What is the first step in EVC analysis and pricing?

The first step in the Economic Value to the Customer (EVC) analysis and pricing process is to identify the next best alternative product price. This step is crucial because understanding the price of the next best alternative helps establish a reference point for customers. It provides insight into how your product's value compares within the market landscape and how much customers might be willing to pay based on their options.

Knowing the price of the next best alternative allows marketers to assess the competitive environment and determine how their offering can provide additional value that justifies a higher price. This understanding serves as a foundation for the subsequent steps in the EVC analysis, where differentiating factors are identified, value calculations are made, and marketing strategies are developed. By starting with the next best alternative price, marketers can effectively target their pricing strategy to create a compelling value proposition for their product.