Value-based pricing focuses on setting price points based on the customer's perceived value of the product, allowing for flexibility according to demand and features offered.
More companies are adopting value-based pricing as it allows them to charge what customers are willing to pay, rather than just reflecting the cost of delivery or competitor pricing.
Unlike outcome-based pricing, which scales prices according to the results delivered, value-based pricing centers on customer perception and willingness to pay, maximizing profitability.
For example, Uber employs value-based pricing by increasing fares during high-demand times, like New Year’s Eve, reflecting the heightened customer value on getting home safely.
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