Should Pricing Belong to Marketing? Ask an Expert
Answer: S, You are absolutely right. Pricing is much broader than marketing.
The 4 P’s: Promotion, Product, Place, Price
First, as a marketing professor, let’s defend the 4 P’s. If you think of marketing as the process of managing the touch points with buyers, those 4 P’s are pretty reasonable. Promotions or advertising are a valuable touch point. The product is crucial to what the buyers are buying. The Place, or distribution network, is the point of sale to the customer and is critical. Finally, Price is an equally important touch point.
Next, nobody says Product is a part of marketing any more. Companies have Chief Product Officers. They have product management teams that don’t report into marketing. Anybody who uses the 4 P’s as a structure to organize their company will struggle.
Pricing: Customer Value and Infrastructure
Pricing is a verb, not a noun. I’d say 75% of pricing is creating, communicating and capturing value. To implement that 75% well requires product management, marketing and salespeople all to understand value and then do their best to enhance the market’s perception of that value.
**Note: Mark Stiving has an active LinkedIn community, where he participates in conversations and answers questions. Each week, he creates a blog post for the top question. If you have a question, head over to LinkedIn to communicate directly with Mark.
Mark is a pricing expert who helps companies understand value, how to create it, communicate it and capture it. He has a PhD from U.C. Berkeley and an MBA from Santa Clara University, plus 25+ years pricing experience. As an educator, speaker and coach, Mark applies innovative, value-based pricing strategies to guide growth and increase profits for large and small companies.