Often, founders try to impose a price based on how much value *they* think their product provides. (Much of the "value-based pricing" movement was focused on creators "charging what they're worth.") But that's backward. Ultimately, it's "what is the customer willing to pay?"
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"The price of a thing" is determined by a variety of factors, including: - costs - supply - demand - branding - competition - gatekeepers - govt regulation - perceived value by customer
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Quality, by itself, is rarely enough to increase a product's price by 5x. In the mind of the consumer, "5x better quality" might only be worth "1.5x higher price." Or, it might not be worth any price increase to them!
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If people are used to paying $19/month for a thing, you can't just magically sprinkle "value-based pricing" on it, and expect them to pay $99. Even if your quality is better!
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We should be paying more attention to "brand-based pricing." In most cases, it's your brand that allows you to charge more. A good brand can change the perceived value of a product.pic.twitter.com/RpVBAOGD9p
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@chrislema nails it here: "At the end of the day, a customer defines the value. And your job is to do the hard work to figure out where that value sits."pic.twitter.com/G6BNxQujmyPokaż ten wątek
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100% - talk to any open source project maintainer
So much value provided in this ecosystem. And it is all expected for free.
And shifting a whole community/tribe's expectations is exceptionally difficult. It generally takes a lot of time and a lot of money.Dziękujemy. Twitter skorzysta z tych informacji, aby Twoja oś czasu bardziej Ci odpowiadała. CofnijCofnij
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That’s ignoring competition. If only one company could, for whatever reason, make those pads, they could use value-based pricing. Transistor’s pricing power is probably a lot more psychological than the underlying storage/hosting commodity.
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There's always a variety of things that determine the price. No founder gets to make a pricing decision in a vacuum.
https://twitter.com/mijustin/status/1332028660572770309 …
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