Most companies make pricing an after thought.

Most companies also are never able to use pricing as the superpower it actually is.  

I have had the privilege of overseeing revenue management for over $6 billion in revenue across a diverse range of industries during the past decade. Throughout this experience, I've gained a deep understanding of the critical role that pricing plays in business success. 

I'm passionate about sharing my expertise and insights to help organizations harness the power of pricing strategies to improve profitability and overall performance.

Karan Sood

Set and forget is not a pricing strategy ! 

Price--> Design--> Build 

We know that's what everyone says, but thats an oversimplification of what the entire process should look like. 

The assumption your pricing was correct in the pre-design phase and doesn't need change is dangerous, dangerous, dangerous !! 

I have seen too many physical and software products change drastically between initial design to final delivery.  Product owners will typically assume that pricing still holds. You have to change that philosophy. 

 In the real world we need a lot more iteration in price: 

Step 1: 
Initial Price: This stage you quantify the value and set an initial target price. This is a combination of internal/external research, some value quantification and pricing knowledge. 


Step 2: 
Design: With that price info, the product team designs a product that hits product and profitability targets. This is also where you need to keep track of the product margins. Often product will go design a better product at the expense of higher cost, and margins suffer before launch. 


Step 3:
Reprice: Now that we know the new design constraints that impact the profitability, this stage gives  you the opportunity to reprice the product based on the design. If substantial value has been added, price should go up. Do not fall into the 'lets over deliver on value and keep price same' trap. 

Step 4: 
Build: Now with that new price info and product roadmap the product goes through the build stage. 


Step 5: 
Pre launch reprice : Now significant time may have passed since last price review. The market for the product, the economy etc may have changed. This stage can assist in making last changes before product goes out. Good time to also establish guardrails for price performance, discount strategy, or sales strategy.  


Step 6: 
Launch: Goes without saying the product is out in the real world. Great way to capture feedback. Also a stage where performance is measured against the price guardrails. 


Step 7: 
Reprice 3: Based on sales feedback, you start charting next steps. Selling too slow, you may need discount or reprice. Selling too fast, it may be overdelivering on price vs value. Pricing metric may need change. Fx may have changed. This is the price adjustment stage, should be annual or semi annual. 


You can incorporate these steps into new product introduction framework or annual or semi annual pricing strategy process, either ways it will help establish good pricing principles in the org. 

I know of many products that once designed were never repriced years into its life.. Surely things must have changed all those years... 

Think of Pricing as a lifecycle !!

--------------------------
 We are in #Pricingtribe.

Building the #1 Community for pricing, promotions, deal desk and revenue management.

When price increase + price promotion fall on the same day.

Been there. Same team guys. Same team ! 

hashtag

#PricingTribe

10 tips from pricing professionals for pricing professionals. 

We start all our office hours with new  members providing one pricing tip for the rest of  the pricing community. It's my favourite ritual ! 

Here are this week's 10 best: 


- Don't overmodel: Perfect Now Vs. Imperfect that can't ship. 


- Research your WTP by geo, it's not standard across the board.

 
- Know your breakeven: It will dissuade bad discounting behaviour. 


- Incidental pricing: Find pockets of pricing growth in places customer barely notice. Low frequency purchases are margin gold mines. 


- Pricing's impact is in adoption- build cadence with sales, customers, product so the change actually sticks.


- Create deal thresholds + structured deal reviews so sales knowledge becomes reusable pricing intelligence.


- Before the analysis, map what decision-makers are rewarded for-or your brilliant work won’t get adopted.


- Price improves when you can clearly explain (and validate) what’s truly different about your offer.


- Pick one shared KPI that leadership and sales buy into- misaligned incentives create pricing chaos.


- If you can't share actual margin with sales, develop a system that translates to good better best nargin with green, amber and red score. 


- Find the PricingTribe where we share these insights. 


✉️ Send it to a pricing professional
♻️ Repost it to your network
💾 Save it for the future

#Pricing

The human part of pricing isn't going away.

Key takeaways from our 'pricing using AI' roundtable with Steven Forth, Bill Wilson and Kemal H. Sahin. 


