PRICING STRATEGY

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SYNOPSIS
Need to evaluate the best pricing strategy for a product? Our Pricing Strategy
template includes the top 5 pricing tools to evaluate cost, feature, market share,
competition, and customer price sensitivity to pick the right price for the right
market. Adjust and analyze pricing to maximize profit margin for any product
based on key metrics such as LTV, CAC, COGS, market share gained, or
customer price perception.

EXPLAINER

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Errors and omissions liability (E&O): You Exec LLC makes no guarantee that the formulas, models, analysis, financial projections,
estimates, graphs, reports, numbers, and any derivatives sourcing from this model are free of errors and omissions. Our financial modelers
have audited this model to the best of their capabilities, yet You Exec LLC assumes no liability for erroneous outcomes derived from this
financial model.

Copyright © You Exec LLC. All rights reserved.

TABLE OF CONTENTS

Sheet 1 Cover

Sheet 2 Table of contents

Sheet 3 Fields

Sheet 4 Competitor comparison

Sheet 5 Cost-based pricing

Sheet 6 Price sensitivity

Sheet 7 Freemium conversion

Sheet 8 Market penetration

COLOR KEY
Types Example Description
User inputs $3,400 User inputs
Calculations $3,400 Formula results
Results
Good results $3,400 Favorable outcomes
Bad results $3,400 Unfavorable outcomes
FIELDS
Smart Company: Pricing Strategy

CUSTOMIZABLE FIELDS

GENERAL INPUTS
Report name Pricing Strategy
Company name Smart Company

PRICE ANALYSIS
Product name Our new phone X
Price $650
Total fixed cost $540,000,000

KOTLER'S MATRIX
Product quality Product price
All All
Low Low
Medium Medium
High High
NOTES

General inputs applied on all pages of the spreadsheet

"Total fixed cost": Needed to calculate the break-even point

"Kotler's Matrix": Used on competitive landscape tab

Limit for the maximum number of inputs. Anything under the line will be ignored.
COMPETITOR COMPARISON
Competition-based price sensitivity

COMPETITIVE LANDSCAPE CHARTS

Competitor perceptual map

High
Quality

Medium

Low

Low Medium High

Price

COMPETITOR COMPARISON TABLE

Competitor name Product name Price ($) Product quality

Your product Our new phone X $650 High

 Apple iPhone 14 $799 High

Samsung Samsung Galaxy S22 $699 Medium

Google Pixel 7 Pro $599 Low
 Kotler's matrix
Product price
Low
Super high value

High
Good value
Product quality

Medium

Economy
Low

Product price level Units sold (#) Market share (%) Price strategy

Medium 5,000,000 5%
High 50,000,000 53%

High 25,000,000 26%

Low 15,000,000 16%
 Product price
Medium High
High value Premium

Mid value Overarching

False economy Rip-off

Compared to Compared to
Revenue ($)
competition (%) competition ($)

-7% ($49) $3,250,000,000

14% $100 $39,950,000,000

0% $0 $17,475,000,000
-14% ($100) $8,985,000,000
NOTES

"Perceptual map": area of circle represents market share per each competitor.

X (price)

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COST-BASED PRICING
Cost sensitivity

PRICE COMPARISON TABLE

Strategy type Scenario Price ($) Cost ($)

Current scenario $650 $507

Fixed dollar increase

Scenario A1 $675 $507

Scenario A2 $700 $507

Scenario A3 $725 $507

Scenario A4 $625 $507

Scenario A5 $600 $507

PRICE COMPARISON TABLE

Strategy type Scenario Price ($) Cost ($)

 Current scenario $650 $507

Percent-based increase

Scenario B1 $780 $507

Scenario B2 $845 $507

Scenario B3 $922 $507

Scenario B4 $563 $507

Scenario B5 $545 $507

Gross margin ($) Gross margin (%) Units sold (#) Units to break-even (#)

