Pricing Strategies for Retail

I have spent years in the highs and lows of the consumer goods industry but never seen a pricing climate quite like this. Manufacturers are getting squeezed from every direction-tariffs, skyrocketing raw material costs, and relentless supply chain disruptions. The old playbook of raising prices to cover costs? That’s dead. Why? Because consumers are feeling the pressure too. A 2024 Nielsen report makes it clear: today’s shoppers are scrutinizing every dollar they spend, and brands that aren’t strategic about pricing risk losing market share fast. Here’s what I’m seeing from top CPG brands that get it: 1️⃣ Walmart is investing heavily in AI-driven pricing models to keep costs competitive-e-commerce now makes up 18% of total revenue. 2️⃣ PepsiCo is doubling down on pack-size innovation, offering smaller, affordable options to maintain volume without excessive discounting. 3️⃣ Luxury brands are using price elasticity models, testing demand thresholds before rolling out increases-avoiding consumer pushback. 4️⃣ Supply chain resilience is non-negotiable. Companies are shifting manufacturing away from China, despite short-term cost spikes, to avoid future geopolitical risks. The smartest brands aren’t just reacting. They’re rethinking. They’re moving toward Revenue Growth Management (RGM) frameworks that help them: ✅ Optimize pricing and promotions (because blanket price hikes are a losing game) ✅ Focus on margin-smart growth, not just revenue ✅ Leverage data analytics to make smarter, faster pricing decisions Brands that don’t evolve risk eroding profitability or pricing themselves out of the market. CPG leaders who master strategic pricing, operational efficiency, and consumer-driven value creation will own the future of this industry. Are you adjusting your strategy, or just reacting to rising costs? Because in 2025, only the most adaptable brands will win. #CPG #FMCG #PricingStrategy #RevenueGrowth #ConsumerGoods

Uncomfortable Truth for Pricing Strategy: Customer value isn't guesswork. Think pricing is all about costs? Think again. Online value research reveals what customers truly value and are willing to pay for. Here's what happens when companies embrace value-based pricing: → True Value Discovery A vending machine company discovered untapped value in their premium service and better-quality product. Result? $40M additional annual revenue with no loss in sales. → Customer Understanding One dashcam manufacturer found that women had completely different value drivers than men and were willing to pay 25-30% more. Understanding this doubled their projected sales. → Market Segmentation By matching prices to different market segments' willingness to pay, a corporate training provider drove 40% revenue growth. → Consistent Results Our client successes show the power of value-based pricing: - SaaS company raised prices 41% without losing customers - Streaming service doubled revenue through strategic pricing - Industrial components manufacturer grew sales 20% while raising prices 15% The truth? When you understand true customer value, pricing becomes your most powerful growth lever. Are you ready to let data drive your pricing decisions? #PricingStrategy #BusinessGrowth #ValueBasedPricing

"You're too cheap to be good." A lost client's final words before ghosting. That feedback blew my mind at first, but then I realized The brain sees low prices as danger signals I lost 80% of deals by pricing too low. Then brain science fixed it. What your brain needs to know about pricing psychology: Most think higher prices scare clients away. Science says the opposite is true. Your brain actually devalues what comes cheap. 7 Psychological Pricing Secrets of High Earners (use without being manipulative) 1/ Status Activation Cheap prices trigger survival mode. Premium prices activate achievement centers. Do This: ↳ Price slightly above market average ↳ Highlight exclusivity over accessibility 2/ Anchoring Effect First number sets the brain's reference point. This doubled my close rate instantly. Do This: ↳ Show premium tier first ↳ Compare to higher-cost alternatives 3/ Pain-Pleasure Switch Price resistance is really fear in disguise. Understanding this tripled my revenue. Do This: ↳ Address money fears directly ↳ Frame price as investment, not cost 4/ Value Stacking Multiple benefits beat single features. This turned my $2K offer into $20K program. Do This: ↳ Bundle complementary services ↳ Show combined value before individual pieces 5/ Scarcity Signals Limited spots trigger loss aversion. This works because brains hate missing out. Do This: ↳ Cap enrollment numbers clearly ↳ Set authentic registration deadlines 6/ Choice Architecture Too many options paralyze decision making This simplified my offers and boosted sales. Do This: ↳ Offer exactly three tiers ↳ Make middle option most attractive 7/ Risk Reversal Safety signals unlock the buying brain. I use this to remove final resistance. Do This: ↳ Offer strong but simple guarantees ↳ Show proof before they ask Smart Tips: ↳ Test one trigger weekly ↳ Track client objections ↳ Let pricing evolve naturally Truth is: Pricing isn't about the number. It's about the value story your brain tells. Master this, and you'll never discount again. P.S. Which pricing trigger resonates most with you? Let me know in the comments ⬇️ ➡️ Master the psychology of pricing here --> https://lnkd.in/gMcXA2-Y ------------------------------------------------- ♻️ Share to help others price with confidence. ➕ Follow Shannon for more brain-based biz growth.

