An effective brand price architecture is important in the FMCG industry because it can help companies appeal to a wider range of consumers and increase sales. By offering products at different price points, companies can target consumers with different budgets and preferences. It can also help companies to differentiate their products and avoid cannibalizing their own sales by offering too many similar products at similar price points.
But what does it really mean? And much more importantly, what happens when one tries to “appeal to a wider range of consumers and increase sales”?
Can appealing to wide range really drive sales? Is the solution to the constant need of getting higher and higher volumes a wide / vast portfolio? In our humble opinion — no it isn’t. And this is where a proper application of Brand Price Architecture comes in, especially for the FMCG industry.
Firstly, it is not always good to want to win in all price bands. I really can’t think of any FCMG Brand that plays across Super Premium / Premium / Value for Money / Affordable and Cheap. Secondly, having a vast range of flavours, pack sizes, etc. do not necessarily drive Incremental Volumes. Yet, a walk down any Supermarket aisle will show you a plethora of examples of brands wanting to “appeal to a wider range of consumers and increase sales”.
To add muscle to our argument, let us give an example of a FMCG Category that has always been a particular favourite of ours when we think of Brand Price Architecture. It is the Carbonated Soft Drinks Category. You will find a limited number of flavours and SKUs. Yes, they also introduce limited time launches — but this is done after careful consideration to drive excitement in an already established category. The Price variation for the same product is truly astonishing — simply take all the SKUs and calculate the Average Price Per Unit and you will be amazed. The much sought for Premiumization is achieved then and there!
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So, the next time there is a discussion on adding more sub-variants to “appeal to a wider range of consumers and increase sales”, ask one simple question — Will this bring Incremental Buyers? If yes, go ahead. If not, we suggest you proceed with caution.
If you found this interesting, please do reach out to us to see how we can help you drive data driven business growth.
- Understand Your Market and Audience: Before diving into pricing strategies, it’s crucial to thoroughly understand your target market and audience preferences. Conduct market research to gather insights into consumer behavior, competitor pricing, and industry trends. Identify your target demographic’s willingness to pay and their perception of value associated with your brand.
- Segment Your Product Portfolio: Not all products are created equal, and each may cater to different consumer segments. Segment your product portfolio based on factors such as functionality, quality, and target audience. This allows you to adopt a tailored pricing approach for each product category, maximizing revenue potential while catering to diverse consumer needs.
- Implement Value-Based Pricing: Value-based pricing revolves around aligning your prices with the perceived value of your products or services in the eyes of the consumer. Instead of solely focusing on production costs, consider factors such as brand reputation, product uniqueness, and customer benefits. Highlighting the value proposition through effective marketing messaging can justify premium pricing and enhance customer willingness to pay.
- Utilize Pricing Tiers and Bundling: Offering multiple pricing tiers or bundles provides consumers with options that cater to varying needs and budgets. This strategy allows you to capture a wider range of customers while encouraging upselling and cross-selling opportunities. Ensure that each tier or bundle offers clear differentiation in features or benefits to justify price discrepancies effectively.
- Monitor and Adjust Pricing Dynamically: The pricing landscape is dynamic, influenced by factors such as market demand, competitor actions, and economic conditions. Implementing dynamic pricing strategies, supported by data analytics and pricing optimization tools, enables you to adapt swiftly to changing market dynamics. Regularly monitor key performance indicators and consumer feedback to fine-tune your pricing strategies for optimal results.
- Communicate Transparently: Transparency builds trust and credibility with consumers. Clearly communicate your pricing rationale and any changes to your pricing strategy. Provide transparent information regarding product value, pricing tiers, and any discounts or promotions. Transparency fosters positive consumer perceptions and reduces the likelihood of price-related objections or dissatisfaction.
- Continuously Innovate and Experiment: The pursuit of optimization is an ongoing process. Embrace a culture of innovation and experimentation within your organization to uncover new pricing strategies and opportunities. Test different pricing models, promotional tactics, and product configurations to gauge their effectiveness. Analyze results and iterate accordingly to stay ahead of the competition and meet evolving consumer expectations.
