Jonas Reuter
Managing Director, Partner
Lighting manufacturers stand out from the market with the right pricing strategy
Strengthen your market position and profitability without compromising existing distribution channels. With our in-depth industry experience, we optimize your product communication and implement advanced pricing strategies for higher returns. This enables you to effectively and directly counter margin pressure.
Challenges for luminaire manufacturers
The lighting industry is facing a number of obstacles that affect both its market position and companies' growth opportunities.
Lack of differentiation leads to margin erosion.
Interchangeable products intensify competition.
Product copies undermine the brand identity.
Price wars are eroding profit margins.
Multi-level distribution hinders growth.
High dependence on wholesalers limits direct customer interaction.
Lighting planners and architects make the purchasing decisions.
Intensive field sales via wholesalers dominate the sales strategies.
Pricing is the easiest way to achieve profitable sales growth.
More income through modern pricing strategies
Optimal pricing is a key factor for business success and is often seen as the easiest way to achieve profitable sales growth. We work with you to evaluate innovative pricing strategies that are specifically designed to increase margins while increasing the perceived added value for customers.
The strategies of MORGEN strategies can be seamlessly integrated into your existing business model and aim to optimize both short-term profits and long-term market opportunities. We use proven methods based on thorough market analysis and customer understanding to ensure that our pricing strategies are not only competitive but also sustainable.
Value-based pricing
In the lighting industry, value-based pricing enables margins to be improved and customer loyalty to be strengthened. This strategy is based on the perceived value of the products by customers rather than just the manufacturing costs. By emphasizing unique product features such as design, functionality and technological innovations, a company can clearly stand out from the competition and sustainably increase its business success.
The path to the price determines the value!
Although price is often the last element that customers see, how you get there has a decisive influence on their willingness to pay. This process includes targeted positioning, effective marketing and clear communication that emphasizes the specific value to the target audience. Careful crafting of these elements is critical to increasing perceived value and ultimately successfully pushing higher prices in the market.
Workshop
In-house
Values
Enforcing higher prices through value orientation
This workshop teaches strategies for optimizing pricing in order to increase sales. Participants will learn how to successfully communicate higher prices and convincingly demonstrate the added value to customers. The focus is on effective positioning of products and services on the market.
Target group
Managing directors, sales managers, marketing managers, product managers and sales teams
Managing directors, sales managers, marketing managers, product managers and sales teams
Previous experience
Experience in the development of sales strategies within a corporate context
Experience in the development of sales strategies within a corporate context
Zeitinvest
Two intensive workshop days
Two intensive workshop days
Light as a service business models
The "Light as a Service" (LaaS) model is transforming the lighting industry by offering lighting as an ongoing service rather than a one-off product purchase. This enables companies to use the latest technology without having to make a high initial investment. This model includes installation, maintenance and energy efficiency optimization. Customers benefit from continuous upgrades and manufacturers secure recurring revenues and the opportunity to establish sustainable business relationships.
Usage-based pricing
Usage-based pricing offers the lighting industry a flexible method of adjusting costs to customers' actual consumption. This model takes into account not only the purchase price, but also the intensity and duration of use of the lighting systems. Customers therefore only pay for what they actually use, resulting in a fair price structure and potentially lower overall costs. The advantage for manufacturers is that they can use detailed usage data to better tailor their products and services to customer needs.
AfterSales Services & maintenance contracts
After-sales services and maintenance contracts are essential in the lighting industry to ensure long-term customer relationships and recurring revenues. These contracts include regular maintenance, repairs and predictive maintenance, which predicts and prevents failures. Remote service options also enable fast remote troubleshooting, increase operational reliability and optimize system performance. Customers benefit from reliability and continuous support, while manufacturers consolidate their market position and differentiate themselves through outstanding service.
Target group-specific price models
Target group-specific pricing models enable finely tuned pricing in the lighting industry that addresses the specific needs and expectations of different customer segments. This strategy helps manufacturers to optimally position offers by developing customized price structures for each target group. Such models promote customer satisfaction and loyalty by maximizing perceived value while improving market penetration. Manufacturers can thus respond effectively to market changes and strengthen their competitiveness.
Customer data is the basis for differentiation
Many luminaire manufacturers prefer the traditional distribution channel via wholesalers and do not aim for direct sales. Nevertheless, customer data is essential for creating innovative business models and differentiation in the market. It is crucial to develop methods that make it possible to collect valuable customer information without direct sales. This could be done through the use of configurators and personalized digital tools that not only offer individualized solutions, but also collect valuable data about the preferences and needs of end consumers.
