How do I know what my customer is willing to pay?

11. Juli 2013

Value Based Pricing means charging what your customers are willing to pay. Line-item-pricing is one first and important step to what your customer normally doesn’t want to disclose.

If you let your customers negotiate the overall job quote – without making any changes to the products on the line items – you effectively let them destroy the value of the individual parts that make up the overall quote. Have a look at this shopping list example. Your buyer needs to realize that each of the products and features they’re buying has some amount of value.

Still, in the b2b-world we often do not know how much a specific customer is willing to pay in a specific situation. What if we thought of value based pricing as an attitude: We know we won’t always be right, but we are doing our best to estimate what our customers are willing to pay and charging as close to that as possible. This is what value based pricing really is, estimating willingness to pay.

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