Educational services pricing strategy
PE-owned company tasked with very ambitious target set by the Board — increase revenue 40% within 3 years.
Main challenges: Unclear path to further growth beyond historical/organic; Suboptimal bundling and discounting models; Lack of pricing discrimination; Limited understanding of customer and non-customer preferences
HOLISTIC SUITE OF PRICING LEVERS
Increase number of customers by lowering the barriers to entry. Designed a discounting/promotion structure to win over underserved customer segments. Designed a per-pupil pricing model to increase perceived attractiveness of the proposition by certain customer groups
Increase revenue per customer: List price optimisation — designed a schedule of targeted price increases based on varied customer (school) sizes; Increasing service penetration — designed a bundling approach to encourage customers to uptake products and hence increase spend
REVENUE GROWTH Full potential impact from new pricing levers estimated at 45% revenue increase over a 3-year period on top of the expected 10% organic growth.