Case Study: Industrial Supplier Revises Product Design and Charges Higher Price Based on Pricing Study Results
- Our client was able to launch this product at a 500 percent premium over the existing product.
- The findings of the research directed engineering to revise accuracy of the product from 0.5% of flow rate to 0.2%.
The study indicated:
- Customers highly valued the client’s product
- The product’s ability to deliver highly accurate and repeatable measurements resulted in customers’ willingness to pay a significant premium over current products on the market
- Price premiums were highest for low-flow applications
Improving measurement accuracy to 0.2% of flow rate (a significant improvement from the current 0.5% of flow rate) resulted in even higher perceived value and significantly higher prices customers would be willing to pay.
Sales in the first year validated the results of the pricing study as sales exceeded expectations.
A leading supplier of thermal mass flow controllers was in the process of creating a second generation Coriolis mass flow controller for several key industrial markets. While our client understood their customers placed a high value on accuracy and repeatability, their interest was in assessing the price customers would pay for a highly accurate and repeatable product.
- To understand the value of accuracy and repeatability across a number of market segments
- To determine the price customers would be willing to pay for improving these product features
AMG Research utilized a mixed methodology approach that combined telephone interviews and an online conjoint analysis survey.
First, telephone calls were made to customers and non-customers in North America and Europe to qualify respondents and gather background information related to their current mass flow measurement practices.
Respondents who qualified were directed to a web-based survey where they participated in an online conjoint analysis exercise.
More than 240 telephone interviews and 145 web-based surveys were completed for the project.
The study was conducted in both North America and in Europe.
Why AMG Research was Chosen
AMG Research was selected to conduct the research based on our experience in conducting pricing studies, our focus in industrial markets, and our ability to conduct the study in North America and Europe.