Are discounts hurting your brand’s image, and performance? Before you start tossing around discounts just to get customers to buy, take a step back. Are you building a discount brand, or do you want to retain that premium image? I often see brands “train” their customers to only shop with them during heavy discount periods. This is NOT a winning strategy. Often times this dilutes margins and pulls revenue forward at the expense of predictable and stable 30/60/90 days sales. You also attract a different type of buyer (discount shopper), who usually has lower CLV and churns faster. Here’s how to get creative with your offers without slashing prices: 1. Test the Wording Instead of defaulting to percentage discounts, experiment with more strategic language in your offers. For example, if you’re a subscription business, try a "double hit" offer, where customers can bundle two subscriptions to save on shipping or receive a slight added value. This approach keeps the offer compelling without lowering your brand’s perceived value. Wording like “Double Your Order, Save on Shipping” gives the feel of an exclusive offer while still protecting margins. 2. Offer Freebies Instead For premium brands, offering a freebie can be far more powerful than offering discounts. At MANSSION, for example, free ring sizers are provided with each purchase, which adds value without devaluing the product. This approach makes customers feel they’re getting something special and unexpected. This tactic works especially well for building brand loyalty, as customers associate the “extra” with your brand’s generosity. 3. Escalate Offers for Retention Rather than immediately offering a discount to customers who haven’t repurchased, consider using a tiered incentive system. Start with a small offer, like free shipping or a minor add-on, and gradually escalate only if they remain inactive. This gives you a retention lever without conditioning customers to expect discounts right away. It also preserves the brand’s premium positioning, rewarding patience with stronger offers over time. 4. Focus on Value, Not Price Instead of simply lowering prices, focus on delivering additional value. Consider bundling products at a slightly reduced price, offering loyalty program perks, or providing exclusive early access to new products. The goal is to give customers a reason to keep buying from you without eroding your brand image. When value is defined by unique experiences or exclusive access, customers perceive your brand as generous and premium—not discounted. Key Takeaway: You don’t have to race to the bottom with discounts. A well-thought-out offer that preserves your brand’s integrity is far more powerful. Remember: Value > Price.