- Generative AI cannot be used to set and forget price points. LLM's are not price automation engines. That's a job for traditional reinforcement learning based revenue management engines.  


- Use LLM's in pricing for summarizing and extracting insights from large volumes of messy qualitative information (calls, notes, competitive intel, product/market feedback). 


- Use AI to produce structured thinking artifacts fast (drafts of value models, segmentation hypotheses, messaging, objection handling, etc.). Value modeling used to be scarce, slow, costly, and rarely updated. Now, done well, AI can produce value models quickly enough to make them dynamic and iterative


- Synthetic data is emerging as a major shift in pricing research. Used as synthetic personas/agents that can be interviewed at scale (e.g., JTBD-style interviews), generating qualitative data cheaply and repeatedly.


- The “human” part of pricing isn’t going away. Strong consensus that pricing is still heavily about change management and stakeholder alignment (product + marketing/positioning + sales+finance+facilities (lol))


- Best practice for making LLM outputs more usable: rubrics. A key practical tactic by define evaluation criteria (rubrics/frameworks) to score outputs and reduce randomness. This will help build consistency, coherence, and trust into AI-assisted workflows.


Next week we have a show and tell where a PricingTribe member will show a bundle recommendation engine built using AI. 

Super exciting conversations #PricingTribe.

Pricing Strategy tactic for global expansion. 


Every company at some point will look at expanding globally. A big mistake most do is use their pricing from home country and convert to local currency, put a new currency sign, add VAT and call it a day. 


While it's not wrong, it's not right either. Sometimes it can go terribly wrong. Learnt it the hard way (damn VAT).


Take Netflix for example. While most of the content is same or atleast the volume is similar but Netflix India is 1/4th the price of its US counter part. 

This is no accident. 

Remember what netflix needs globally ? 

The goal is penetration and secure mass users. 

The cost to get in for them is usually fixed, so anything beyond the coverage of fixed cost is gravy to an extent. And the way to maximize that is with localized pricing. 


Local pricing means a few different things: 

1) Benchmarking base metric: Calculate GDP/capita or disposable income of the local country to a base/home country US/CA/EU/JP etc. 


2) Multiply Base price by country ratio to get local pricing in base currency.  


3) Convert to local FX (Use 6 mon avg). 


4) Convert the local FX pricing to charm/anchor prices where necessary. 


5) Create fencing around price: Customers in US should not be able to access India pricing. Else you have an issue. 


6) Do look at VAT laws. US is always EX VAT, India Including VAT.


There are many other ways to do this including local WTP research. You can do that on top of it to validate your derived pricing. 


What other factors would you consider ?


-------------------------
Follow Karan for all things pricing, discounting and careers in pricing. 

Our PricingTribe Community is in full swing ! On point discussions. This month focus is on building pricing tools with AI. Absolutely loving what people have created. Look in your inbox for your invite or apply.

How a CEO should defend pricing in public.
A lesson from Larry Culp (CEO GE Aerospace)



GE Aerospace has been in the news because parts and service pricing is going up and airlines are complaining. Now remember parts and service terms are key part of airlines and aero deals.



Key component+expertise
+ multi year contract =Pricing Power ! 



Now costs are going up tariffs, investments are increasing, supply turmoil at the same time, there too much demand for their services, and airlines want to keep old aircrafts etc. So a lot is happening that makes things favorable for GE and its pricing.




So customers are doing, what they will always do 'complain about price'. Even when there is no cheaper alternative available or preferred. 



Now GE and other plane parts suppliers have long followed unique pricing practices, including pricing to outcome. So they have to defend their pricing power.



So what does their CEO do when he sees pricing pushback, he pushes back harder. 



How ? 



CEO of GE Aerospace reminds everyone of the value 101 lesson: that the price  you pay today reflects the investment the customer make today for the value they will receive over the next decade. 



This is also a lesson in value based selling that GE’s is communicating: 


- we decrease risk (customer safety)
- we decrease customer opex (Save ongoing cost)
- we decrease customer CAPEX (keep old aircrafts)
- we increase customer revenue (less downtime)



He further added we "will conduct its regular summer review of aftermarket pricing, while relying on productivity gains, redesign and resourcing to limit pass-through".



