Competitive Intelligence & Price Benchmarking Flashcards
6 cards from real CPP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Competitive Intelligence & Price Benchmarking flashcards as text
A company is a 'price follower.' What does this mean in competitive strategy terms?
Answer: It adjusts its prices in response to changes made by the market price leader
A price follower lacks sufficient market power to set prices independently and instead reacts to the pricing moves of the dominant competitor.
The 'price sensitivity' of a market segment is MOST directly measured by:
Answer: Price elasticity of demand for the segment
Price elasticity of demand (% change in quantity / % change in price) directly quantifies how responsive a segment's purchasing behavior is to price changes.
When performing a competitive win/loss analysis, which factor MOST indicates that pricing was the primary reason for a lost deal?
Answer: The buyer explicitly cited competitor price and matched specs as the deciding factor
When buyers cite price on comparable offerings as the tipping point, pricing is the primary driver — differentiating true price losses from value or execution losses.
A CPP analyst observes that a competitor reduced price by 10% with no change in product. Under an oligopoly, the BEST initial response is typically to:
Answer: Analyze whether the move is a signal, mistake, or competitive assault before responding
Knee-jerk price matching can trigger destructive price wars; first diagnosing the intent and context of the competitor's move leads to better-calibrated responses.
In price benchmarking, 'like-for-like' comparisons require:
Answer: Controlling for product configuration, terms, and quantity to ensure valid comparisons
Valid price comparisons must normalize for differences in specifications, volume tiers, payment terms, and service inclusions to avoid misleading conclusions.
Which tool provides a structured way to track competitor price moves, promotions, and terms over time for market intelligence?
Answer: Competitive price tracking matrix / intelligence database
A competitive price tracking matrix logs competitor prices, terms, and promotions systematically over time, enabling trend analysis and strategic response planning.