Price Benchmarking for Major Consumer Services Group

Introduction

The client was part of the growth team for one of the largest investors in the world by assets under management. We were asked to come in and support the research efforts for a major pricing strategy exercise one of the portfolio companies was undergoing. This portfolio company is one of the best known consumer services brands in the United States.

Brief

The client was working with their portfolio company to streamline pricing and increase revenue across nearly 500 locations in the US. This exercise was complicated by both the number of locations, and the different regional and local price sensitivities each location faced. Consequently, a major national survey was required, to understand how local competitors priced and positioned themselves against the portfolio company.

Actions

Working with the client, we identified a representative sample of services common to all competitors nationally. We then set out to sample 3 local competitors for each portfolio company location across the United States.

Posing as potential customers, we conducted phone interviews with nearly 1,500 competitors, obtaining detailed information on both the availability of the sample services and the pricing for each. These interviews were conducted over the course of 3 weeks.

Outcome

The client received a comprehensive, detailed Excel data set from which it was possible to build a sophisticated pricing model that greatly increased the competitiveness of a large part of the portfolio company’s locations.

The client also received a summary document synthesising the insights from speaking with close to 1,500 competitors. The client was able to take a number of these insights and apply them immediately across the portfolio to improve their marketing and sales effectiveness, which further increased profitability across the entire group.