Summary

How customers respond to your pricing is determined by more than the value delivered by your product and the price you charge. It is also influenced by how they evaluate your product and your price. If you leave those judgments to chance, you are likely to be paid much less or sell much less than you could. Most customers lack the time or the incentive to fully inform themselves about their alternatives and to evaluate the information they do have. If you want them to recognize your value, you have to make the process easier for them by supplying them with information about your offer and what you think it should mean to them.

You also need to actively manage how you communicate the price to minimize adverse feelings about paying it. By controlling the visibility of price differences, the formulation of references, and the perceptions of fairness, you can reduce negative reactions to your pricing without reducing your overall margins.

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