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Pricing Concepts and Methods

Using data and information to set prices.
Level 1 Demonstrates introductory understanding, directing people to the appropriate source for further information.

BEHAVIORS

  • Explains the fundamentals of price-setting strategies, such as cost-plus pricing, demand or value-based pricing, and competitor indexing.
  • Collects and maintains internal and external data to inform pricing decisions, (e.g. customers, competitors, products and service offerings).
  • Follows prescribed methods to produce thorough and accurate reports summarizing pricing information.
  • Recommends price in line with price setting strategies.

QUESTIONS

  • Tell us about a time when you collected and maintained internal and external data to inform product pricing decisions.

Probing Questions

* What was the situation?

* What did you do?

* What was the product that pricing decisions were being made about?

* What was the result of your efforts?

  • Describe a situation where you prescribed methods to produce thorough and accurate reports summarizing pricing information.

Probing Questions

* What was the situation?

* What information did you gather and summarize?

* What methods were employed?

* What was the report used for?

Level 2 Applies the competency in common situations that present limited difficulties, working with a moderate level of guidance.

BEHAVIORS

  • Describes the relationship between pricing and the overall financial, marketing and strategic objectives of the organization.
  • Conducts pricing analyses on internal and external data to identify drivers for setting/changing prices (e.g. labor market information, inflation, price elasticity, etc.).
  • Conducts an ongoing diagnosis of pricing performance using measurement tools (e.g. value maps).

QUESTIONS

  • Describe an occasion when you recommended a product or service pricing in line with appropriate price setting strategies.

Probing Questions

* What was the product or service?

* What were your personal responsibilities with regard to recommending product/service pricing?

* What were the appropriate price-setting strategies?

* What were the results of your recommendations?

  • Tell us about a time when you conducted pricing analyses on internal and external data to identify drivers for setting or changing price.

Probing Questions

* What was the product or service requiring pricing decisions?

* What data and analysis were you tasked with providing?

* How did you conduct the requested analysis?

* What were your findings or recommendations?

* What was the impact of your analysis on product/service pricing?

Level 3 Applies the competency in the full range of typical situations, requiring guidance in only the most complex or new situations.

BEHAVIORS

  • Implements strategic pricing policies across a range of products/services and segments.
  • Sets price consistent with strategic pricing policies and valid market analysis.
  • Manages pricing portfolio by customizing pricing to the unique needs of the customer and/or the market.
  • Integrates multiple analyses on industry dynamics and market conditions to assess the impact on price setting.
  • Uses product and customer lifecycle data to inform pricing strategies.
  • Makes recommendations to adapt pricing strategies based on interpretations of analytical data and pricing performance.

QUESTIONS

  • Describe a situation where you were responsible for implementing strategic pricing policies across a range of products/services and market segments.

Probing Questions

* What was the situation?

* What were the strategic pricing policies being implemented?

* How was the implementation conducted?

* What were the results of your efforts?

  • Tell us about a situation when you managed a pricing portfolio by customizing pricing to the unique needs of the customer and/or the market.

Probing Questions

* What was the pricing portfolio that you managed?

* What were the unique needs addressed?

* How did you address them?

* What were the results of your work?

Level 4 Applies the competency in new or complex situations and advises others.

BEHAVIORS

  • Develops pricing strategies aligned with the financial, marketing and strategic objectives of the organization.
  • Revises pricing strategies as necessary to accommodate changing market conditions.
  • Coaches others on pricing setting techniques and methods.
  • Provides organizational oversight with regards to price setting.
  • Foresees market changes and trends and anticipates how to adapt to them.

QUESTIONS

  • Tell us about a situation when you were required to develop pricing strategies that were aligned with the financial, marketing and strategic objectives of the organization.

Probing Questions

* What was the situation?

* What were the key alignment issues?

* How did the pricing strategies address the alignment issues?

* What were the results of your alignment efforts?

  • Describe a time when you identified market shifts and trends and anticipated how to adapt pricing strategy to them.

Probing Questions

* What was the situation?

* What were your personal responsibilities?

* What were the market changes and trends that you identified?

* What changes to pricing did you recommend?

* What was the outcome of these recommendations?

Level 5 Develops new approaches and methods in the area. Is recognized as an expert within the organization.

BEHAVIORS

  • Oversees the development of competitive and sustainable pricing strategies.
  • Promotes the strategic and creative use of pricing to achieve organizational objectives.
  • Influences the organization’s strategic direction through potential pricing strategies.
  • Champions pricing as a key value driver for the organization.
  • Monitors organizational revenue and recommends appropriate pricing strategies, taking into account pricing constraints and sensitivity of demand to price changes.

QUESTIONS

  • Tell us about a time that you promoted the strategic and creative use of pricing to achieve organizational objectives.

Probing Questions

* What was the situation?

* What was your role?

* What were the strategic and creative uses of pricing that you promoted?

* What was the impact of these strategic and creative uses of pricing on organizational results?

  • Describe a situation when you influenced the organization's strategic direction by proposing different pricing strategies.

Probing Questions

* What was the situation?

* What was your role and responsibility in this situation?

* What were the pricing strategies?

* How did the pricing strategies influence the organization’s strategic direction?