Eric Siu walks through a five-step framework for value-based pricing. Start by asking clients what success looks like, then quantify it in dollars. Anchor your price to a percentage of their projected revenue, build in the probability of hitting that result, and offer tiered options. Charge for impact, not hours.
Do you want to know the difference between landing a $120,000 deal and a $1.2 million deal? Number 1, reframe the conversation. Most marketers start talking tactics. The top 1% start talking about results. Open your call by asking one question: What does success look like for you? 2, you got to quantify success. Once they describe success, pin it down. Ask, and what's the value of hitting that metric? And number 3, you want to anchor with knowledge. Once they confirm the number, anchor your price logically. If I can guarantee that you make $100 million, would it be fair to pay us 10% of that? Nobody says no to logic. Align with value, which is nice because I hate awkward conversations like, what's your budget? How much can you afford? And step 4, you want to multiply your odds of success. Here's where it gets real. Estimate your odds of making that result happen. So if the success rate is 50% and they are actually willing to pay you up to $1 million, then multiply that $1 million by 50% and you get $500,000. That will then be your top pricing tier, $500,000. You have a $250,000 tier and you will have a $125,000 tier. Most of the time they end up picking the middle one. Sometimes they pick the higher one. But by doing this, you are being a little more methodical in terms of how you go about it with your value-based pricing. And step 5, you want to deliver bigger value for fewer clients. Stop stacking low-budget clients. Focus on high-value partnerships where you're seen as a partner, not a vendor. When you charge for impact instead of effort, everyone wins, including your team. Follow for more ways to scale your pricing psychology and add more sales.
