Pricing 360°: A Paradigm Shift in the Way Pricing Is Managed in the Digital Economy

Abstract

Digitalization and marketing technologies have made it possible to overcome some barriers to pricing – a multidisciplinary field between marketing, finance and IT – and have set the stage for a paradigm shift in the pricing profession. Value creation, the pricing process, and price communication have been transformed by innovative business models and advanced algorithmic and human–machine solutions. This chapter synthesizes the literature to date and provides a comprehensive framework for an all-encompassing 360° pricing approach that broadens the understanding of pricing in the context of digital business across all steps of the price management process. Starting from product attributes and motivational beliefs in consumers' value assessment and adoption of (technological or digital) products or services, new business models and pricing models emerge in the digital economy, human–machine solutions for price implementation and repricing are increasingly applied, and price search and communication take place through a variety of digital communication channels. Each stage of this framework discusses concrete examples, highlighting the freemium strategy, the subscription model, price tracking and repricing tools, and digital price information channels such as e-commerce, marketplace, or price comparison platforms. The implications for price management in a digital, technology-driven landscape are discussed from the executive level to the analyst level.

Citation

Erdmann, A. (2024), "Pricing 360°: A Paradigm Shift in the Way Pricing Is Managed in the Digital Economy", Matosas-López, L. (Ed.) The Impact of Digitalization on Current Marketing Strategies (Marketing & Technology: New Horizons and Challenges), Emerald Publishing Limited, Leeds, pp. 79-96. https://doi.org/10.1108/978-1-83753-686-320241005