{"id":2303,"date":"2017-04-06T16:35:26","date_gmt":"2017-04-06T11:05:26","guid":{"rendered":"http:\/\/www.intelligencenode.com\/blog\/?p=2303"},"modified":"2026-04-27T14:28:16","modified_gmt":"2026-04-27T08:58:16","slug":"lies-and-damn-lies-about-pricing-data","status":"publish","type":"post","link":"https:\/\/www.intelligencenode.com\/blog\/lies-and-damn-lies-about-pricing-data\/","title":{"rendered":"Lies and damn lies about pricing data"},"content":{"rendered":"\n

It\u2019s one thing for a lie to be a simple inaccuracy regarding a specific set of information. It\u2019s a whole another story and a real problem when those lies become common practices. There are some instances where lies and myths about pricing data become a part of company\u2019s culture, so deeply integrated with their business strategy that it hampers any kind of progress regarding optimal pricing.<\/p>\n\n\n\n\n\n\n\n

Given the overall complexity and volume of pricing data, there are many things that constitute a successful evaluation of price optimization. In this post, we\u2019ll explore the top lies and misconceptions that are more often than not associated with pricing data. Hopefully, this will give you a better understanding and help you make more informed decisions, as well as what you can expect in terms of optimized pricing and improved profitability.<\/p>\n\n\n\n

The lie: \u201cThe market alone dictates the prices\u201d<\/strong><\/h2>\n\n\n\n

The truth<\/u>: While it is true that the market has a direct influence on price ranges, it\u2019s a lie that it alone sets the final price. Pricing managers, accompanying the business\u2019 pricing policy<\/a> and strategy, have the means and the opportunity to differentiate their products and services and create value for them. Market price<\/a> doesn\u2019t necessarily mean you have to accommodate to it, rather you need to accommodate your price to your customers. MIT Sloan performed a research<\/a> a couple of years ago and stated that \u201cpricing power is not destiny, but a learned behavior\u201d, meaning pricing is almost always based on knowledgeable insights, even though competition, costs and price sensitivity within a market have a significant effect.<\/p>\n\n\n\n

The lie: \u201cWe are in a commodity business\u201d<\/strong><\/h2>\n\n\n\n

As a prime example of when a lie or misconception takes a wrong turn, having a firm belief that a company is a commodity business leads to unconditional acceptance of the prevailing prices in the market. Companies needlessly label themselves as price takers, believing higher prices will cause customers to flee. This unnecessary pigeon holing<\/a> clouds the range of factors that customers actually care about and that justify having premium prices.<\/p>\n\n\n\n

The truth<\/u>: This lie, often named \u201ccommodity mindset\u201d, manifests in a shifting strategy that uses competitive price<\/a> cuts to retain profitability as the prevailing thought is it\u2019s better to sell at discount prices than not at all. Yet, this behavior is slowly lowering profit margin to a minimum and actually harming the business by lowering prices too much or too often. It also means trouble in the long run as your customers expect lower prices<\/a> each time, all the while the issue of a price<\/a> increase is practically inconceivable. Instead, focus on the unique selling points of your product, together with the complete service that goes into the process (customer service, delivery, durability, ease of use, etc.) and build your price on that. This ultimately provides incremental value to your product and avoids potential restrictions.<\/p>\n\n\n\n\"Pricing<\/a><\/span>