In most businesses I've worked with, pricing gets decided in a spreadsheet. Costs, plus a margin, rounded to something that looks reasonable. Then it gets handed to marketing with a simple brief: make people pay this.
I think that's backwards. Price is one of the loudest things a business says about itself. It belongs in the marketing conversation from the start.
Your price tells people what to expect
Before a customer reads a word of your website, the price has already told them a story. Cheap says simple, basic, maybe risky. Expensive says premium, careful, worth it. Somewhere in the middle often says nothing at all.
If your marketing says premium and your price says bargain, people trust the price. If your marketing says friendly and affordable and your price is the highest in town, they'll feel tricked. The two have to tell the same story.
Cost plus margin ignores the customer
Pricing from your costs answers the question "what do we need to charge?" It doesn't answer "what is this worth to the person buying it?"
Those numbers are often far apart. A service that saves a business owner ten hours a week is worth a lot more to them than the cost of delivering it. When you price from cost, you leave that gap on the table, or you end up competing on price with businesses whose offer is genuinely worse.
Start from the customer and work back
A better order goes like this:
Who is it for? A specific customer, not everyone.
What problem does it solve, and what is that problem costing them? Lost time, lost sales, stress, risk.
What would they compare it to? Another provider, doing it themselves, or doing nothing.
What price makes sense against that comparison?
Can we deliver it profitably at that price? If not, change the offer, not just the number.
Costs still matter. They just come last, as a check, rather than first, as the answer.
How you show the price matters as much as the number
Presentation is marketing too. A single clear price feels confident. A page of options and add-ons feels like a negotiation. "From $X" invites people to assume the final bill will be higher.
Packaging changes perception as well. The same service sold as a monthly plan, a one-off project or a result-based fee will attract different customers and set different expectations. I’m working through this with Cushy Digital, where the pricing model is as much a part of the offer as the product.
A question to ask before your next price change
Before you raise or lower prices, ask your marketing person, or yourself in your marketing hat: "What does this price say about us, and is that what we want people to hear?"
If nobody can answer, the price is probably still living in the spreadsheet.
The take
Pricing isn't just maths. It's a message, and often the first one a customer reads.
Set it from what the customer values, check it against your costs, and make sure your marketing tells the same story.
Common questions
Why is pricing a marketing decision?
Price tells customers what to expect before they read anything else. If your price and your marketing tell different stories, people believe the price.
How should a small business set its prices?
Start with who it's for, what the problem costs them and what they'd compare you to. Set a price that makes sense against that, then check it works for your costs.
Does the way I present price matter?
Yes. A single clear price feels confident, a page of options feels like a negotiation, and packaging such as a monthly plan or a one-off fee attracts different customers.
Got an idea, a question or a guest for Off The Record?
Send me a message. If it's help with your marketing you're after, that happens through Cushy Digital.