Healthcare is one of the perennial needs of mankind, and the health industry provides innovative products, services, and strategies for an endless stream of customers. Pharmaceutical companies need to recover costs of research and development, marketing, and eke out a profit amidst a business environment rife with competition and an uncertain economy. You need pricing strategies that really work no matter how the market shifts. Pharmaceutical policies draw national attention, and a company that fails to properly value its products may find itself quickly losing ground.
The primary goal of pricing strategies is for your success as a business, but since health is a national concern, there is pressure to have new cutting-edge pharmaceutical products available to as many people as possible. The government may impose regulations on drug pricing, but this may actually end up as an advantage to a company.
Pricing Products and Services Based on Perceived Value
Determining true value is one of the most difficult tasks in creating a pricing strategy. Under-pricing hampers true profit potential, but over-pricing can simply cause you to lose customers. There are three most common ways of determining price: based on products costs, based on the competition, and based on the customer's perceived value of the product. Of these pricing strategies, value-based pricing gives you a much more efficient Return Of Investment.