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The conceptualization of value-based pricing in industrial firms

Journal of Revenue and Pricing Management volume 11, pages 12–34 (2012)Cite this article

Abstract

The current literature is largely silent on how executives interpret the concept of value-based pricing. Although only a minority of companies adopts value-based pricing approaches, little is known about antecedents of alternative pricing approaches. We suggest this may be because of the fact that few professionals possess an understanding of value-based pricing, which is both academically rigorous as well as practically relevant. Our interviews with 44 executives in 15 US industrial firms show that those practicing value-based pricing interpret customer value in ways fully consistent with the current academic literature. Those practicing cost- or competition-based pricing, however, show a poor understanding of value-based pricing, which may explain why their companies practice cost- or competition-based approaches.

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Author information

Authors and Affiliations

  1. Weatherhead School of Management, Case Western Reserve University, Cleveland, Ohio, USA

    Stephan M Liozu, Richard Boland & Sheri Perelli

  2. Hinterhuber & Partners and Bocconi University, Milano, Italy

    Andreas Hinterhuber

Authors
  1. Stephan M Liozu
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  2. Andreas Hinterhuber
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  3. Richard Boland
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  4. Sheri Perelli
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Corresponding author

Correspondence to Andreas Hinterhuber.

Appendices

Appendix A

Table A1

Table A1 Themes and sub-themes definitions
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Appendix B

Table B1

Table B1 Identified value-based pricing methodologies in business publications
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Appendix C

Table C1

Table C1 Detailed sample information
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Appendix D

Table D1

Table D1 Detailed sample description
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Appendix E

Table E1

Table E1 Value-based pricing conceptualizations
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Liozu, S., Hinterhuber, A., Boland, R. et al. The conceptualization of value-based pricing in industrial firms. J Revenue Pricing Manag 11, 12–34 (2012). https://doi.org/10.1057/rpm.2011.34

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  • DOI: https://doi.org/10.1057/rpm.2011.34

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