In an insightful conversation with Kai Markus-Mueller, Professor of Consumer Behavior and Director of Pricing Research, the dialogue delved into the fascinating world of pricing and its significant impact on profit margins. Kai emphasized the measurable aspect of pricing, highlighting its power as the most substantial profit lever among variables like costs and volume. The discussion also tackled the challenges associated with adjusting prices, underscoring the need for market research to navigate these risks successfully.
Kai introduced neuropricing, an innovative approach he developed that combines neuroscience and cognitive psychology to understand consumers' subconscious valuations. This method employs technologies like EEG and reaction time measurements to detect the brain's response to price and product pairings, revealing the consumers' true willingness to pay without direct questioning. This technique, adaptable for online use, enables the analysis of hundreds of subjects, providing a robust basis for demand modeling and revenue forecasting.
The conversation further explored the trend towards online market research methodologies, which offer scalability and efficiency compared to traditional lab-based approaches. Kai shared his journey of creating 'The Invisible Game,' a book co-authored with Gabriel Rebock, aimed at applying consumer psychology insights to professional B2B sales. The discussion concluded with Kai advising aspiring market researchers to start their careers on the agency side to gain a broad experience across various clients and industries before potentially moving to in-house roles.
This engaging interview offered a deep dive into the intersection of pricing, consumer psychology, and market research, showcasing Kai's contributions to the field and his vision for its future direction.
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