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Successful New Product Pricing Practices: A Contingency Approach

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Abstract

The purpose of this study is to examine the success of new product pricing practices and the conditions upon which success is contingent. We distinguish three different pricing practices that refer to the use of information on customer value, competition, and costs respectively. Following Monroe's (1990) price discretion, we argue that the success of these practices is contingent on relative product advantage and competitive intensity. The hypotheses are tested on pricing decisions for new industrial products. Our results show that there are no general “best” or “bad” practices, but that a contingency approach is appropriate. These results may help reduce the complexity that managers experience in pricing new products.

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Authors and Affiliations

  1. Wageningen University and Agricultural Economics Research Institute in The Hague, The Netherlands

    Paul Ingenbleek

  2. Goizueta Business School, Emory University, Atlanta, USA

    Marion Debruyne

  3. Vrije Universiteit, Amsterdam, The Netherlands

    Ruud T. Frambach

  4. Faculty of Economics and Business Administration at Tilburg University, The Netherlands

    Theo M. M. Verhallen

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  1. Paul Ingenbleek
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  2. Marion Debruyne
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  3. Ruud T. Frambach
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  4. Theo M. M. Verhallen
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Ingenbleek, P., Debruyne, M., Frambach, R.T. et al. Successful New Product Pricing Practices: A Contingency Approach. Marketing Letters 14, 289–305 (2003). https://doi.org/10.1023/B:MARK.0000012473.92160.3d

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