+12-13% average order value growth. Stable conversion rate despite significant price increases. And all of this in a market that had just collapsed by over 50%. This case proves that data-driven pricing works even when everything else is going against you.
Extradom is quite a unique type of e-commerce that offers blueprint and other custom architectural designs with the option to build them on a client’s property. Their goal is to make the experience of building property as convenient as possible. Their offer is aimed at future house owners and expanding companies that want to build new facilities.
Technically, it’s fair to call Extradom e-commerce. However, their unique offer makes their job quite challenging. Returning customer rate is close to zero, the sales cycle can take more than a year, and there certainly is quite a lot of direct and indirect competition that wants their piece of the cake. Understanding customer pain points was crucial for developing an effective pricing strategy that meets their specific needs and expectations. And the worst part? The cake got much smaller last year.
In a shrinking market with increasing competition, protecting or even growing market share becomes critical. Pricing consultants can bring fresh insights and uncover opportunities that internal teams might miss, helping businesses stay competitive and adapt to changing market conditions.
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The Valueships team made a complex process feel smooth and easy. At first, I thought that with products like ours (and such a market), it would be challenging to determine prices using statistical models, but in the end, it turned out that it can be done and works. We got more than expected in terms of financial results, and we feel much better prepared for the future thanks to all the pricing know-how and tools we received.
The year 2022 brought a wide range of economic problems for almost every industry, but the housing market in Poland has taken a particularly big hit. Material and property prices increased significantly, and banks became more hesitant to give mortgages, resulting in an over 50% drop in the total number of mortgages compared to 2021.
To put it in numbers: comparing BIK reports, the market data from September 2021 showed PLN 8.2 billion in volume, while the data from September 2022 was PLN 2.2 billion in volume. The market didn't just slow down - it cratered.
The situation for businesses like Extradom was becoming more and more dreadful. It wasn't only a matter of growth at that point - it was a matter of survival. And in a moment like that, pricing becomes one of the few levers you can actually control.
Extradom’s key goals were to increase revenue and Average Order Value (AOV). More specifically, Extradom wanted a more scalable and profitable pricing strategy and a team that would help them implement it in an orderly and timely manner. We also had to focus on boosting the EBITDA, which was a goal of the Private Equity fund behind the company.
Up to that point, the client was using a simple cost-plus pricing model with a lot of uncontrolled and aggressive discounting. They realized it was far from ideal and looked for a pricing expert to help them find a more suitable and efficient approach. The transformation from cost-plus to value-based pricing was the core of what needed to happen - moving from a model driven by internal costs to one driven by what customers actually value.
Value-based pricing is underpinned by the idea that a product is only worth what customers are willing to pay, and it focuses solely on customers and their perceived value of the product. This approach requires significant market research to understand customer perceptions and needs, allowing companies to capture a greater share of the value they create. However, value-based pricing is not as straightforward as cost-plus pricing and requires a deep understanding of customer segments, as well as ongoing attention and adaptation to market changes and customer feedback, since values are constantly changing based on external factors.
What’s crucial - they weren’t just looking for a few smart-asses with a PowerPoint presentation. They needed a pricing consultancy that would go to the trenches with them and assist on every step of the implementation. Integrating commercial strategy was essential in developing and executing the new pricing approach, ensuring alignment with broader business goals. Price setting is incredibly challenging in this market due to subjective indicators influencing decisions, such as aesthetics and emotions. Overall, it’s a big challenge to understand what should and what should not drive the price.
The process consisted of three phases - and the depth of analysis we applied here was unlike anything a simple cost-plus model could ever deliver.
We gathered all the relevant data regarding products, their popularity, prices, variants, as well as conversion rate and other transactional data. Our goal was to understand what exactly are the value drivers and how significant they are from the clients’ perspective. We also conducted price sensitivity analysis to assess how price changes affect demand and to find the right balance between higher margins and stable sales.
For example, we wanted to know how much people are willing to pay for an additional garage, bathroom, or basement. So, we ended up with a list of about 25 value drivers that we included in the analysis. This is competitive pricing analysis taken to its most granular level - not just comparing headline prices, but understanding the value of every single attribute. It is crucial to consider value perception, ensuring that prices are aligned with what customers see as valuable across different segments and channels.
Then, we went on to do the same with the competition. Once we had a comprehensive set of data, we could compare portfolios, prices, discounting strategies, and many more crucial angles. This included analyzing different price points through benchmarking and testing to identify the most effective pricing levels. The diagnostics gave us the full picture of where Extradom stood relative to the market - and where the pricing optimization opportunities were hiding. This phase also helped us uncover opportunities for pricing improvements that may not be obvious from headline prices alone.
