Price and the story it tells

Question: Why are balloon prices up? Answer: Inflation.

Question: Why do cemeteries keep raising their prices? Answer: I don’t know, but you can blame the cost of living.

And here’s the last entry for today’s daddy jokes list: “I’ve always wondered about the price of pies around the world: In the Bahamas, they’re $9 a pie.

In Jamaica, they’re $8 a pie. In Cuba, they’re $7 a pie. And those are the ‘pie rates’ of the Caribbean.”

In the business world, price is more than just a number – it’s a narrative, a signal, and a reflection of your strategy. As entrepreneurs and leaders, understanding how price shapes perception can transform your sales and customer relationships. Here’s a fresh take on pricing strategies, their implications, and how empathy and generosity can redefine value in today’s marketplace.

“Price is a story we tell ourselves about worth,” as someone once said. A lower price doesn’t necessarily mean better value, and the common assumption that cheaper equals more demand oversimplifies the complex interaction between supply, demand, and perception.

Consider this: Is your product a commodity or a unique offering with a story behind it? Commodities compete on price, but thriving businesses tell a different story that resonates with customers on a deeper level. “It’s like last time, but cheaper” might be an easy pitch but also uninspired. A compelling narrative, on the other hand, elevates your offering beyond price wars.

Price is always a reflection of perceived value. The more you pay, the more value you would expect to receive. If the perceived value doesn’t meet expectations, the business will be in trouble. The price demanded for your goods or services must align with the value you deliver. However, you must be generous and work hard to provide value that surprises, delights, and impresses customers. This way, they will reward you with the customer loyalty you strive for.

Yes, you need to be generous. Generosity in business doesn’t mean giving away your products or services for free. Instead, it’s about delivering more emotional and functional value than expected. Generous work is insightful, urgent, and selfless. It’s the difference between solving a problem and merely selling a product.

Here’s the philosophy for generous work: “You’ll pay a lot, but you’ll get more than you paid for.” It’s about crafting an experience that says, “I see you, and I care.” Customers who feel valued don’t mind paying a premium because they trust that the outcome will exceed their expectations.

Take luxury goods, for example. Their appeal often lies in intentional waste. People buy expensive items not because they offer the highest utility but because the price symbolizes exclusivity and status. One witty observer noted, “Luxury isn’t about needing it; it’s about wanting everyone to know you can afford not to need it.”

Pricing is never just about the initial sticker price. For example, consider adopting a puppy – it may cost twelve thousand pesos upfront, but the actual cost includes years of food, chewed-up shoes, vet bills, and professional carpet cleaning. Similarly, the true value of a product or service often lies in the ongoing costs and benefits it delivers over time. Competent managers look beyond price to understand the total cost of ownership. They focus on the bigger picture – long-term customer satisfaction and the ripple effects of investing in quality.

Business strategies thrive on empathy. Empathy allows us to understand customers’ needs without judgment, helping them solve problems in ways they already desire. Often, the key to success isn’t convincing others to see things your way – it’s helping them reach the goals they’ve envisioned for themselves. Customers who care more about price than value are unlikely to become loyal advocates. Instead, focus on customers who view pricing as an investment in solving their problems.

Pricing isn’t just about how much people are willing to spend; it’s about how much they’re willing to trust. Your pricing strategy must reflect value, confidence, and mutual respect in order to gain trust.

Here are some thoughts to leave you with as you reflect on pricing and its broader implications:

“Cheaper is the last refuge of a marketer with nothing to say.” Create value that speaks louder than discounts.

“Generosity is expensive, but it’s the best investment.” People remember how you made them feel long after they forgot how much they paid.

“Help others feel right, and you’ll make progress.” Strategy is about guiding, not coercing.

Pricing isn’t just about transactions; it’s about trust, empathy, and the value you provide. As we shift our focus from price tags to purpose, let’s remember: Price is the story we tell, and it’s up to us to make it worth believing. Yes, price tells a story.

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Francis Kong’s “Inspiring Excellence” podcast is now available on Spotify, Apple, Google, or other podcast streaming platforms.