Pricing for consumer health and non-reimbursable products
Setting the right price has a huge impact on the gross margin of the product and therefore on the P&L of the business unit. Due to differences in their price elasticity, the demand of some products drops dramatically when the price is increased, while for others, it stays the same
At LECA, we study all the factors that could impact price elasticity of demand, and we recommend a price range for your product so you can maximize your bottom line
Although many factors involved in the pricing process are subjective,
Our methodology provides the right price for your company strategy
Elasticity of price to demand
The best price is the result of accurately assessing all the factors which can affect price elasticity: brand perception, the level of competition, product durability, the pricing of other alternatives, the market share of the product amongst other things
Find analogues
Records of price changes in analog markets can help us anticipate the reaction of our market to similar price changes. However, it should be noted that only a few products may be valid as analogues
Aligned with your commercial policy
Understand pricing as the key lever to your commerial policy, but not the only one - discounts, payment terms and other conditions can also make a difference
Reaction of competitors
Sometimes competitors can change their pricing strategy based on our decision. For example a “price-reduction strategy” can be quickly implemented by competitors so that you gain no additional units but lose gross margin
Brand loyalty
The price is highly important in the consumer’s perception of a product. A higher brand value allows us to set higher prices, though it does bring with it higher expectations
Ask customers or patients about price changes and observe their reaction before it is too late
Build different scenarios
Simulate consumers’ and competitors’ reactions to different prices, anticipating their behavior and assessing the impact on your P&L in order to make the right decision
What LECA brings to the table
Ample experience in setting the right price based on historical projects and benchmarks
An evidence-based methodology that allows us to use historical data and analogues in a smart way
Support during and after the implementation. That way, the results of our decisions and the reaction of competitors can be analyzed
Guidance to increase your brand value and improve customer loyalty, which, once achieved, mean being able to set higher prices