Monetizing Innovation: How Smart Companies Design the Product Around the Price

Too often, however, greed gets confused with positioning thinking. Charging high prices is not the way to get rich. Being the first to (1) establish the high-price position (2) with a valid product story (3) in a category where consumers are receptive to a high-priced brand is the secret of success. Otherwise, your high price just drives prospectiv

This approach works even better when you follow up your quantitative questions with two qualitative ones: Why? And what happens next? The “why?” question challenges the respondents to explain their estimates, particularly what happens to the demand if you cut prices and what happens if you raise them. The “what happens next?” question is another wa

“Good pricing has three prerequisites: create value, quantify value, and communicate value,” I said in summary. “That is when you get the price you deserve, the price you need for a profitable business. And, last but not least, avoid price war s.”

If you can make it difficult—in terms of either money or time—for a customer to switch to a competing product, you can charge your customers more and make more money—simple in theory, but difficult in practice.