Willingness to Pay (WTP) is one of the most popular ideas in pricing. Many software packages or consultants will tell you that they can calculate your customer’s willingness to pay and use that to set prices. What happens when willingness to pay collides with ability to pay? Or when there is compelling community need that transcends either.

“Everyone has a plan until they are punched in the face.” Mike Tyson famously said. Many of us feel like we have been punched in the face and are scrambling to respond and not react, adjusting our pricing, applying discounts and changing terms of trade on the fly. Willingness to pay has been replaced by ability to pay or even interest in paying. Let’s share how each of us are responding.

In a time of great uncertainty transfer risk from your customer to yourself. One way to do this is with usage based pricing. Layering in usage based pricing is a good pricing strategy to increase willingness to pay (WTP).

How can a maturity model help you with your pricing strategy? It all comes back to what drives value. Different stages of a maturity model drive value in different ways and therefore, influence how they should be priced

Pricing has important transition points across the technology adoption cycle. How you think about value and use it to shape your pricing strategy changes as your buyer’s motivation changes. It is critical that leadership, investors, product and services managers and marketing understand these transitions and price products or services appropriately for them

When designing pricing, one must consider how value is created and differentiated. Does a service differentiate on experience or outcome? Here is a simple process for integrating experience and outcomes into value-based pricing.

Willingness to pay (WTP) is one of the most frequently abused concepts in pricing. Many people try to use it as a proxy for value. It is not. Other companies claim they can estimate willingness to pay through surveys. This is too simplistic. Why?

Willingness to pay is determined by framing and by the value delivered to the customer relative to the alternative. To measure willingness to pay without taking these into account is wasting an opportunity to really understand your customers and position the value you are providing.

Willingness to pay (WTP) is one of the most abused terms in pricing work. Lazy consultants use it as a proxy for value. It is not. Market researchers think of it as something to be measured. Pricing strategists look for ways to shape WTP through marketing segmentation, value communication and a pricing model that connects price to value.

Willingness to Pay (WTP) is one of the most popular, and slipperiest concepts, in the pricing world. Three key things to remember: (i) WTP can be shaped, it is not a given, (ii) WTP is a distribution and not a point, (iii) the shape of the WTP distribution impacts your pricing strategy.

In the Sixth Edition of The Strategy and Tactics of Pricing, Tom Nagle and Georg Muller introduce the Value Cascade. This is a powerful framework for identifying value and pricing leaks. Use it to ask yourself hard questions about how you create, communicate and capture value.

Pricing strategy and design work inevitably includes a lot of numbers. Too often, we focus on the numbers describing the numbers, averages, medians, standards of deviation. In most cases, the shape of the distributions is as important as the absolute values.

The freemium revenue model is the go-to-market strategy for many web-based software solutions. Unfortunately, it can turn into a costly trap for the service provider. We saw this happen in June of this year with the Photobucket freemium to fee-based service migration debacle. Let's delve into what went wrong with Photobucket's fee introduction and contrast this with the lessons to be learned from Meetup's successful migration to a paid subscription model.

Pricing is ubiquitous in our everyday lives yet pricing seems to be at the periphery of most business decisions.