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Towards value-driven strategies in pricing IT solutions

Author

Listed:
  • Natalia Reen

    (Isomäki 19B)

  • Magnus Hellström

    (Åbo Akademi University)

  • Kim Wikström

    (Åbo Akademi University
    Åbo Akademi University)

  • Olga Perminova-Harikoski

    (Åbo Akademi University
    Åbo Akademi University)

Abstract

The objective of this paper is to discuss the challenges and opportunities involved in the pricing of industrial IT solutions and to propose practical advice on how to implement value-driven strategy in pricing. A case study of an organisation moving towards value-based pricing is presented. The results provide clarification of new pricing strategies for managers by defining work packages for implementing the transition towards a value-based approach. The findings show that value-based pricing is related to the ability of the organisation to create value for its customers, to charge them according to the value, and implies severe changes in the company’s business model.

Suggested Citation

  • Natalia Reen & Magnus Hellström & Kim Wikström & Olga Perminova-Harikoski, 2017. "Towards value-driven strategies in pricing IT solutions," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 16(1), pages 91-105, February.
    • Handle: RePEc:pal:jorapm:v:16:y:2017:i:1:d:10.1057_s41272-017-0079-z
    DOI: 10.1057/s41272-017-0079-z
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    References listed on IDEAS

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    1. Paul Ingenbleek & Marion Debruyne & Ruud T. Frambach & Theo M. M. Verhallen, 2003. "Successful New Product Pricing Practices: A Contingency Approach," Marketing Letters, Springer, vol. 14(4), pages 289-305, December.
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    4. Shantanu Dutta & Mark J. Zbaracki & Mark Bergen, 2003. "Pricing process as a capability: a resource‐based perspective," Strategic Management Journal, Wiley Blackwell, vol. 24(7), pages 615-630, July.
    5. Véronique Malleret, 2006. "Value Creation through Service Offers," Post-Print hal-00485754, HAL.
    6. Raphael Amit & Christoph Zott, 2001. "Value creation in E‐business," Strategic Management Journal, Wiley Blackwell, vol. 22(6‐7), pages 493-520, June.
    7. Malleret, Véronique, 2006. "Value Creation through Service Offers," European Management Journal, Elsevier, vol. 24(1), pages 106-116, February.
    8. Wolfgang Ulaga & Werner Reinartz, 2011. "Hybrid Offerings: How Manufacturing Firms Combine Goods and Services Successfully," Post-Print hal-00642039, HAL.
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    Cited by:

    1. In Lee, 2019. "Pricing schemes and profit-maximizing pricing for cloud services," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 18(2), pages 112-122, April.

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