Ingersoll Rand is a $17 billion global diversified industrial company with a 100-year-old tradition of technological innovation. The company provides products, services and solutions that enhance the quality and comfort in homes and buildings, transport and protect food and perishables, secure homes and commercial properties, and enhance industrial productivity and efficiency.
Ingersoll Rand's product marketing team felt they lacked a reliable strategy for determining price fluctuations for two of their product lines. They sought a partner who could help them achieve two general objectives:
- To enhance understanding of the value of good marketing practices and pricing techniques.
- To provide a focused set of tools to drive marketing excellence across the country.
After an exhaustive search, Ingersoll Rand selected KEP as their partner of choice. Kelley Executive Partners created an intensive five-day, instructor-led program to work with Ingersoll Rand teams and develop new techniques for establishing pricing in their product lines. The program was called Driving Dramatic Growth through Marketing Excellence, or DDG.
The DDG program would be measured by its ability to bring these results:
- To work with IR's marketing teams to develop new tools for thinking strategically - rather than reactively - about product pricing.
- To establish more effective, validated methods for setting product pricing.
- To apply specific marketing methods and tools to current marketing initiatives.
During a post-program debriefing session, all participants agreed that the Driving Dynamic Growth program was a complete success, empowering the marketing team with an effective pricing strategy. Moreover, the two pricing models taught in the program resulted in an immediate price impact of $209,473 to the business, equating to a total of 10% price impact.
- Using the DDG elasticity concepts and tools, participating divisions of Ingersoll Rand realized approximately $1.9 million in additional operating income in the following fiscal year.
- The DDG program was determined to have been directly responsible for at least 30 percent of the margin differential established for both target product families.
- Annualized at this rate, $1,887,616 additional operating income due to price increases will be realized by application of DDG price elasticity concepts and tools.