The previous Tip discussed marketing theories, along with other theories that can help drive information campaigns toward a service. One of the fundamental elements to marketing theory and its application is that of price. Pricing decisions often determine the fate, or success of a good or service, especially newer ones. Selling for too cheap could result in unrealized profits or even losses with the sale of each product or service. Additionally, too low of a price might signal to potential buyers that what is being offered is of low value and/or low quality, and it is difficult to raise prices substantially when something already has been offered at a much lower price. Naturally, too high of a price might preclude many potential customers from the purchase of your good/service.
Makers/sellers of goods and services often conduct willingness-to-pay (WTP) evaluations in helping to determine a potential price point. WTP is especially useful to know for a new service. Hohmeier et al conducted a WTP analysis with regard to patients’ use of point-of-care (POC) testing services in community pharmacy.1 Patients indicated favor toward the concept, indicating it being convenient and close to home and content with the idea that test results are sent directly to their physician. The available tests most preferred for performance at the pharmacy were in descending order: cholesterol, A1C, blood sugar, influenza, liver enzymes, strep throat, and Vitamin D. Of those who preferred the community pharmacy setting to receive POCT services, 75% indicated they would be willing to pay $50 or more compared to 79% of the entire sample who preferred to pay $50 or less.
The results of this study suggested a growing niche market for POCT in community pharmacy. Of course, examining WTP is important but does not necessarily translate fully to real actions. The researchers also suggested that further study is needed to determine whether patients would be willing to pay for a treatment immediately upon diagnosis of a condition. Still, pharmacy managers would do well to evaluate patient WTP for a potential service in addition to homework on the potential for coverage by health plans for a service that could save them money in the long, even immediate term.
Additional information about Marketing Applications can be found in Pharmacy Management: Essentials for All Practice Settings, 5e. If you or your institution subscribes to AccessPharmacy, use or create your MyAccess Profile to sign-in to Pharmacy Management: Essentials for All Practice Settings, 5e. If your institution does not provide access, ask your medical librarian about subscribing.
1Hohmeier K, Loomis B, Gatwood J. Consumer perceptions of and willingness-to-pay for point-of-care testing services in community pharmacy. Res Social Adm Pharm. 2018;14(4):360-366.