Product Pricing

How to Price a Product/Service

Product and service vary in pricing strategy, yet encompass the same fundamental principles. The diagram below (Firend, 2019) illustrates how considerations such as total & fixed cost, economic environment, the competitive landscape, and the kind of service/product offered (and buyer type) in addition to product strategy and positioning, all of which, determines the final price.

Reference: Firend (2019)

For example, services can be sold bundled or unbundled. As such, the final pricing strategy will take into consideration the most beneficial approach to shaping the final price, encompassing the elements in the diagram above.