Physical testing instruments, medical equipment

Medical Diagnostic Technology Supplier Adopts Value-Based Pricing Strategy for New Product

The Challenge: An innovative molecular diagnostic technology supplier was preparing to launch a new product and identified the need for a consistent global pricing strategy. The company engaged Blue Canyon Partners to determine a pricing model and how it would position the company to be appropriately rewarded for the benefits the new product provided.

Assessment: Blue Canyon performed an in-depth strategic market analysis across ten countries to better understand how the market perceived the value of the new product. The project team learned that the market was receptive to a value-based pricing model if there was proof of financial savings and better patient outcomes. Market participants had stringent demands for evidence to support this pricing model.

Strategic Solution: Blue Canyon proposed a value-based pricing strategy that was built on the key value drivers identified in the marketplace and encouraged the company to develop the clinical and economic proof to support the strategy. The project team clarified how the company should compare its solution to competitive products in the marketplace, as well as provided guidelines on a segmenting and targeting strategy that would support the value-based pricing approach.

Results: The client has adopted the guiding principles proposed by Blue Canyon to direct its future pricing decisions. It intends to implement once the product is launched. As a result, the company is projected to command a significant price premium in the marketplace with the economic proof needed to demonstrate the value to customers to justify the premium.

Related Insights

Medical Supplies Company

Medical Supplies Company Introduces Higher Value Offerings through Segmentation and Pricing Strategy

Challenge: A global medical supplies company was seeking to obtain sustainable bottom line growth by changing health care perceptions and introducing higher value offerings to...

Combating Downward Pricing Pressures with a Value-Based Approach

Challenge: A Tier 1 Automotive Supplier has historically enjoyed premium pricing for its products, but in recent years has felt heavy downward pricing pressure due...
aerial view of heavy traffic on the bridge approach

A Supplier to the Automotive Industry Employs a Value-Based Pricing Model to Grow its Global Position

The Challenge: A leading supplier to the automotive industry needed to grow its global position in the marketplace, utilizing a new technology for its tier...