That very statement conveys we will look at efficiency gain but will pass through in price what is fair. 



I think it's the best way a CEO can respond to pricing pressure. There is a reason they have tapped into their pricing power and are having their most profitable year.



February is "Value based Pricing" month in #PricingTribe.



If you liked this send, save or repost it ! 



PIC: GE aviation. That equipment itself speaks high pricing.

No alternative text description for this image

Pricing gets easier when you’re not solving it alone. Proof: This month inside PricingTribe.


Not theory. Not slides for the sake of slides.


We are stacked !!

- Office Hours: Pricing problems, unpacked


- AI Show & Tell with Michael Binney building comprehensive AI products/workflows


- January Roundtable: Using AI in Pricing: What to Automate and What to Keep Human
With Steven Forth and Bill Wilson.


- Member Show & Tell with Krista Gamble: Building bundle recommendation agents.


- Plus, many valuable discussions happening inside the community.


Different formats. Same Focus.

Real pricing decisions, not theory.


If you’ve already received an invite and haven’t joined yet, now is the time. Look for ‘PricingTribe’. Pending invites won’t stay open forever.


The value compounds the moment you show up.

Pricing Public Service Announcement. 

The pricing bible "Strategy and Tactics of Pricing" latest edition is probably the most mis priced product on the market. Ironic I know. 

It would actually make Tom Nagle very unhappy (Someone send him this chart). This level of price variation is kind of criminal.. 

Anyways, you can actually be happy. Because globally because of this mis-pricing and cross border/cross platform price matching the paperback masterpiece is almost 60% off in US/CA/UK.. 

US: $87 (Reg $200)
CA: $114 (Reg $272)
UK: 54 GBP (Reg 155 GBP)

Our book club is reading this in Feb. You should too.. 

Highly recommend getting it while quantities last. Btw, no harm in getting previous editions too if this one runs out.

PSA: Head of Pricing for a Wealthtech company.


You will setup deal desk, pricing, and operationalize the pricing transformation for the org. 

Reporting to: CFO

Must have: Software/SAAS pricing experience + Deal Desk

East cost preferred: Boston/Denver/Berwyn(PA)/Raleigh(NC)

If you have the above, or know someone. Do let me know. 

hashtag

#PricingTribe

I am very bullish about AI's use in pricing. 

From what I see inside PricingTribe, other are too. 

A lot of people are building workflows, competition scrapers, pricing tools, recommendation engines etc.. And this is their first project, which means a lot more is coming and the products will keep improving. 

If the last wave to hit pricing was democratizing data, this maybe democratizing skills. 

AI has done what was likely unachievable for most people until recent past. The bar to automation and achieving process efficiency has never been lower. 

The bar for access to knowledge has never been lower either. 

This creates an opportunity to leapfrog in their careers advance their contributions. 

I feel very strongly that AI native pricing professionals will have a huge advantage in the near future. Over time we will know what AI native will mean.. 

Is current AI perfect ? No.

But an imperfect start early > Perfect start late. 

If there was a goal you had in mind about upskilling yourself as a pricing professional, let adding AI capability be that goal. I don't have to tell you how to do it. It's all out there. 

If it was not on your radar, add it now. 


January is 'Building with AI' in PricingTribe. We have show and tells, webinars and office hours. And I am bullish and excited.

If you build it, they will come !! 🏟️

Very excited about the kind of conversations we are having.

Deep, though leadership, with show and learn !!

You know where to find us !

Your invite is maybe in your inbox. 

Bringing waitlist applicants soon.

There is no industry where bad pricing is as apparent as the restaurant industry. 

No surprised 46% of all restaurants fail by year 5. 

If you don't invest in price, sooner or later it'll catch up to you. 

- Not enough price to value
- Not enough coverage for opex
- Over reliance on tips to fund opex
- Don't educate the customers enough
- too much competition based pricing

I do think they can solve most of it by repricing, and resetting customer expectations. 

Reset menu prices to change customer perception, raise the perceived value.  Pay people living wage, and stop the over reliance on tips. Which in itself is a very North American concept only.  

