The surge in access to detailed marketing data and analytic tools has elevated pricing to the forefront of corporate strategy and the driving force of strategic revenue growth. Emerging roles like the Chief Growth Officer (CGO) and Chief Revenue Officer (CRO) focus predominantly on pricing decisions. For most companies, improving pricing strategy represents both a strategic goal and a strategic challenge. Most struggle with the same basic questions: How do we formulate a pricing strategy? What should we charge? Which data and methods should we be using to make pricing decisions? Who should be in charge of pricing decision-making?
McKinsey predicts ``65 to 85 percent of [B2B] organizations expect to adopt gen AI or agentic AI in pricing over the next one to three years, up from just 10 to 30 percent today.'' But in practice, most firms still use ad hoc rules-of-thumb. The simplicity of these rules comes at a substantial cost to a firm's potential profitability. Most rules fail to align pricing with consumers' perceived value and underlying willingness-to-pay. Many firms also struggle with the delegation of pricing responsibility within the organization, exacerbating the use of rules-of-thumb that fail to deliver effective pricing decisions and monetize. The fact your company made money last year does NOT confirm the optimization of your prices: you may be leaving substantial money on the table.
This course blends marketing analytic frameworks, marketing strategy, microeconomic theory and customer data to formulate actionable pricing strategies. Students learn how to coordinate pricing decisions with the rest of the marketing value proposition. Numerous pricing structures are developed in the course, along with their microeconomic foundations. Students learn the underlying theory for each pricing structure, along with the practical considerations for implementation. Students will use generative AI to implement quantitative and analytic pricing solutions that leverage customer data.
The course combines cases and analytic assignments to teach students how to design and execute pricing strategies. The examples span a wide array of business contexts including services, B2B, and B2C.