The digital transformation is also leading to a fundamental change in business models in the industry: Hardware and its perfection will no longer be the focus in the future, but rather software, data and data-driven business models. [1]
Jochen Reinschmidt
Head of Digitalization & Legal @ ZVEI Association of the Electrical and Digital Industry
Strategies for differentiation in the lighting market
Design innovation
Unique, hard-to-copy design features
Unique, hard-to-copy design features
Technology integration
of advanced technologies such as IoT, smart lighting systems or energy-efficient solutions
of advanced technologies such as IoT, smart lighting systems or energy-efficient solutions
Adaptability
of modular or customizable products to specific customer requirements
of modular or customizable products to specific customer requirements
Many manufacturers in the lighting industry strive for differentiation through perfection, but despite advanced efforts, many designs and technological features remain comparable. In order to effectively differentiate themselves from the competition, many companies pursue a best-in-class strategy that encompasses not only product development, but also communication and customer service.
However, despite these comprehensive efforts, only a few market players manage to overcome comparability and achieve higher prices on the market through convincing added value.
Platform approach and ecosystem strategy
The platform approach creates a closed ecosystem that integrates certified electricians and bypasses wholesalers to establish direct sales and installation channels. This model promotes exclusivity through a lock-in system where only certified installers are allowed to install the products. Manufacturers offer special training and academy models to ensure that the installation and maintenance of the products meet the highest standards. This strategy strengthens brand loyalty and enables controlled quality assurance as well as deeper customer loyalty.
Individualization & configurators
In collaboration with medienreaktor, we optimize data collection during use and enable direct contact with customers or lighting designers as early as the planning phase. Our interactive configurators are effective tools for lighting planning and sales that facilitate online configuration by end customers, strengthen customer loyalty and accelerate the purchasing process. These tools significantly reduce the burden on lighting planning and raise the quality of advice in sales to a new level. By using our online configurator, you can collect valuable contact data and leads directly from your end customers, which creates a direct line to your customers in multi-level sales.
Data strategy & data-based business models
We specialize in the development of data-based business models that help luminaire manufacturers to make effective use of valuable customer data. Through targeted data strategies, companies gain deeper insights into customer behavior and market trends, enabling the precise adaptation of products and services to the needs of their target groups. Our support ranges from the conception to the implementation of solutions that collect, analyze and strategically use data.
AI-supported innovations in the lighting industry
The integration of artificial intelligence (AI) into products and services enables luminaire manufacturers to stand out from the market with advanced technology. AI-based systems can analyse user behaviour, improve energy efficiency and create personalized lighting experiences. These innovative solutions not only offer significant added value for end users, but also strengthen the competitive position of manufacturers through differentiated, intelligent product offerings.
Workshop
In-house
Digital
Opening up new markets through digital innovation
This workshop teaches core skills for opening up new markets through innovative digital solutions. Participants develop skills to effectively digitize their business model, optimize processes and thus secure long-term competitive advantages.
Target group
Managing directors, digitalization officers, strategy and innovation managers, IT managers
Managing directors, digitalization officers, strategy and innovation managers, IT managers
Previous experience
Basic knowledge of (digital) processes and technologies in the company
Basic knowledge of (digital) processes and technologies in the company
Zeitinvest
Two intensive workshop days
Two intensive workshop days
Over a decade of industry-specific expertise
>14
Years of experience in the lighting industry
30+
Projects for companies in this sector
100%
Passion for lighting & building automation
With over 10 years of experience in the Group, we have in-depth knowledge of the lighting market. Despite the distinct segmentation of this market, we have proven that we can achieve significant success without disrupting existing sales channels or radically changing the overall strategy. Our approach optimizes existing products and works out the value-based benefits to help our customers achieve higher prices. Once we have gained the trust of our clients, we support them in making substantial changes and deep differentiation to diversify their offerings. In this way, we help to ensure that these companies continue to be successful in the future - so that they are still around MORGEN still exist.
MORGEN develops business models for SMEs
Start
TOMORROW
Start
with MORGENM
with MORGENM
Jonas Reuter
Managing Director, Partner
Sources
[1] ZVEI e.V. (2019). Artificial intelligence and digital business models in industry. Retrieved from https://www.zvei.org/themen/digitalisierung/kuenstliche-intelligenz?showPage=6874&cHash=d100fc86b1e3145c089d1fabc56e5a6c on 01.09.2024 incl. image source