The meaning of strategic pricing

There are many reasons why customers refuse a company's pricing. Price is often not the only reason, or even the cause of the problem at all. In most cases, price rejection is a symptom and signal after other elements of pricing strategy have problems. Enterprises must understand the symptoms of price rejection in order to diagnose the gap in pricing strategies. If we can't diagnose the real source of pricing problems and only focus on solving superficial problems (such as price reduction), it will damage the profitability of products and enterprises in the long run. An effective pricing strategy can match the price with the value. Pricing strategy consists of multiple levels, which are the support points of pricing and can maximize profits. The combination of these levels forms a strategic pricing pyramid. Based on value, value creation is equivalent to the cornerstone of the pyramid. A deep understanding of how products and services create value for customers is an important source of information for the formation and development of pricing structure. Once the price structure is determined, marketing can develop information and tools to communicate value information with consumers. The last step before determining the price is to ensure that the pricing process within the enterprise can withstand the test of aggressive customers and competitors and be consistent.