Before acquiring a product—or a solution—it is often useful to compare how well it meets customer needs and expectations relative to its price. The Price-Value Map is a tool designed for this purpose. It enables the comparison of these two dimensions—value and price—by plotting them on a graph with dedicated axes.
In the case of complex purchases, sophisticated scorecards are often developed to evaluate and compare solutions from different suppliers. Customers may also evaluate and rank solutions based on their preferences and needs. In every case, perceived value is measured, allowing solutions to be compared against their price before making a decision. This is precisely what the Price-Value Map enables.
This tool is naturally used by customers, but it is also widely employed by marketing and sales teams for various purposes. For sales, it serves as a tactical tool to assess and compare competitive offerings with their own, helping to determine sales tactics, including pricing strategies. For marketing, it provides an approach for considering long-term positioning across their own range of solutions, as well as competitive offerings for all segments served by the company.
Price and value are sometimes confused with each other. In some cases, value can even be translated into monetary terms, but fundamentally, value refers to the comparison and ranking of solutions, where multiple factors are considered. There is no need to assign a monetary value to the value index, as doing so may be counterproductive. It can lead to the wrong belief that the value of certain features and capabilities can be directly translated into price. Value assessment is neither linear nor additive. Adding features and capabilities to solutions does not always result in additional value, as some features may hold no value for certain customer segments.
Hence, value, even with scorecards or qualification methods, remains subjective and can fluctuate rapidly depending on sales efforts to communicate the solution’s benefits and differentiating factors compared to competitors.
On the other hand, price is a company decision and is typically considered objective. However, customers perceive costs based on their own criteria. For some, the acquisition cost of a solution is not evaluated solely by its price but rather in terms of the Return on Investment (ROI) it delivers. Additionally, the residual value of the solution after a few years may also be a factor. Therefore, the price dimension of a solution can, in some cases, be seen as subjective. For this reason, ‘price’ is often replaced by ‘perceived price’ to emphasize that price evaluation depends on the customer’s perception.
For companies, understanding customers’ perceived value and perceived price is absolutely key to ensuring proper market positioning, go-to-market strategies, and delivering effective communication.
The Price-Value Map is a crucial tool for marketers, ensuring that solutions are properly aligned with market segments and remain competitive in the marketplace. It can be applied in various situations, from optimizing current offerings to developing future market solutions.
Positioning Current Solutions and Assessing Competitive Offerings
Price-Value Mapping can be used to assess the relative strengths and weaknesses of solutions for each market segment. When used effectively, it helps identify new, optimal positioning through packaging and pricing strategies. Communication efforts can be optimized to highlight key strengths and differentiation factors compared to competitors.
For Future Solutions
Mapping current offerings is a valuable first step before considering future landscapes.
With Price-Value Mapping, marketing teams can determine the best course of action to position offerings in both the short and long term. Additionally, scenario planning can help anticipate competitive events and devise appropriate responses.
For sales teams working on complex projects, understanding the customer’s perception of the value of their solutions, as well as those of competitors, offers a significant advantage. One of the sales team’s primary roles is to advocate for the strengths of their solutions and how well they meet the customer’s needs. To do this effectively, it is crucial to understand what the customer values so that solution capabilities can be demonstrated appropriately. The Price-Value Map becomes a tactical tool for identifying the arguments that will best differentiate the offering from competitors and counter competitive claims.
Timing and use in Sales
This tool must be used at the right time in the sales process. Early on, it is often helpful to determine the customer’s budget in order to avoid proposing products that exceed their price range. Deals are frequently lost when the price of the desired product is out of reach. Sales teams can leverage offerings to emphasize unique capabilities, especially when competitors lack certain features. Additionally, the final round of price negotiations requires careful strategy; reducing prices without compromising the configuration is key to winning deals without losing the value proposition.
Price-Value Mapping is most effective when applied to a specific customer segment or, in the case of large deals in certain markets, to individual customers.
Perceived value must be assessed accurately. Using a scorecard that reflects the values of the customer segment under consideration and incorporates Voice of the Customer (VOC) data is a good approach. However, the risk with scorecards is that they may imply an additive and linear evaluation of features and capabilities, which does not reflect reality. Nonetheless, scorecards can help identify relevant factors to consider and leverage. In short, the scorecard can be refined over time to better align with how the customer segment evaluates solutions.
Another approach is to use customers’ own evaluation tools, as their methods for assessing and comparing solutions are often unique. By building long-term collaborations with customers, you can gain insights into their evaluation methods and identify which features might be over- or undervalued.
Focus groups can also help in evaluating and comparing solution offerings. Any approach that utilizes customer input should be welcomed.
Using the Price-Value Map to identify which arguments to highlight is important. Some features may increase competitiveness while also allowing for a higher price and margin. These tactics should be applied mindfully.
Consider price with the most appropriate definition for your market segments. Is the purchase price or the running cost more important? Is the total cost of ownership a key factor? Should the potential resale value be considered, especially if a higher resale price makes the investment more attractive?
Regular team meetings should be held to review product positioning assessments and adjust sales pitches accordingly. Ensure that pricing effects are captured, and sales tactics are considered simultaneously. Adjust go-to-market strategies based on both your own and competitors’ moves.
The Price-Value Map is a valuable tool used by customers to maximize their understanding of the market offerings and make optimal decisions. 
For companies—whether used by marketers or sales teams—it is essential for correctly positioning offerings and delivering the most effective sales arguments.
The Price-Value Map plays an important role in supporting these decisions, both for customers and for companies.
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