value pricing

First step in running a profitable business: don’t be scared of making money

In my line of work, I encounter a lot of small business owners who set their prices by copying the “going price” in “the market” or by sticking their fingers in the wind.  This is unfortunate, but fixable.  What really … Read More

If you think you’re worth it, but can’t say it…

A lot of businesses think they have a great product or service.  Something above and beyond what the competition offers.  But when it comes time to put a price on all this awesomeness, they are still cheaper than the competition. … Read More

Value Pricing: When do I have to cut my price?

I was talking with a customer the other day about a new service his company has developed.  It’s innovative and profitable, and they have found ways to reduce a lot of their costs to make it even more profitable.  The … Read More

Price Optimization 101

I get a lot of questions about price optimization, so I just wanted to make it really simple. Write down your costs.  Of course, you won’t know your real costs, so just use estimates, preferably from 2-5 years ago.  These … Read More

Value-based Pricing: When can I stop asking questions?

How do you know when to stop asking questions about value? Couldn’t this go forever, asking “Why? Why? Why?” until we end up in a philosophical discussion? You want to ask questions until you no longer get meaningfully different answers. … Read More

Value, pricing, and the TSA

I try to avoid political commentary, but sometimes I just can’t avoid it. The airline industry has always been a tough place to make money, but since 9/11, terrorism fears, long delays in security, and surging oil prices have really … Read More

Better, Not Cheaper: Red Velvet Events

In a previous post, called Be Better, Not Cheaper , I talked about how important it is to differentiate elements of your offering other than just your price. Here’s a great example of executing that strategy from Austin and San … Read More

10 Maxims for Improving Profit through Better Pricing

Your price ceiling is limited by the Perceived Differential Value of your offering.  Customers determine this, but you can help them along the way. Your price floor is limited by your costs.  If your floor and ceiling are the same … Read More

Don’t limit yourself on price

If you’re reading this blog, you probably know the dramatic profit impact of small price improvements.  (For a company running at 10% net margin, a 1% price improvement increases profit by 10%.)  Yet even when companies want to improve pricing … Read More

In Apple Comparison, Dell Leans on Price

Dell has launched a new back-to-school campaign highlighting the lower prices of of Dell laptops compared to Apple.  At a high level, this is a great idea.  Apple has regained a (the?) leadership position in the educational market, which is … Read More