💸 67% of trade promotions don’t break even! Most brands are lighting money on fire. Nielsen reviewed over 800,000 UPCs & 92 million promo weeks to find out 67% don't break even. Let that sink in. In a world where budgets are tight and competition is fierce, trade spend should be your growth engine—not a black hole. 🧠 Here’s how to fix it: 🔍 1. Lead with Category Insights Retailers don’t care about your discount. They care about how it ladders into their category strategy. Start with: ✔ How your product fits unmet consumer needs ✔ Cross-comparison vs. category leaders ✔ Proof it drives basket size, frequency, or velocity 📊 2. Analyze Post-Promo Data Relentlessly Most brands run promotions → celebrate the lift → move on. Top brands reverse engineer success: ✔ Did sales spike and sustain after the promo? ✔ Was it incremental or just subsidized volume? ✔ Which retailer, region, or week drove the lift? 🎯 3. Build a Promotion Playbook (Not a Guessing Game) Document the ROI of each promo by tactic, account, and timing. Then scale what works. Kill what doesn’t. Think: ✔ “BOGO drove trial in Sprouts but flopped in Publix” ✔ “25% off drove repeat in Q2, but not Q4” ✔ “Velocity doubled only when supported with field execution” 💥 4. Layer Promotions with Execution & Storytelling The best promotions are activated, not just loaded. ✔ Field reps at Basemakers driving execution ✔ Promotional signage and end caps ✔ Demos or influencer tie-ins Promotions without execution = discounts with no ROI. 🎯 I'm currently building a proprietary approach that aligns promo planning with category strategy, retailer goals, & execution excellence! This will be exclusive to our Basemakers brand partners but I'll continue to share insights on Linkedin so be sure to follow me on here 📲 - Max Let’s turn your promotions into profit engines! -- ♻️ repost if you found this valuable (I'll post more insights like this!)

Spray n' pray discounting kills brands. But tons of them still do it. Every turnaround I’ve worked on has had the same initial marketing meetings. "OK, any ideas on how can we juice revenue?" People hem and haw, stare at each other a bit, then start throwing out discount ideas. Discounts on this? Discounts on that? "And then who gets the discount?" Everybody! This is the top marketing strategy for bankrupt DTC brands. Your first job as a turnaround marketer is to stop the spray and pray. How to fix it: Lean hard into a promotional strategy driven off customer behavior. By behavior, I mean Recency and Frequency (R and F). New customers who've just discovered the brand? They often don't need a discount. They need more things to buy, so show them the selection. At full margin. Old customers that aren’t buying anymore? Time to discount. Here's why this customer-centric approach works best: *Profitability: It's more profitable to promote based on customers' engagement than sending blanket promos out to your entire list. *Reduce email overload: By segmenting and treating different customers differently, you aren’t punching them in the face with all emails every day. Your emails become instantly more relevant, delivered more, read more. *Automation: R and F can be tracked in platforms like Klaviyo or Sendlane and via direct mail apps like PostPilot. Set certain rules + build your campaigns ahead of time. Then make money while you sleep. Test your offers over time. Maybe 10% is the sweet spot for detached customers. Or it's just free shipping. Or a free gift. Test it. But the goal is simple: Stop discounting too much and too generally. Focus on customer behavior and meet the customer where they are. BTW. . .   If you’re looking to test these sorts of customer-centric campaigns, direct mail is a great way to do it.    We're hitting all those customer-centric marks: *Profitable: Build campaigns based on engagement, which means you'll be allocating budget where you'll see strong ROIs. *Reduce email overload: Sending mailers based on specific triggers, with a 99.9% open rate. *Automated: Any direct mail campaign can be set and forgotten for hands-off revenue. DM me if you want to automate your revenue, too.

