| https://personalmba.com/4-pricing-methods/ This reference book is great, and makes the case that there are roughly 4 broad types of pricing strategies: 1. Replacement cost: How much would it cost to replace/build from scratch? 2. Market comparison: How much are similar products/services selling for? 3. Discounted cash flow / net present value: How much money will this make for the customer in the future discounted to today's dollars? 4. Value comparison: How much 'Value' is the product worth to the customer? So, the 'Value Comparison' can usually support a much higher price than the replacement cost, market comparison, or DCF. It's worth learning just how 'Valuable' the product/service is to the customer. The personal mba has a section outlining how customers typically 'Perceive' Value. https://personalmba.com/perceived-value/ The most valuable offers do one or more of the following: 1. Satisfy one or more of the prospect’s Core Human Drives 2. Offer an attractive and easy to visualize End Result with clear economic values. 3. Command the highest Hassle Premium by reducing the time, money, and effort the customer has to spend getting value from your product. 4. Satisfy the prospect’s Status Seeking tendency by providing desirable Social Signals that help them look good in the eyes of other people. Good luck! |