Customer-Driven Pricing

Dictionary Says

Definition of 'Customer-Driven Pricing'


A method of pricing in which the seller makes a decision based on what the customer can justify paying. Customer-driven pricing is not simply what the consumer is willing to pay, but reflects the value of the product or service from the consumer's perspective. Pricing decisions are made to justify purchase decisions and are at a level that convinces the customer he/she benefits from the transaction.
Investopedia Says

Investopedia explains 'Customer-Driven Pricing'


To optimize pricing, companies need to consider how to best segment the market so that prices reflect the differences in value perceived by different types of consumers. To do this, companies must ensure that there is a comprehensive understanding of the customer and what he or she values. A company would make the most money if they could figure out the maximum each customer would pay, and charge them that amount.



comments powered by Disqus
Hot Definitions
  1. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  2. Momentum Investing

    An investment strategy that aims to capitalize on the continuance of existing trends in the market. The momentum investor believes that large increases in the price of a security will be followed by additional gains and vice versa for declining values.
  3. Momentum Investing

    An investment strategy that aims to capitalize on the continuance of existing trends in the market. The momentum investor believes that large increases in the price of a security will be followed by additional gains and vice versa for declining values.
  4. IPO ETF

    An exchange-traded fund that focuses on stocks that have recently held an initial public offering (IPO). The underlying indexes tracked by IPO ETFs vary from one fund manager to another, but index IPO ETFs are usually passively managed and contain equities that have recently been offered to the public.
  5. IPO ETF

    An exchange-traded fund that focuses on stocks that have recently held an initial public offering (IPO). The underlying indexes tracked by IPO ETFs vary from one fund manager to another, but index IPO ETFs are usually passively managed and contain equities that have recently been offered to the public.
  6. Maritime Law

    A body of laws, conventions and treaties that governs international private business or other matters involving ships, shipping or crimes occurring on open water.
Trading Center