“There are two fools for every market: one asks for too little, the other for too much.” (Russian proverb)
Every business has to price what it sells. It is inescapable, yet deeply misunderstood. Most organisations have the right intuition: know your costs, track the prices of competitors, understand what customers want and value, and agree on the broader corporate goals. However, the problem often lies in juggling this information and combining it with sufficient confidence. In this session, I recommend that organisations follow three steps: scope, set, and tweak. I draw several lessons, but three stand out. First, pricing anything is a balancing act between looking inside and outside of the organisation for direction. Second, the dominant ingredient is always the same: appreciating how one’s offering is unique and meaningful in the eyes of customers. Third, management must question how the processes of creating and capturing value in a market feed into each other. Decoupling the two can cause organisations to act incongruently, which over time puts sustained financial and brand health in jeopardy.