Tuesday, March 23, 2010

49% of Global Executives unlikely to increase prices in 2010

49% of Global Executives Unlikely to Increase Prices in 2010, Survey Says completed by SAMPRAD, Business Development Advisory and Pricing Strategy Consultants.

Buoyant outlook for markets yet cannot increase prices

Venugopal Chepur, the author of the study, explains that while hoping for buoyant market conditions, about half the respondents said they would be unable to increase prices this year. Of the 171 Senior Marketing and Global Senior Management Executives surveyed, 49 percent reported it was unlikely that they would increase prices during the current year 2010.

Only 16 % were sure about increasing prices while 24% were likely to consider the proposal for price hikes, and the rest 11% were not sure.

Greater concerns about Economy, Inflation, a range of responses:

- Nearly 47% reported they would increase prices owing to Inflation (Fuel hike, Cost of Funds etc);
- 22% gave "increase in demand" due to flat or short supplies (bottomed out inventories) to be likely reason to increase prices;
- 20% felt there may be a decrease in demand for goods & services during the year;
- Only 10% cited Increase in Buying Power (Ease of Credit, Employment, Buoyant markets etc) as reasons to be able to increase prices.
- Adding features & benefits to hold or increase prices work much better than removing features to hold or lower prices.
- 40% reported they would upgrade their offerings to avoid discounts and about 26% felt they could hold prices with temporary discounts;
- 16% of respondents would try bundling of products & services to hold or increase prices, while less than 5% said they would decrease prices during 2010;
- Less than 10% would remove features & benefits in order to hold prices and about 12% cutting costs and adjust price terms
- 77% of do not use Pricing Software and Pricing Consultants
- 77% have reported that they neither use any pricing software, nor have external pricing specialists/consultants guiding pricing decisions.
- Only 10% have both, and just over 6% have either pricing software or a pricing consultant.

Survey Participants were Executives representing both B2B and B2C segments in US and Global including emerging markets.

Participating executives constituted both B2B (53%) and B2C (47%) segments in US (57%) and global (39%) including emerging markets. Most were members of MENG (Marketing Executives Networking Group – a premier US national network of top-level marketing executives, and IERG (International Executive Resources Group – organization of Senior Business Executives from around the world).

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