#PricingTribe what do you think ? Do we have a problem in menu pricing ?

Monthly PricingTribe Roundup


First off I am really happy with everything that happened inside the community over the last month and we aren’t even done yet.

We still have Krista Gamble going over her show and tell session showcasing her 'Bundle recommendation agent' she built using AI. 


The place is shaping exactly into what it is: 

- Pressure-test real work
- Learn new pricing strategies
- Get peer feedback, and vendor reco's
- Attend practitioner-led events
- And learn without having to build all of this on your own


So I am very BULLISH and EXCITED about what this place has already become and will become in the future.


Back to what happening inside the community.

This month we had a few events:

- You can watch the recording of Pricing Roundup with Steven Forth and Bill Wilson and Kemal H. Sahin on using AI in pricing. It was a fascinating discussion on AI automation in pricing. Recording can be accessed. 


- Michael Binney Led a fantastic show and tell on Building using AI. You can again watch the recording. He went over a very sophisticated pricing recommendation engine built using AI vibecoding. Highly recommend watching. 

- We had our PricingTribe office hours that was filled with pricing wisdom. Recording available.


WHAT’S HAPPENING IN FEBRUARY

- So we are switching our theme for the next 2 months to focus on Value Based Pricing Strategy which includes selling, pricing and articulating value. 


- So some of the events will be themed around the concept of ‘value’ and what it means to us, how to best capture it in pricing and how its changing now. Live value quantification exercise. 


- A sub theme we will focus on is designing and running an efficient deal desk.  

BOOK CLUB

- We are going to be reading “Strategy and Tactics of Pricing” by Tom Nagle. No one will be required to read the full book, we will divide and read chapters and share learnings in real world context.


What other things are coming soon by March:

- Pricing Pods: These are curated sub groups inside PricingTribe that will have few people inside each pod on the same journey for 12 weeks. For example “Transitioning to consumption pricing”, “Deal desk design and best practices”.

- Member 1-1: I will soon open up the opportunity for members to schedule events themselves with other people or 1-1 with each other. I feel like lot of people want to provide more 1-1 tips from each other. 


It's amazing what's happening inside the tribe. If you applied, an invite maybe in your inbox.

#PricingTribe show and tell.

Today Michael Binney did a show and tell of an amazing pricing intelligence tool for B2B that he vibe coded himself. It brought in several different personna’s and angles into the pricing quote and provided a well triangulated price for the quote.

The art of possible with AI in building tools and workflows for pricing is pretty wide. 

If you haven’t started, no better time to start now.

Pricing and Commercial Lead | Pricing Tribe

Had a fantastic session with the #PricingTribe and Karan Sood this morning.

We explored the intersection of AI "Vibe Coding" and pricing strategy. Specifically, how natural language programming is lowering the barrier to entry for building custom tools. 
It was inspiring to demonstrate how quickly we can now move from a raw idea to a functional prototype.

A big thank you to the community for the open-minded discussion. The seeds of creativity have definitely been planted for the next generation of pricing tools. 🌱

#Pricing #AI #VibeCoding #TechInnovation #Community

Question for Pricing Professionals: What’s changing or going to change in your pricing job that isn’t being discussed enough?

Every team is on a different baseline and every team has different responsibilities. But any information helps ! Chris is doing some good work as always for the #PricingTribe.

The Pricing Recruiter! Recruit for Pricing, LPM, Revenue Management, Deal Desk and More! Founder of SV Pricing Recruiting the top Pricing Recruiting Firm in the US!

We talk a lot about the future of pricing. AI, automation, new skills, new tools.
Before jumping ahead, I want an honest baseline of where pricing actually stands today.

I’m running the State of Pricing survey to understand:
 • How pricing decisions are really made
 • What tools pricing teams actually rely on
 • Where AI fits (or doesn’t) today
 • What’s holding pricing teams back
 • How pricing teams and careers are evolving

There are no right or wrong answers.  Just the reality of the pricing profession.

If you work in pricing, I’d really value your perspective.

👉 TAKE THE SURVEY (8–10 minutes)
https://lnkd.in/giaUApDq

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The Battle

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