For over a decade, I've worked alongside mid-market CPG brands ($50MM - $1B revenue), and the story is often the same: smart people, great products, but struggling to maintain profitable growth in the face of relentless pressure. Trade promotions that don't deliver and subsidize baseline sales, competitor price wars, and the constant battle for margin across the value chain. It's exhausting, and frankly, it's often unnecessary. This isn't about "tough market conditions." It's about having the right system for Pricing and Revenue Growth Management Analytics and processes. It's about moving from reactive firefighting to a proactive, insights-driven strategy built on a foundation of integrated/harmonized data and some essential predictive analytics/scenario analyses (no fancy AI). 𝗛𝗲𝗿𝗲'𝘀 𝘁𝗵𝗲 𝗿𝗲𝗮𝗹𝗶𝘁𝘆 𝗜 𝘀𝗲𝗲 𝗺𝗼𝘀𝘁 𝗼𝗳𝘁𝗲𝗻: • 𝗣𝗿𝗼𝗺𝗼 𝗥𝗢𝗜? 𝗔 𝗕𝗹𝗮𝗰𝗸 𝗕𝗼𝘅. Many brands are flying blind, repeating promotions without knowing if they generate incremental profit. Retail buyers are often in the dark as well. We're talking about potentially wasting 10-20% of gross revenue on ineffective trade promotions. • 𝗖𝗼𝗺𝗽𝗲𝘁𝗶𝘁𝗼𝗿-𝗗𝗿𝗶𝘃𝗲𝗻 𝗣𝗿𝗶𝗰𝗶𝗻𝗴 𝗣𝗮𝗻𝗶𝗰. Reacting to every competitor's move leads to a race to the bottom. You need the proper Pricing RGM intelligence and scenario planning, not knee-jerk reactions. • 𝗧𝗵𝗲 𝗣𝗿𝗼𝗳𝗶𝘁 𝗣𝗼𝗼𝗹 𝗠𝘆𝘀𝘁𝗲𝗿𝘆. Who's benefiting from your promotions? Are you subsidizing your distributors or retailers? The lack of transparency here is a significant margin leak. It doesn't have to be this way. Here's how to take back control: 1. 𝗧𝘂𝗿𝗻 𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗮𝗻𝗱 𝗲𝘅𝘁𝗲𝗿𝗻𝗮𝗹 𝗗𝗮𝘁𝗮 𝗶𝗻𝘁𝗼 𝗔𝗰𝘁𝗶𝗼𝗻𝗮𝗯𝗹𝗲 𝗣𝗿𝗶𝗰𝗶𝗻𝗴 𝗮𝗻𝗱 𝗽𝗿𝗼𝗺𝗼 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀. Stop guessing. Implement a driver-based revenue and margin analysis to isolate the true impact of price, volume, mix, and competitive actions. Promo ROI capabilities enable you to reallocate spend to profitable promotions and strategically adjust pricing or product mix. 2. 𝗣𝗿𝗲𝗱𝗶𝗰𝘁, 𝗗𝗼𝗻'𝘁 𝗥𝗲𝗮𝗰𝘁. Near real-time price intelligence and scenario modeling are weapons against price wars. Model pricing impacts and make proactive decisions to protect your brand and bottom line. 3. 𝗠𝗮𝗽 𝘁𝗵𝗲 𝗣𝗿𝗼𝗳𝗶𝘁 𝗣𝗼𝗼𝗹 𝗟𝗮𝗻𝗱𝘀𝗰𝗮𝗽𝗲. It reveals exactly where value is being captured—by you, your distributors, or the retailers. It also helps with renegotiating trade terms. 4. 𝗣𝗿𝗶𝗰𝗲 𝗳𝗼𝗿 𝗩𝗮𝗹𝘂𝗲, 𝗡𝗼𝘁 𝗝𝘂𝘀𝘁 𝗩𝗼𝗹𝘂𝗺𝗲. Price-value mapping aligns your pricing with customer perception and willingness to pay. It's about reinforcing brand equity while maintaining profitability. Stop leaving your pricing to chance. I've created a 𝗖𝗣𝗚 𝗣𝗿𝗶𝗰𝗶𝗻𝗴 & 𝗥𝗚𝗠 𝗥𝗲𝘀𝗼𝘂𝗿𝗰𝗲 𝗛𝘂𝗯 specifically for mid-market CPG brands. It's packed with practical guides, tools, and frameworks you can use immediately to address the above pain points. The link to access is in the comments.

