50% of your customers won't repurchase because of you

How-To develop a monetization strategy through pricing, loyalty, and promotion. [w/Profit Calculator]

“I’m Struggling With Pricing! How Do I Stop Undervaluing My Work?”

Is a question I often hear from new start-ups as we’ll as established mid-sized firms. They understand that they shouldn’t add discounts to everything however, they feel the pressures of the competitive marketplace, they know customers have more choices now than ever, and business owners fear the biggest business monster of all… overstock and inventory or services that don’t sell.

If you can relate to this and feel your heartbeat increase when someone asks, “How much do you charge?”, you’re not alone.

Pricing isn’t just random numbers. It’s about confidence, positioning, and value perception. Undervaluing your work doesn’t just hurt your income, it kills growth and long-term trust.

The problem that I often see is people start with rates that their competition starts at and they decide to heavily discount to attract customers.

YIKES, THIS IS A MAJOR NO-NO!

60% of consumers say constant discounts make a brand feel less premium.
— Source: Retail Dive / Forrester Consumer Survey, 2022

Why it matters:
Heavy discounting trains customers to wait for deals rather than pay full price, reducing your pricing power and killing your profit elasticity over time. Discount-driven customers are 50% less likely to repurchase compared to value-driven buyers.
— McKinsey & Company, 2023 B2C Loyalty Study

Your products and services are valuable and you need to believe that before anyone else will. You’re in business to make profits and cost margins should be a strong consideration in developing a pricing strategy.

I’ll share how to structure a pricing plan for acquisition, loyalty, and retention. And yes, you should have all three mapped out.

For many years, I developed pricing models and the first thing I start with, isn’t what you would assume. I don’t start with the competition.

Just a 1% drop in price requires a 2.4% increase in sales volume to maintain the same profit.
— Harvard Business Review, "Pricing and Profitability," 2019

Instead, I start with brand positioning, how are they’re perceived by their customers and what are the brand’s future goals? I wouldn’t recommend a cost-leader strategy to a company that makes exquisite jewelry, from the finest materials, and hand-crafts each piece. If I suggested they compete with big-box generic jewelry makers, their revenues may increase in the short run, but profitability would suffer because their operational expenses would be too high to sustain this approach.

As an alternative, this is the approach I would take:

• First, do a brief review of what new customers are saying about the products/services. If possible, conduct a brief survey to determine the brand perception.

• I would look at their profit and loss statements to fully comprehend the expense structure.

• Only later would I do a comprehensive competitive analysis, mapping my client’s brand to aspirational companies, local competitors, and online alternatives/substitutes to create a full visualization.

• I would then run strategic pricing tests through digital media to determine the winning pricing tiers.

Pricing With Purpose

Paid subscribers: as a thank you for reading - comment below and I’ll send you my pricing calculator so you can determine your margin %, suggested pricing, and profit impact.

When it comes to quick considerations that you can do, here are things I would challenge everyone to think about:

1. Ditch Hourly: Embrace Outcomes

• Customers don’t understand how to price time, is 1 hour affordable or expensive? It depends. They buy results and experiences.

• Reframe your offers: “I’ll increase your email conversions by 25% in 30 days and teach you how to continue the trajectory over a 90-day period.”

2. Use Tiered Packages: Good, Better, Best

• Offer 3 clear pricing tiers: Basic, Growth, Premium

• Anchoring makes mid-level offers feel like “the smart choice.”

  • For a restaurant client I had, I used a strategy that involves “premium decoys” which are placed in a pricing structure but are rarely ever purchased. Why? Because they anchor the other price-points and help people cognitively understand if the low and high tiers are reasonable compared to their value. This approach improved their mid-level offering sales by 50%.

Pricing Matrix: Product Quality x Product Price

3. Charge for Strategy, Not Just Execution

• Add a “Strategy First” offer: AME (e.g., Ask Me Anything), audits, roadmaps, workshops, and strategic opportunities to provide added-value to customers that only you can provide. Why? It builds trust and filters serious clients.

4. Confidence = Clarity

• Write your pricing down. Practice saying it aloud. Stop qualifying it with “if that works for you...” or worse, “how much do you want to pay”. This will be controversial, but, also limit how often you say “what’s your budget?”

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Attract Smarter: DIY Pricing & Promotions for Customer Acquisition