$143 22% 5,000,000 3,776,224

$168 25% 4,800,000 3,214,286

$193 28% 4,700,000 2,797,927

$218 30% 4,500,000 2,477,064

$118 19% 5,400,000 4,576,271

$93 16% 5,800,000 5,806,452

Gross margin ($) Gross margin (%) Units sold (#) Units to break-even (#)
$143 22% 5,000,000 3,776,224

$273 35% 4,000,000 1,978,022

$338 40% 3,600,000 1,597,633

$415 45% 3,100,000 1,301,775

$56 10% 6,400,000 9,585,799

$38 7% 6,900,000 14,150,465

 Revenue ($) Total cost ($) Margin ($)

$3,250,000,000 $3,075,000,000 #NAME?

#NAME?

$3,240,000,000 $2,973,600,000 #NAME?

$3,290,000,000 $2,922,900,000 #NAME?

$3,262,500,000 $2,821,500,000 #NAME?

$3,375,000,000 $3,277,800,000 #NAME?

$3,480,000,000 $3,480,600,000 #NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

Revenue ($) Total cost ($) Margin ($)

$3,250,000,000 $3,075,000,000 #NAME?

#NAME?

$3,120,000,000 $2,568,000,000 #NAME?

$3,042,000,000 $2,365,200,000 #NAME?

$2,857,636,364 $2,111,700,000 #NAME?

$3,605,333,333 $3,784,800,000 #NAME?

$3,761,612,903 $4,038,300,000 #NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?

#NAME?
NOTES

Valid scenarios

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PRICE SENSITIVITY
Pricing landscape

PRICING DATA TABLE

Date Historical price ($) Cost ($) Gross margin ($)

12/18/2022 $650 $507 $143

01/18/2023 $625 $507 $118

02/18/2023 $600 $507 $93

03/18/2023 $575 $507 $68

04/18/2023 $550 $507 $43

05/18/2023 $560 $507 $53

06/18/2023 $570 $507 $63

07/18/2023 $580 $507 $73

08/18/2023 $590 $507 $83

09/18/2023 $600 $507 $93

10/18/2023 $610 $507 $103

Gross margin (%) Units sold (#) Revenue ($) Marketing spend ($)

22% 5,000,000 $3,250,000,000 $18,000,000

19% 5,200,000 $3,250,000,000 $20,800,000

16% 5,400,000 $3,240,000,000 $19,440,000

12% 5,600,000 $3,220,000,000 $18,480,000

8% 5,800,000 $3,190,000,000 $18,560,000

9% 5,550,000 $3,108,000,000 $19,425,000

11% 5,300,000 $3,021,000,000 $19,610,000

13% 5,050,000 $2,929,000,000 $18,180,000

14% 4,800,000 $2,832,000,000 $18,720,000

16% 4,550,000 $2,730,000,000 $13,650,000

17% 4,300,000 $2,623,000,000 $13,760,000

 Customer Lifetime- Customer Acquisition
Profit ($) Price strategy
Value (LTV) ($) Cost (CAC) ($)

#N/A $750 $4 Skimming

#N/A $870 $4 Skimming

#N/A $780 $4 Skimming

#N/A $870 $3 Skimming

#N/A $700 $3 Skimming

#N/A $840 $4 Penetration

#N/A $760 $4 Penetration

#N/A $770 $4 Penetration

#N/A $600 $4 Penetration

#N/A $830 $3 Penetration

#N/A $840 $3 Penetration

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A

#N/A #N/A
#N/A #N/A

#N/A #N/A

#N/A #N/A

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#N/A #N/A

#N/A #N/A
NOTES

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FREEMIUM CONVERSION
Feature sensitivity

FREEMIUM CONVERSION TABLE

Feature name Free users gained (#) Conversion rate (#) Conversion rate (%)

Feature 1 1,000 15 1.5%

Feature 2 1,200 30 2.5%

Feature 3 1,400 45 3.2%

Feature 4 800 50 6.3%

Feature 5 900 40 4.4%

Feature 6 1,500 96 6.4%

Feature 7 2,000 131 6.6%

Feature 8 720 18 2.5%

#N/A

#N/A
Price ($) Revenue ($) Marketing spend ($) Profit ($)

