Pricing Strategies
Methods for setting prices that maximize value capture while serving customer needs.
Also known as: Pricing models, Price strategy, Monetization strategies
Category: Concepts
Tags: businesses, pricing, strategies, economics, marketing
Explanation
Pricing strategy determines not just revenue but positioning, customer perception, and business sustainability. Common strategies include: cost-plus (markup on costs), value-based (price based on perceived value), competitive (matching market prices), penetration (low price to gain market share), skimming (high initial price, lowering over time), and premium (consistently high price signaling quality). Psychological factors matter too: $97 feels cheaper than $100, bundles feel like deals, and anchoring with higher options makes mid-tier attractive. For creators and knowledge workers, pricing often determines who you attract—low prices attract price-sensitive customers while premium prices attract serious buyers. Testing and iterating on pricing is often the highest-leverage business optimization.
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