Pricing value and selling value : A view on individuals within organizations

Abstract: At the heart of long-term success lies firms’ ability to provide customers with products and services that enable customer value creation and firms’ ability to capture value in the form of profits. To this effect, managers and salespeople have an impact on a firm’s value creation and value capture ability through their pricing and selling behavior and decisions. Value-based pricing and value-based selling are two practices that allow firms to create customer value and capture value for the firm that have witnessed a recent surge in interest. Despite this growing interest, many investigations reside on the firm level, and thus, factors influencing individual managers and salespeople in the usage of both practices have been rather overlooked. The purpose of this licentiate thesis is to investigate factors influencing those individuals’ practice of pricing and selling value.The research is based on three articles that investigate pricing and selling value from different vantage points. The articles include a literature review that shows developments in and the current state of pricing strategy research; a study investigating the effects of managerial personality on the usage of value-based pricing for a new industrial service; and a survey that explores salesperson’s usage of value-based selling in the steel industry.The thesis finds that pricing strategy research increasingly considers customer value by investigating strategies grounded in value-based pricing practices and increasing focus on customer value through more research on services. Further, the magnitude of internal and external factors influences managers and salespersons’ use of value-based pricing and selling. Finally, the research outlines approaches for managers responsible for pricing and selling to deal with the effects of the identified factors on value-based pricing and selling.The research contributes with an exploration and assessment of factors influencing managers and salespeople in using value-based pricing and selling and discusses how firms can deal with these factors. In doing so, the research contributes to pricing and selling literature and the evolving focus on individual aspects in pricing and selling value.