What are the three pillars of a pricing structure?

Multi-segment strategy: selling at the right price to each customer
A company that offers its product at a single price is trying to maximize its revenue from the midpoint. For example, if a price of $50 is set, 50 units may be sold, generating $2,500 in revenue. Moving the price up or down reduces total revenue: at $60, 40 units would be sold and $2,400 collected; at $70, only 30 units and $2,100. The same happens if the price is lowered: at $40, 60 units would be sold and $2,400 collected; at $30, it would be 70 units and $2,100.

At first glance, it may seem that $50 is the optimal price. But this conclusion is incorrect.

The real potential is reached with a multi-segment strategy, where different prices are charged to different groups of customers. For example, selling 20 units at $80, another 20 at $60, then 20 more at $40, and the last 20 at $20. With this segmentation, revenue reaches $4,000, far surpassing the $2,500 from a single price.

Of course, it is essential to prevent all customers from ending up paying the lowest price, which would reduce revenue to just $1,600. How to avoid that will be the subject of an upcoming lesson.

Price–value relationship: the map that guides the strategy
The second pillar establishes that each solution in the portfolio must be aligned with its perceived value. Higher-value products should have a higher price, and lower-value products a lower one.

When this relationship is not respected, two problems arise: expensive products that do not sell, or cheap products that leave money on the table. To prevent this, the value map is used.

This map positions products according to their price and perceived value, graphically representing what the fair price should be. For example, when comparing several disinfectants (X, Y, and Z) with a water-saving product, key attributes are scored and weighted according to their importance. This produces a total perceived value for each product.

By drawing a fair-price line with a linear regression and placing the water-saving product on it, you can estimate what its competitive price should be. In the example, that fair price is $1.20.

Self-segmentation: when the customer chooses their price
The third pillar is self-segmentation. This principle states that it is not the company that defines which segment each customer belongs to, but the customers themselves, depending on the conditions they are willing to meet.

A story from the animal world illustrates this perfectly. In a chick farm where roosters and hens lived together, the owners faced the challenge of feeding them differently without separating them. They took advantage of two anatomical differences: roosters are taller and have larger heads.

They installed hanging feeders. The high ones were accessible only to the roosters, and the low ones, with narrow grids, allowed only hens to insert their heads. This way, each group accessed the feed intended for them without additional intervention.

This example shows how self-segmentation works in pricing: customers choose the price option that fits their sensitivity, meeting certain conditions to access better rates or discounts.

Conclusion: a structure designed to capture more value
A solid pricing structure is not based on a single price, but on a flexible and strategic design. It must offer multiple prices to capture different sensitivities, maintain coherence between the value delivered and the price charged, and allow customers to self-segment.

However, one important question remains: how can different prices be charged for the same product or service? The answer will come in the next lesson, when we explore the creation of differentiated versions of our solutions.