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Pricing and commercial strategy

Gain competitive advantage by creating and executing winning pricing strategies that foster innovation and drive sustainable impact.


A sound pricing strategy remains a very effective profit lever in business and can propel your organization to the next level of performance. We typically find 3% - 8% return on sales in incremental impact driven by type of Industry and level of starting pricing maturity.

Many organizations lack the strategic mindset, execution ability, and discipline to unlock value from pricing. Without a clear “owner” of pricing and cross-functional linkages, many organizations struggle to set a strategy and achieve next-level pricing capabilities.

KPMG’s Pricing and Commercial Excellence team can help.

Our deep industry knowledge, cutting-edge methodologies, and industry-leading data and analytics capabilities can help you choose the right solution to help deliver value for your business and customers.


KPMG's pricing framework answer key questions...

Pricing strategy

Pricing strategy

  • What are the different customer segments?
  • How do product/service offering align with the business strategy and segments?
  • How can we extract value from customer segments?
  • What value extraction mechanisms and price bases most align to customer value?


 

Price setting

Price setting

  • How much is the product/service worth to my customer segments?
  • How do I ensure I get paid the right price for this product/service?
  • How do I incorporate cost, competition, and value in setting prices?
  • What discount structure do we need to drive customer behaviors?

 


 

Price execution

Price execution

  • How do we integrate pricing processes with sales processes?
  • How do we identify and correct issues with pricing and discount leakages?
  • How do I manage and optimize my cost-to-serve customers?
  • How can negotiations based on value and not price alone help sales achieve better win rates and price points?


 

Pricing embedment

Pricing embedment

  • How do we ensure sustainability in setting and executing the right prices over time?
  • Which are the people and capabilities requirements?
  • What governance mechanisms and decision rights are needed to help pricing changes stick?
  • Which data and tools support decision making and monitoring?


 

Are you...

A corporation?

We can help you drive performance improvement in the face of:

  • Increasing commoditization
  • Escalating competitive intensity
  • Volatility in costs of raw materials
  • Diminishing value perception from customers
  • Missing pricing ownership

A private equity or portfolio company?

Let us help you:

  • Target portfolio companies with the greatest opportunity for improvement
  • Identify pricing with the highest ROI
  • Accelerate time to value in a rapid / agile manner
  • Ensure teams follow best-in-class practices

An organization considering a deal transaction?

We can assist buyers and sellers across the transaction lifecycle by:

  • Identifying potential opportunities for pricing improvement in a target or division
  • Estimating potential uplift in revenue for each opportunity with limited data and tight deadlines
  • Ensuring post-deal value creation


KPMG’s pricing approach

At KPMG, we focus on the core areas of the pricing journey and help you overcome the specific challenges your organization faces in today’s shifting marketplace.

Our pricing perspective helps you achieve next-level capabilities by focusing on five key value drivers:

 

1

Relentless focus on impact: Typical pricing engagements yield 3%-8% Return on Sales within 3-12 months; quick wins can drive 50-100 basis points of value.

2

A thorough performance improvement approach: KPMG brings to bear multiple areas of specialization, so that pricing recommendations are coherent with the overall organizational strategy, market dynamics, product portfolio, and operating model.

3

Exceptional analytical capabilities: Market leading data and analytics tool arsenal that drive descriptive, predictive, and prescriptive capabilities.

4

Tailored industry strategies: Our belief is that pricing should be tailored to industry nuances. Our deep experience across Industries provides custom insights and overlays.

5

An enablement mindset: We help organizations internalize recommendations through pricing tools and technology, people and skills, decision rights, reporting and more.

 

 

Leverage transactional data to find hidden insights, perform rapid pricing assessments to identify opportunities, and leverage our pricing maturity evolution survey to identify improvement areas. With our pricing and integration experience, we can help you foster innovation, drive impact, and gain a competitive edge.

 

Top 7 pricing mistakes

1. Customer focus - Decisions are not too customer-insight focused.

2. Testing - Little focus on test and learn.

3. Elasticity - Misunderstanding of the power and limitations of elasticity.

4. Untapped potential - Value left on the table due to fear of excessive disruption.

5. Embedding - Giving up sooner than needed on knowledge transfer and upskilling team.

6. Value communication - Lack of effectiveness in communication price increases to the market.

7. Monitoring - Limited learning from the wanted and unwanted effects of pricing decisions.

Meet the team

Sudipto Banerjee

Sudipto Banerjee

Principal, Pricing & Commercial Excellence Leader, KPMG US

+1-404-907-6173
Richard Chen

Richard Chen

Managing Director, Strategy, KPMG US

+1 949-431-7285
Serena Crivellaro

Serena Crivellaro

Managing Director, Strategy, KPMG US

+1 212-954-7468


 

Edoardo Poli

Edoardo Poli

Director, Strategy, KPMG US

+1 917-438-3847
Aloke Mondkar

Aloke Mondkar

Manager, Strategic Pricing Advisory, KPMG US

+1 312-665-1000
Jorge Monraz Perez

Jorge Monraz Perez

Manager, Strategy, KPMG US

+1 312-665-1051