This is where data-driven pricing really came to life. First, we took all the available internal data about products and sales. Then, we created a data science model to detect and analyze similarities between our client’s offer and competition. This model supported more informed pricing decisions, ensuring profitability and alignment with market value. We ended up with over 200 million SKU comparisons that helped us prepare a list of precise instructions on how to deal with each and every product.
As a result, over ⅔ of products were set to have their prices increased, and ⅓ decreased. This is the difference between a value-based pricing strategy and a blanket price hike. We didn’t just raise everything - we aligned each product’s price with its actual market value. Some products were underpriced and needed to go up. Others were overpriced relative to competition and needed to come down. The net effect was positive because the underpricing was far more significant than the overpricing.
The analysis turned out to be a complete game-changer in terms of how the client approached the entire portfolio. The model not only helped the client set the prices but provided the company’s team with a simple, scalable process for pricing in the future. We also implemented advanced pricing solutions, such as value-based pricing, tiered rates, and automated pricing rules, to support tailored and sophisticated pricing models. Additionally, consultants developed a customized pricing playbook for Extradom, including segmentation strategies, discounting logic, and value-based pricing recommendations. That’s what separates a one-off consulting engagement from a real transformation - you leave the client with tools they can use for years.
The implementation was the cherry on top. We prepared a detailed schedule for all the significant changes to make sure the client's team had everything they needed to move forward. Of course, we were still there to answer any questions or assist the team throughout the process.
Before we move to the results, we simply have to shout out the dedicated project team at Extradom and the financial director, Joanna Wróblewska, who worked with us closely during the entire process up until the final technological handover.
We'll move on to the numbers soon, but before we do that, we have to talk about an even more important aspect in the grand scheme of things: capability building. After the project, we left Extradom's team with both the know-how and analytical tools to efficiently expand their business in years to come. They weren't just handed a new price list — they were given a pricing methodology they can own.
But how does it translate to financial results?
This is what happens when you move from cost-plus to value-based pricing in a crisis. Most companies freeze or cut prices when the market drops. Extradom did the opposite — and grew. Because the pricing optimization wasn't about raising prices arbitrarily. It was about aligning every product's price with the value the market assigns to it.
As a pricing consultancy operating in the European market, we've seen this pattern before: the companies that invest in data-driven pricing during downturns come out of them stronger. Extradom is a textbook example.
Customer perception is at the heart of every successful pricing strategy. Leading pricing strategy consultants know that understanding how customers view the value of a product or service is essential for setting prices that drive both revenue growth and customer loyalty. By tapping into customer feedback, conducting in-depth customer research, and leveraging focus groups, companies can gain a deep understanding of customer needs, preferences, and willingness to pay.
Unlike cost plus pricing, which simply adds a margin to costs, a value based pricing approach puts customer perception and willingness to pay front and center. Pricing consulting firms and pricing consultants use advanced analytics and data driven insights to develop value based pricing models that reflect the true perceived value of a product or service in the eyes of each customer segment. This enables businesses to optimize pricing, uncover new pricing opportunities, and set prices that maximize both profitability and customer satisfaction.
Dynamic pricing is another powerful tool in the revenue management pricing toolkit. By analyzing customer data, monitoring market trends, and tracking customer behavior in real time, companies can adjust prices dynamically to respond to changes in demand, competition, and perceived value. Pricing experts from top pricing consulting firms help businesses implement dynamic pricing strategies that not only increase revenue but also enhance customer loyalty by ensuring customers feel they are getting the best price for the value received.
In today’s diverse industries, from retail pricing to corporate finance, the principles of value based pricing remain consistent: focus on customer perception, understand what drives value for each customer segment, and use data driven insights to inform every pricing decision. Effective pricing strategies require ongoing analysis of customer feedback, regular market research, and a willingness to adapt to evolving customer needs and market conditions.
Working with pricing consultants and leveraging the expertise of pricing consulting services allows companies to overcome specific pricing challenges, optimize pricing structures, and drive profitability. Whether the goal is to increase revenue, expand into new markets, or improve operating profit, a strategic pricing approach rooted in customer perception and value is key.
Ultimately, the link between customer perception and pricing is undeniable. Companies that prioritize customer needs, invest in understanding customer willingness to pay, and use advanced analytics to inform their pricing strategies are best positioned to achieve sustainable revenue growth and profitability. By partnering with experienced pricing strategy consultants and adopting a value based pricing strategy, businesses can navigate complex markets, set prices that reflect true value, and build lasting customer relationships.