Competing on low price? That’s a race to the bottom. Instead, attract customers with a 𝑝𝑠𝑦𝑐ℎ𝑜𝑙𝑜𝑔𝑖𝑐𝑎𝑙 𝑝𝑟𝑖𝑐𝑒. Why? Let’s look at the reality: Amazon is a fiercely competitive marketplace. If you think you can win by simply having the lowest price, here’s what will happen: 1) You’ll crush your profit margins. 2) The customers you attract with low prices will jump ship as soon as they find a lower one. And business isn’t a joke. Every strategy needs to drive profitability. If you’re acquiring customers but losing money, what’s the point? So, how do you create a pricing strategy that pulls in customers while protecting your bottom line? The answer lies in using pricing tactics strategically: ➤ Dynamic Pricing Adjust prices based on demand, competition, and inventory levels in real-time. (Pro tip: Use tools that track real-time ASIN data. Here’s one to try: https://t2m.io/ZC5KWuye) ➤ Psychological Pricing Prices like $19.99 instead of $20 trigger the perception of getting a deal. ➤ Competitive Pricing Benchmark against competitors to stay relevant without slashing your profit margins. ➤ Penetration Pricing Start low to capture market share, then adjust as your brand gains traction. ➤ Value-Based Pricing Set prices based on the perceived value to the customer—not just the cost. ➤ Keystone Pricing Double your wholesale cost to set a standard retail price. ➤ Bundle Pricing Combine multiple products at a discounted rate to increase perceived value and move inventory faster. ➤ Discount Pricing Offer temporary price reductions to clear stock or boost sales. ➤ Loss Leader Pricing Price certain products at a loss to attract customers who will make additional, profitable purchases. ➤ Skimming Pricing Begin with a high price and gradually lower it as demand shifts. ➤ Premium Pricing Maintain higher prices to signal exclusivity and premium quality. ➤ Cost-Plus Pricing Add a fixed markup to the cost of goods to ensure a stable profit margin. The key? Leverage these tactics strategically. Every pricing strategy should align with your business goals and attract the right kind of customers—the profitable ones. Let me know if there’s a strategy you want to dig into further! P.S. We’re launching an exclusive program for established brands ready to dominate Q4 with data-driven strategies. Message me ‘QUALIFY’ to see if you’re a fit. As trusted partners of Alibaba and Amazon, we’ve helped sellers and agencies generate over $200 million in revenue. Are you next?

In 2012, JC Penney made one of the most expensive marketing mistakes in retail history... they eliminated all sales and coupons in favor of "everyday low prices." The result? They lost $985 million in just one year. The strategy came from their new CEO Ron Johnson (former Apple retail chief) who believed constant promotions were training customers to only buy when items were discounted. His solution seemed logical. But humans aren't logical... we're psychological. Johnson ignored these critical behavioral principles: 1️⃣ Transaction Utility: The dopamine hit we get from feeling like we scored a deal. When you see "70% OFF" your brain gets a reward that flat pricing can't deliver. 2️⃣ Price Anchoring: We need reference points to determine value. When you see "$100 NOW $40" your brain uses $100 as the anchor. Without it, the exact same products were perceived as cheaper and lower quality. 3️⃣ Loss Aversion: We feel losses about twice as strongly as equivalent gains. By removing coupons, JC Penney's loyal customers felt they were losing something valuable, even though prices were technically "fairer." 4️⃣ The IKEA Effect: We value things more when we put effort into obtaining them. Searching for deals and clipping coupons creates satisfaction that "everyday low prices" eliminates. 5️⃣ Segmentation Through Effort: The old strategy brilliantly served both price-sensitive and convenience-focused customers. Deal hunters would use coupons while others paid full price. The new approach alienated both segments. The results were catastrophic: ❌ Sales plummeted 25% ($4.3B in revenue) ❌ Store traffic dropped 13% ❌ Stock collapsed from $43 to under $18 ❌ Johnson was fired after just 17 months When JC Penney finally restored their old pricing in 2013, they released an apology video saying: "We learned a very simple thing... to listen to you." Their first promotion after reinstating discounts led to a 10% increase in store traffic almost overnight. When they brought back coupons customers literally cheered in the aisles. Here's the incredible irony: Research later showed that after reinstating the old model, JC Penney was actually charging HIGHER prices than during the "everyday low price" era. But because they framed them as discounts from higher anchors, customers were happier paying more. That's the remarkable power of behavioral economics in action. People don't just want fair prices... they want the emotional reward of feeling like they outsmarted the system and got a special deal. Here's the thing... people don't buy based on logic. They buy based on emotion and psychology. Ignore this at your own peril. What other companies do you think are making similar mistakes right now?