Nous partnered with a leading insurance company to identify the ideal price point for a range of new products and understand any potential impacts on existing products.
A pricing strategy for a new home repair service
Nous initially worked with the company to shape and co-design an innovative home repairs and maintenance service. Following this, the company sought to better understand the ideal price point for each product, and understand any potential cannibalisation that could impact other existing products.
Nous’ previous investigation with the company had established that the market is price sensitive, and highly fragmented. Success in the market required a deep understanding of the customer’s willingness to pay and the relative value of benefits from the service. We identified the most likely customers based on previously defined personas, and worked with potential customers to determine the ideal pricing strategy for a representative set of different home repair services that could be included in the offer at launch.
The process involved:
We compared different possible pricing models, including those used by other providers, then integrated our findings into the existing business case for implementation.
We ascertained the preferred model and proposed three different versions of that model, highlighting the one most preferred by the market.
The findings from the research were applied to the financial model to improve the accuracy of the revenue projections and the net present value in the business case. This allowed the client to confidently progress to the pilot launch of the service with the approval of Board members.
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