Can you raise prices without losing customers during a market downturn?
Extradom is the proof. In a year when the Polish housing market dropped by over 50%, we helped them increase average order value by 12-13% with a stable conversion rate. The key was precision: we didn’t raise prices across the board. We used a data science model with 200 million SKU comparisons to understand exactly which products were underpriced and which were overpriced. Two-thirds went up, one-third went down. The net effect was positive growth - because the adjustments were based on value, not guesswork. A pricing consultant in Europe optimizes a company’s revenue and profitability by developing strategic pricing models, analyzing market trends, and evaluating customer willingness to pay.
What’s the difference between cost-plus and value-based pricing?
Cost-plus pricing sets the price by adding a margin to your costs. It’s simple, but it has nothing to do with what customers actually value. Value-based pricing starts from the other end - what is this product worth to the buyer? Extradom was using cost-plus with aggressive discounting, which meant prices had no connection to market reality. The shift to value-based pricing, driven by competitive pricing analysis and data science, resulted in a 12-13% AOV increase. In markets with subjective value drivers like aesthetics and emotions, cost-plus is especially dangerous because it completely ignores what the customer is willing to pay. Value-based pricing can also support setting a higher price point for products with strong brand reputation or niche positioning, as seen with premium brands.
How does data-driven pricing work for a large product portfolio?
When you have thousands of SKUs, you can’t price each one manually. We built a data science model that compared Extradom’s entire portfolio against competition - over 200 million SKU comparisons in total. The model detected similarities between products, analyzed value drivers (things like garage, bathroom, basement, square footage), and generated precise pricing instructions for each product. The result was a scalable process that the client can reuse as their portfolio evolves - not just a one-time price list.
How do you price products where emotions and aesthetics drive decisions?
This is one of the hardest pricing challenges. With architectural designs, the purchase decision is deeply personal - people are choosing their future home. You can’t just benchmark on features alone. Our approach was to identify approximately 25 value drivers and measure their impact on willingness to pay. Some were functional (number of rooms, garage size), others were harder to quantify but still measurable through competitive analysis and transaction data. The combination of functional and emotional value drivers gave us a pricing model that respected how people actually make these decisions.
Why should companies invest in pricing optimization during a crisis?
Because a crisis amplifies every pricing mistake. If you’re overpriced on some products and underpriced on others, a shrinking market makes both problems worse. Pricing optimization during a downturn isn’t about raising prices - it’s about getting them right. Extradom’s competitors were likely cutting prices or freezing them. Extradom realigned prices based on data and grew 12-13% while the market contracted 50%+. The companies that invest in data-driven pricing during downturns come out of them stronger.
What is competitive pricing analysis and how does it differ from just comparing prices?
Comparing prices is looking at what competitors charge for a similar product. Competitive pricing analysis goes deeper - it compares entire portfolios, identifies value drivers that justify price differences, analyzes discounting strategies, and maps where you’re overpriced vs. underpriced relative to the value you deliver. For Extradom, this meant comparing not just headline prices but the value of every individual product attribute across the competitive landscape. That granularity is what allowed us to generate precise, product-level pricing instructions. Dynamic pricing adjusts prices in real-time based on customer profiles, demand, and competition to increase revenue and market responsiveness.
Do you only work with SaaS companies?
No. While SaaS pricing optimization is our strongest area - with case studies across companies like Brand24, Navifleet, Thulium, and many more - we work with any business where pricing is a growth lever. Extradom is proof that our methodology applies beyond SaaS. The core principles are the same: understand the value you deliver, benchmark against competition, build scenarios, and implement with precision. Whether it’s a subscription product or an e-commerce platform selling architectural blueprints, data-driven pricing works. When implementing pricing strategies, it’s also crucial to align pricing tactics with sales teams to motivate and improve their performance, especially in B2B contexts.
+12-13% AOV growth
Stable conversion rate despite a significant pricing increase
Maintaining growth despite very unfavorable market conditions
Know-how and analytical tools for Extradom team
Certified expert in price, revenue and margin management in B2B companies and e-commerce. Member of the prestigious Professional Pricing Society. At Valueships, he is responsible for the implementation of consulting projects and taking care of the profitability of clients. Prior to joining Valueships, he worked at McKinsey & Company in the area of pricing and strategy.
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Certified expert in price, revenue and margin management in B2B companies and e-commerce. Member of the prestigious Professional Pricing Society. At Valueships, he is responsible for the implementation of consulting projects and taking care of the profitability of clients. Prior to joining Valueships, he worked at McKinsey & Company in the area of pricing and strategy.
