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BusinessMasters12 m+140 XP
Pricing strategy: capturing the value you actually create
Value-based pricing, anchoring & packaging architecture
Cost-plus pricing (cost × markup = price) anchors your price to your costs rather than to the value you create. If you help a client generate $500,000 in revenue, charging $5,000 because your cost was $2,500 means you're capturing 1% of the value you created. Value-based pricing asks: what is the outcome worth to the buyer? Then price as a fraction of that outcome. The discomfort with this model is that it requires you to have deep clarity on the value you deliver.
Key Points
- ▸Cost-plus: price anchored to your costs (weak)
- ▸Value-based: price anchored to client outcome (strong)
- ▸Research your client's ROI before setting prices
- ▸10-30% of delivered value is a reasonable capture rate