Product Positioning Strategy Maximizes Revenue

Situation
Faced with thousands of unique products, a large division of a global manufacturing organization was struggling with how to appropriately price these products effectively against one another. Product managers were managing their portfolio using their own criteria, and making strategic decisions that often did not align with the overall business strategy.

Approach
Price for Profit, along with other price management initiatives at the client’s, helped develop a common set of metrics for product portfolio optimization. The process incorporated easily accessible data in the areas critical to the client:

• Profitability
• Capacity
• Competitive advantage
• Growth rates

Utilizing a common set of decision tools, product managers were able to optimize the products within their own portfolio’s and then effectively align the portfolios across the business to clearly articulate the best overall pricing strategy.

Results
The product positioning process gave clear direction on how to best price products within and across portfolios and was quickly adopted by all product managers. In addition, it enabled operations, sales, marketing, and other parts of the organization to work together more effectively by having alignment that resulted in a clear pricing and prioritization strategy.