The right pricing strategy can change the entire trajectory of a business, a market, and even society at large. To help you create your best pricing strategy efficiently and confidently, two leaders from BCG are introducing fresh perspectives on pricing that take you far beyond the realm of mind-numbing numbers.
In their new book Game Changer: How Strategic Pricing Shapes Businesses, Markets, and Society, Jean-Manuel Izaret and Arnab Sinha simplify and clarify pricing strategy by integrating its many frameworks and concepts into seven distinct pricing games, each with its own proven tools, rules, forces, and structures. To help you pick the right game and play it well, Izaret and Sinha have developed the Strategic Pricing Hexagon, a tool refined through years of testing, iteration, and adaptation. The Hexagon is your portal to a business world where stronger growth and better financial performance come from a set of strategic pricing decisions, not endless myopic quests for optimal prices.
But more than that, the Hexagon will change the way you think about and talk about pricing. The current conversation around pricing - as expressed through economics textbooks, Excel spreadsheets, political discourse, and educated guesswork - makes it easy to believe that pricing is nothing more than a technical, tactical and, for most people, boring game of numbers. Game Changer changes that conversation bysharing stories and research that bring the Hexagon and its seven pricing games to life.
With research from BCG’s Bruce Henderson Institute and real-world examples from the world's most influential companies, the authors and their colleagues at BCG define pricing strategy as a business leader’s or business owner’s conscious decisions about how money flows in their market. They show how companies succeed in the long term when they focus on collaborative growth and value sharing with customers, not zero-sum value extraction from them.
Discover how you can create and implement a winning pricing strategy that changes the trajectory of your business, your market, and even society.
Table of Contents
Introduction: Changing the Pricing Conversation 1
Part I Rethinking Pricing Strategically 19
Part I 19
1 Three Information Sources 25
2 Four Economic Frameworks 40
3 Seven Games in the Strategic Pricing Hexagon 51
4 Six Market Forces 69
5 What the Hex? The Political Angles of Pricing Decisions 77
6 What’s Next? The Design of Pricing Models 90
Part II Winning the Seven Pricing Games 107
Part II 107
7 The Value Game: When Art Trumps Science 109
8 The Uniform Game: The All- Time Classic 119
9 The Cost Game: Where Efficiency Reigns 134
10 The Power Game: When Every Move Counts 147
11 The Custom Game: Making Sense of the Chaos 163
12 The Choice Game: Framing Options for Customers 179
13 The Dynamic Game: When Everything Matters 194
Part III Changing Your Pricing Game 209
Part III 209
14 Innovation: Seizing a Step- Change Opportunity 211
15 As- a- Service: Growing with Your Customer 219
16 AI: Perfecting Price Differentiation 228
17 Channel: Going Direct to Consumers 237
18 Scale: Achieving the Ultimate Cost Advantage 246
19 Free: Competing with the Most Magical Price Point 254
Part IV Shaping Society Through Pricing Decisions 265
Part IV 265
20 Fairness: How to Differentiate Prices Across Customers 267
21 Equitable Pricing: How Buyers and Sellers Share Value 281
22 Access: How Pricing Can Eradicate Diseases 294
23 Green Premium: How to Shape Demand for Sustainable Solutions 308
24 Co2 : How to Encourage Lower Carbon Emissions 325
25 Impact: How Progressive Pricing Can Scale Social Ventures 337
Epilogue 349
Appendix: About the Studies 353
Notes 359
Acknowledgments 387
About the Authors 391
Index 393
