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competitive pricing strategy

Adopting Competitive Pricing Strategy in Healthcare: What to Keep in Mind

For healthcare companies to attain a healthy profit margin and ensure quality outcomes, it is essential to connect their pricing strategy with the day-to-day operational concerns. With the rising healthcare market competition, healthcare companies must be cautious while creating and implementing their competitive pricing strategies as overlooking even small factors can cause them to lose out on their competitive advantage. Competitive pricing strategy in healthcare does not necessarily mean a race to the bottom in order to offer the lowest prices. In this blog, experts at Infiniti explain the key factors that enable healthcare organizations to create a robust competitive pricing strategy.

Whether you charge higher or lower prices than your competitors, you must have a value proposition that justifies those prices. Request a free proposal to know how we can help your business identify and set optimum prices for your products and services.

Building a robust competitive pricing strategy in  healthcare

competitive pricing strategyEstablish market identity

Many healthcare organizations are under the misconception that a competitive pricing strategy has got to do primarily with becoming a low-cost or low-price player. Although some low-acuity services such as imaging may require a low-cost option structure, healthcare systems may continue to provide care at historical rates for other services. Moreover, organizations must also seek to understand what their current market identity is and what they want it to be in the future.

Facing trouble with your current pricing strategy? Get in touch with our experts for more insights on how you can transform your existing pricing strategy.

Proactive process to maintain margins

Healthcare organizations need to proactively review prices in order to isolate and resolve any potential margin issues before risk to revenue or compliance occur. It is vital to emphasize on improving key service lines and identifying margin and compliance risks by payer and service lines. Healthcare organizations must also focus on educating their staff on key issues so that charge capture violations can be easily prevented.

Engage in meaningful interactions

Several organizations resort to the practice of using tools to establish their competitive pricing strategy. However, these tools often fail in terms of adjusting to price sensitivity in the market. Although tools prove to be beneficial in building a competitive pricing strategy, it is insufficient to create an overall competitive advantage in the market. While interacting with consumers online, healthcare companies have a unique opportunity to deepen consumer relationships. Providing value messaging, online scheduling, or a live chat option are ways to create meaningful interactions with customers. Furthermore, healthcare organizations can also create a seamless customer experience with flexible payment options as a part of their competitive pricing strategy.

Price transparency to create value

Giving patients a clear idea of what exactly they are being charged on is an effective competitive pricing strategy that can induce patient loyalty. Being transparent with prices can also help healthcare organizations to increase their customer base on a larger scale. Ensuring transparency is pricing is one of the best ways to communicate value to customers and increase consumer confidence towards the organization.

To learn more on the right competitive pricing strategy for your business

Penetration pricing strategy

Infiniti’s Penetration Pricing Strategy Helped a Consumer Electronics Company Achieve 22% Increase in Market Share

Penetration Pricing Strategy for a Consumer Electronics Company

With a large number of consumer electronics products being introduced every year, companies in the consumer electronics market are facing difficulties to increase market share and sales volume for their products. Also, as pricing largely impacts customers’ buying behaviour, it becomes vital for consumer electronics companies to competitively price their products. However, for companies that are new to the market, it is even vital to introduce some introductory offers to set up their customer base in a particular market. This is where penetration pricing comes in. Penetration pricing strategy helps businesses gain sales traction. This also helps businesses to increase market share.

Penetration pricing strategy helps businesses to lure customers away from established competitors. Request a FREE proposal to know how our product pricing strategies can help your business to achieve maximum market share within a short span of time.

Business Challenge

The client is a consumer electronics company in Europe. The client was new to the European market. As the European consumer electronics market was highly saturated, the client was facing difficulties in competitively pricing their products. The client even faced difficulties to lure customers’ attraction, build brand loyalty, and generate demand for their products.Therefore, they approached Infiniti Research to leverage their expertise in formulating a penetration pricing strategy. With Infiniti’s price penetration strategy, they also wanted to analyze the pricing strategies adopted by competitors and devise an appropriate penetration pricing strategy to gain market share and attract customers.

By leveraging Infiniti’s penetration pricing strategy, the client wanted to achieve the following:

  • As pricing plays a major role in customers’ buying behavior, the client wanted to leverage penetration pricing strategy to build customer base quickly by selling products at a lower price. By building a better customer base, the client wanted to enhance their sales rate.
  • As the client was new to the European consumer electronics market, they were facing challenges in capturing market share. With Infiniti’s penetration pricing strategy, the client was looking to provide introductory discounts to customers and capture maximum market share.
  • With Infiniti’s penetration pricing strategy, they also wanted to eliminate the market competition by offering products at a lower value compared to their competitors.
  • With Infiniti’s penetration pricing strategy, the client also wanted to create a mass market for their products and establish themselves as market leaders.
  • With Infiniti’s penetration pricing strategy, they further wanted to measure customers’ sensitivity to price changes and identify the price gap with their competitors.

CONTACT US to know how our penetration pricing strategy can help your business to formulate an efficient pricing strategy for your business.

Solutions Offered and Value Obtained

The experts at Infiniti Research followed a four-phased approach to formulate an efficient penetration pricing strategy for the client.

Conducted a thorough market pricing analysis – The experts at Infiniti Research also analyzed the European consumer electronics market players and their pricing strategies. The factors such as competitors’ product offerings, pricing strategies, market position, strengths, and weaknesses were considered during the analysis.

Analyzed the target audiences – The experts analyzed the needs and demands of the client’s target customers. The experts also analyzed customers’ buying behavior, customers sensitivity to price changes in the market. They also analyzed how consumers’ reacted to new product launches in the market.

Analyzed competitive landscape – The experts analyzed the top five competitors of the client. They further analyzed the structure of their pricing, discounts, and their market share.

Created a pricing strategy and execution plan – Based on the insights obtained, the experts at Infiniti Research formulated a pricing strategy for the client. The formulated pricing strategy plan acted as a blueprint that helped the client to efficiently price their products to gain maximum market share.

Results Obtained

With Infiniti’s penetration pricing strategy, the client was able to create a mass market for their products in Europe. They were also able to build a better customer base and achieve a high market share. By offering products at a lower price compared with their competitors, the client was able to surpass the competition. Infiniti’s penetration pricing strategy helped the client to enhance brand loyalty. Furthermore, it helped them to sucessfully establish their market presence in the European consumer electronics market.

Also, by leveraging Infiniti’s penetration pricing strategy, the client was able to:

  • Grow their market share by 22% in the course of one year
  • Capture customer traction by offering products at lower prices
  • Build customer and brand loyalty

For a new venture, figuring out how to price your products or services is highly challenging. Infiniti’s penetration pricing strategy can help you efficiently tackle this challenge. Request for more information to gain more insights into our services and learn how our penetration pricing strategy can help you achieve high market penetration rates quickly.

What is penetration pricing strategy?

Penetration pricing strategy is a business process in which the prices of products are initially kept low to reach a wide fraction of the market. This also helps businesses attract customers towards their brands and also outpace the market competition. Furthermore, penetration pricing strategy stimulates market growth and helps companies capture maximum market share for their products or services.

Advantages of penetration pricing strategy

  • Helps businesses to capture maximum market share in a short time
  • Enhances brand loyalty and also brand awareness
  • Helps companies gain a leading edge in the new or existing market compared with competitors
  • Helps achieve higher market penetration rates quickly
  • Encourages word of mouth marketing and also enhances customer experience

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