Life Sciences Manufacturer and Distributor
Leveraged Market Research to Create Value-Based Pricing
Utilized market research to develop value-based list and discount pricing, resulting in $2.4M price impact in year 1
Maximizing Pricing Power: A Data-Driven Approach to Value-Based Pricing
A life sciences products manufacturer & distributor leveraged market research to develop strategic pricing and discounting, driving $2.4M in price impact.
For a life sciences products manufacturer and distributor, revenue growth relied heavily on volume rather than optimized pricing power. With limited differentiated pricing strategies and decentralized quoting authority, the company faced challenges in capturing full market value. By leveraging market research, customer segmentation, and a data-driven pricing model, the company redefined its pricing structure. Through strategic contract renegotiations and a discounting algorithm to guide sales, the company achieved a $2.4M price impact in just one year while strengthening its understanding of customer value drivers.
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Situation
Unlocking Pricing Potential: Moving Beyond Volume-Based Growth
Decentralized quoting and lack of differentiated pricing limited the company’s ability to capture true market value.
- Revenue gains were coming from volume versus potential pricing power
- Limited differentiated pricing approaches across Client’s core business lines
- Sales team had authority to quickly quote for acquiring new customers without centralized pricing guidance
- Price setting for new products was traditionally based on similar products without full consideration ofvalue drivers and long-term revenue potential
Market Research Findings
Conducted in-depth qualitative interviews to understand customer purchasing criteria and value drivers and align with pricing and product strategy
Approach
Harnessing Market Insights to Build a Value-Based Pricing Strategy
By segmenting customers, refining pricing models, and optimizing discounting, the company aligned prices with market demand and long-term value.
- Conducted market research and utilized quantitative findings to segment customers into cohortsbased on similar characteristics and gain insights on value drivers and pricing perception
- Executed data-driven pricing model and toolset that recalibrates list price, provides guidance fordiscounting, and maximizes pricing value over time
- Adjusted list price to align prices to market performance and value
- Renegotiated customer contracts to enable broader adjustments
- Developed a discounting algorithm to provide to sales team with discount guidelines to enable morerapid quoting and customer acquisition across customer types (contracted, partner, etc.)
List Price Adjustment Model
Developed new value-based list prices to serve as an anchor for pricing across channels and end customers
Discount Model
Built a 3-step discount model to guide sales and drive volume growth
Impact
Translating Customer Insights Into Pricing Impact
Identifying value drivers led to smarter pricing and measurable results in one year
$2.4M
Price Impact in 1 year
Learned customer behavior and value drivers
Developed new value-based list prices
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