral drivers. We'll look at the psychology behind consumer purchase decisions and the mental accounting that impacts those decisions. Next we'll consider consumer price perceptions and ways to frame prices and create better deals and discount plans that work for both the consumer and the seller. Then, we'll take a look at two real-world cases, the Portland Trailblazers and Fidelity Investments so that you can practice using tools from throughout the course in a real-world case. You'll finish the course with fresh insights into value-based pricing and its applications.
5 hours to complete
15 videos (Total 78 min), 1 reading, 5 quizzes
Reviews
TOP REVIEWS FROM CUSTOMER VALUE IN PRICING STRATEGY
by VYFeb 18, 2018
The instructors use the real world scenarios in the simplest possible way to be understood , and tell you the to the point concepts involved in these business scenarios
by RKMay 26, 2020
A very good course, which can be recommended for any entrepreneur who is planning to revisit on the Pricing structure/ Formulating Promotional Offers & price revisions.
by EVJun 24, 2020
Although it needs lot of your time and efforts, it surely is totally worth of your hard work and time. Course is very well drafted and presenters have done a great job
by MYNov 2, 2020
Good course to learn practical skills about estimating customer value, performing market research e.g. conjoint analysis, and formulating pricing strategies.
About the Pricing Strategy Optimization Specialization
In this Specialization, we show you techniques to increase price realization and maximize profits. Learn from Boston Consulting Group's global pricing experts and University of Virginia Darden School of Business faculty, who share the frameworks, tips and tools we use in our business and research environments. We will look at pricing through BCG's proprietary and time-tested three “lenses”—cost and economics, customer value, and competition—to build your understanding of the strategic power of pricing. You’ll leave the Specialization with a portfolio-building presentation that demonstrates your ability to price strategically.
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