The CTSI Guide to Pricing Practices (the Guide) will require changes to your systems of managing pricing. The requirements in the Guide mean that there are no longer prescribed systems to comply with. Instead each case must be taken on its merits. While this may seem an imposition, the old system led to significant abuses.
Not to worry as you now have a certain freedom of action. If you can show that your pricing is fair, doesn’t mislead and you took due diligence in coming to a decision, you are in the clear.
The Guide contains examples but it is apparent that the CTSI did not want to describe situations that would be used as a replacement for the ‘28-day rule.’ They make clear, though, what is required. Let’s look at the planning stages of an email marketing campaign. The price will be a fundamental part of course, and the Guide makes it clear that your processes in coming to the decision will be considered in any case.
You must record the manner in which the price was calculated. You need to show that you acted professionally, with due diligence and that the price chosen was fair and not misleading. If you are subject of a complaint you need evidence of:
1/ details of previous pricing levels, not only in previous email marketing campaigns but in all platforms that the product was advertised. This includes trade shows, radio/TV ads, posters, magazine adverts, on your website and more. Ensure you cover social media methods of advertising,
2/ what terms and conditions were applicable to the other methods of offering the product for sale,
3/ stock levels, especially in cases of ‘while stock lasts’ offers,
4/ where comparisons with competitors’ prices have been made, sufficient records of their promotions. You must prove that you are comparing like for like,
5/ by what means prices have been communicated to customers.
In other words, you need to show that you have taken into consideration all the necessary circumstances when coming to a decision as to pricing.
In many ways the new Guide gives us freedom to try new methods. All we need to do now is justify them.