$500 $7,500 $18,000 $750

$450 $13,500 $21,000 $16,500

$400 $18,000 $25,000 $31,250

$385 $19,250 $15,000 $47,500

$396 $15,840 $16,000 $34,000

$250 $24,000 $24,000 $96,000

$580 $75,980 $31,000 $132,750

$850 $15,300 $14,000 $8,500

Customer Acquisition Customer Lifetime-
Cost (CAC) ($) Value (LTV) ($)

$18 $1,250

$18 $1,250

$18 $1,250

$19 $1,250

$18 $1,250

$16 $1,250

$16 $1,250

$19 $1,250
NOTES

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Limit for the maximum number of inputs. Anything under the line will be ignored.
MARKET PENETRATION
Market share sensitivity

STRATEGIES OVER TIME

Phase strategy Phase name Date Phase pricing ($)

Skimming

Phase 1 12/02/2022 $620

Phase 2 03/02/2023 $607

Phase 3 06/02/2023 $593

Phase 4 09/02/2023 $587

STRATEGIES OVER TIME
Phase strategy Phase name Date Phase pricing ($)
Penetration

Phase 1 12/02/2022 $583

Phase 2 03/02/2023 $592

Phase 3 06/02/2023 $607

Phase 4 09/09/2023 $620

Cost ($) Gross margin ($) Gross margin (%) Units sold (#)

$507 $113 18% 5,000,000

$507 $100 16% 9,000,000

$507 $86 15% 12,000,000

$507 $80 14% 10,000,000

Cost ($) Gross margin ($) Gross margin (%) Units sold (#)

$507 $76 13% 5,000,000

$507 $85 14% 8,000,000

$507 $100 16% 7,300,000

$507 $113 18% 3,500,000

 Revenue ($) Market share (%)

$3,100,000,000 5%

$5,463,000,000 6%

$7,116,000,000 7%

$5,870,000,000 6%
 Revenue ($) Market share (%)

$2,915,000,000 3%

$4,736,000,000 4%

$4,431,100,000 4%

$2,170,000,000 2%
NOTES

"Skimming": this strategy starts with a high and gradually goes lower.

Used to enter and gain market share.

Examples include: Smart TVs, laptops, cars hardware.

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"Penetration": this strategy starts with a very low price to penetrate the market.

Once the market is penetrated and moat is created, then you increase the price to cover costs and make billions.

Examples include: Apple, Google, Amazon, Uber.

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BENEFITS

Below are all the benefits included in the complete

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our entire library of business resources.

The complete version includes charts to

visualize the break-even analysis of each
price-point to compare against one
another, along with two charts to
compare individual scenarios side by
side.
The complete version of the "Price
sensitivity" tab includes 10 charts for
each column on the pricing table to
visulaize how top metrics such as LTV,
CAC, historic price, and cost change
over time.

The complete version of the "Freemium

conversion" tab includes ten charts to
visualize how the number of active
users, conversion rate, and eight other
key metrics change across each feature.

The complete version of the "Market

penetration" tab includes charts to
visualize market share gained, price, and
number of units sold over time to
visualize how your strategies compare to
one another.
With over 25 additional charts to
compare how different price points
impact profit margin, customer price
sensitivity, freemium conversion, and
market share gained, you have
everything you need to inform your
product pricing strategy.

Gain all these benefits when you join today... Get spreadsheet

Errors and omissions liability (E&O): You Exec LLC makes no guarantee that the formulas, models, analysis, financial projections,
estimates, graphs, reports, numbers, and any derivatives sourcing from this model are free of errors and omissions. Our financial
modelers have audited this model to the best of their capabilities, yet You Exec LLC assumes no liability for erroneous outcomes derived
from this financial model.

Copyright © You Exec LLC. All rights reserved.