In conclusion, optimizing your brand price architecture requires a strategic approach that considers market dynamics, consumer preferences, and value perception. By segmenting your product portfolio, embracing value-based pricing, and leveraging dynamic pricing strategies, you can enhance your brand’s competitiveness and profitability. Transparent communication and a commitment to continuous innovation are key pillars in achieving long-term success in price optimization. Embrace these principles, and empower your brand to thrive in today’s dynamic marketplace.
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To help customize your WordPress pages, there are many excellent plugins.
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We know you’ve been hearing A LOT about the vital importance of customer data and using it to maximize your CX and customer journey; in fact, you’ve probably heard so much about it that you could find yourself stuck at a point of trying to determine the path between where you are now and where you know you need to go.Keeping up with all of the innovations and advice on creating a seamless, sensational customer journey can be somewhat daunting.
Having a road map that points you on the right road with some clear, implementable insights can maximize your CX efforts, and help you optimize and influence the end-to-end journey of your customer.With this in mind, here’s four solid fundamentals to begin working on now:Build One 360 View of Your CustomerCreating one unified view of the customer is essential, and best-in-class organizations start building their customer journey optimization process by building a fully dimensional view of their customer through data insights.By building a single, comprehensive customer view, you are better able to understand how the purchases, screen times, interactions, and behaviors of your customers will drive future actions.
You can therefore target them more effectively with the most appropriate messages at the most optimum time.
This insight helps sales and marketing teams partner together and produce more resilient strategies and effective campaigns, boosts the quality of every engagement, and helps you craft relevant content that resonates with the customer agenda.Once this 360 view has been designed, it’s crucial that it is shared across all your business stakeholders, so they not only understand the customer, they also know their role in optimizing the customer journey.Additionally, by implementing artificial intelligence (AI) technologies and utilizing prescriptive analytics, organizations now have the ability to cut through copious amounts of raw data generated every day – from corporate information, social media, shopping cart behaviors, research trends and influencer opinions to build a holistic knowledge of the customer.Turn Data Insights into Data ActionsJust collecting or having customer data itself isn’t useful; it’s what you ultimately can do with it.Emerging capabilities in data analytics, data modeling, and artificial intelligence are now empowering your customer insights by interpreting data and directing action, which can fundamentally disrupt and improve the way you engage your clients.So how does empowering your data to improve the customer journey?
Here are just three basic, daily routine examples:Lead generation – Gaining an understanding of experiential factors from a ‘tire-kickers’ data provides your sales team with significantly more targeted and accurate sets of measures and triggers that can be used to perfect lead generation and sales execution.Demos – Having the right insights at the right time can make all the difference in a demo, augment sales calls, or hold the attention of everyone on the Zoom call by demonstrating you know what they want and how to get them there.Boost Cold Call Opportunities – Utilizing an insight trigger such as a news story about a customer or knowing about a change up in their product line can be the catalyst that makes a target client receptive to a call from your sales team that illustrates at just the right time how you can solve their pain points during a time of transition.
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“How to Manage Your Time?” is a question that many have but often refrain from asking because they think that it might sound too childish as they feel most of the people around them are acing the time management game.
Poor Time Management Skills can lead to stress and work overload, this might lead to depletion in mental health and a drop in your overall productivity, disturbing the balance between your professional and personal life.
It has been truly said that answers to such questions can only be found by oneself, but a little help from others can help a person go a long way.
Follow Mindful Zoya’s blogging page for getting insights about time management, life outlook, and other things to increase the horizons of your thinking.
Even for world-famous authors, selling books depends on interested readers discovering them.
Therefore, if you’re asking yourself about how to market a book, it’s essential to focus on things that will reach potential readers.
Because most books and ebooks are sold online, the first thing to do it to make sure they are remarkably well described in the promotional pages of large online booksellers.
Also, don’t overlook the carefully selected keyword, because most people find pages through a search.It’s also a given that nearly every book and author today have a website to support book sales.
Effective book marketing depends on a place for readers to find out everything they can about a book – and a website is a hub for links to everything written about it online.
Similarly, an author’s social media channels also can contain links to stories and coverage about the book that fans and prospective readers will find interesting.Effective book marketing to help sales also relies significantly on publicity.
