The process of price setting begins at the conception of the product idea. A company must think about prices as early and often as possible in the development process, not just after a product is ready to launch.

The Romans understood this connection so well that they incorporated it into their language. In Latin the word “pretium” means both price and value. Literally speaking, price and value are one and the same. This is a good guideline for businesses to follow when they make their price decisions. It leaves managers with three tasks: Create value: The

People have asked me thousands of times to name the most important aspect of pricing. I answer with one word: “value.” When asked to elaborate, I will use the term “value to customer.” The price a customer is willing to pay, and therefore the price a company can achieve, is always a reflection of the perceived value of the product or service in the

there are two kinds of fools. One charges too much, the other charges too little.”

never run a business in which you have no influence on the prices you charge.

Neuropsychologists have confirmed that the further to the right a digit is, the less influence it has on price perception . According to this hypothesis, customers underestimate prices which lie just under round numbers.

We are constantly making decisions about whether something is worth our money, or trying to convince others to part with their money.

Create value: The quality of materials, performance, and design all drive the perceived value of customers. This is also where innovation comes into play. Communicate value: This is how you influence customers’ perception. It includes how you describe the product, your selling proposition, and last but not least the brand . Value communication also

“That is the worst and yet easiest error. Better be cheated in the price than in the quality of goods.”