Key Pricing Terms Clearly Explained
A growing collection of pricing and commercial strategy definitions designed to make complex topics easier to understand.
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What Is Rate Card Pricing
Rate card pricing publishes a standard price per unit...
Read definitionWhat Is a Price War
A price war is a sequence of reciprocal price...
Read definitionWhat Is Switching Costs
Switching costs are everything a customer must spend to...
Read definitionWhat Is Minimum Order Quantity
Minimum order quantity, or MOQ, is the smallest amount...
Read definitionWhat Is Captive Pricing
Captive pricing sets a low price on a core...
Read definitionWhat Is a Two-Part Tariff
A two-part tariff charges a fixed fee for access...
Read definitionWhat Is Price Volume Mix Analysis
Price volume mix analysis, or PVM, decomposes a change...
Read definitionWhat Is Price Testing
Price testing is the practice of gathering evidence on...
Read definitionWhat Is a Price Escalation Clause
A price escalation clause is a contract provision that...
Read definitionWhat Is Pass-Through Pricing
Pass-through pricing charges the customer for a cost the...
Read definitionWhat Is Price Harmonization
Price harmonization is the deliberate alignment of prices across...
Read definitionWhat Is Price Architecture
Price architecture is the structural logic beneath a company’s...
Read definitionWhat Is Cost to Serve
Cost to serve is the full expense of delivering...
Read definitionWhat Is Contract Pricing
Contract pricing is the practice of fixing agreed prices...
Read definitionWhat Is a Volume Discount
A volume discount is a price reduction a seller...
Read definitionWhat Is a Price Book
A price book is the authoritative record of what...
Read definitionWhat Is a Discount Policy
A discount policy is the set of rules that...
Read definitionWhat Is Net Price
Net price is the amount a customer is invoiced...
Read definitionWhat Is Contribution Margin
Contribution margin is the revenue that remains from a...
Read definitionWhat Is Customer Lifetime Value
Customer lifetime value, often shortened to LTV or CLV,...
Read definitionWhat Is Net Revenue Retention
Net revenue retention, or NRR, measures how much recurring...
Read definitionWhat Is a Deal Desk
A deal desk is the cross-functional function that reviews,...
Read definitionWhat Is Configure Price Quote
Configure price quote, usually shortened to CPQ, is the...
Read definitionWhat Is Rebate Management
Rebate management is the set of processes a company...
Read definitionWhat Is Price Variance
Price variance is the spread in prices a company...
Read definitionWhat Is Price Fencing
Price fencing is the use of rules, conditions, and...
Read definitionWhat Is List Price
List price is the published, standard price of a...
Read definitionWhat Is Price Localization
Price localization is the practice of setting different prices...
Read definitionWhat Is Grandfathered Pricing
Grandfathered pricing is the practice of letting existing customers...
Read definitionWhat Is a Value Metric
A value metric is the unit a company charges...
Read definitionWhat Is a Hybrid Pricing Model
A hybrid pricing model combines two or more pricing...
Read definitionWhat Is Outcome-Based Pricing
Outcome-based pricing ties what a customer pays to the...
Read definitionWhat Is Economic Value to the Customer
Economic value to the customer, or EVC, is the...
Read definitionWhat Is the Gabor-Granger Method
The Gabor-Granger method is a pricing research technique that...
Read definitionWhat Is the Van Westendorp Price Sensitivity Meter
The Van Westendorp Price Sensitivity Meter is a survey-based...
Read definitionWhat Is Price Benchmarking
Price benchmarking is the practice of comparing your prices...
Read definitionWhat Is Markup Pricing
Markup pricing is a method that sets price by...
Read definitionWhat Is Decoy Pricing
Decoy pricing is a packaging tactic that introduces a...
Read definitionWhat Is Pricing Analytics
Pricing analytics is the use of transaction, customer, and...
Read definitionWhat Is a Pricing Strategy Consultant
A pricing strategy consultant is a specialist who helps...
Read definitionWhat Is a Price Increase Strategy
A price increase strategy is the structured plan a...
Read definitionWhat Is Price Realization
Price realization is the percentage of list price a...
Read definitionWhat Is Pricing Power
Pricing power is a company’s ability to raise prices...
Read definitionWhat Is Margin Erosion
Margin erosion is the gradual decline of a company’s...
Read definitionWhat Is Discount Management
Discount management is the set of policies, approvals, and...
Read definitionWhat Is a Price Waterfall
A price waterfall is an analytical framework that traces...
Read definitionWhat Is Pocket Price
Pocket price is the revenue a company actually keeps...
Read definitionWhat Is Revenue Leakage
Revenue leakage is the gap between the revenue a...
Read definitionWhat Is Enterprise Pricing
Enterprise pricing is a custom, negotiated pricing approach used...
Read definitionWhat Is Per-User Pricing
Per-user pricing is a model that charges customers based...
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