Monday Price Point: My first principle of pricing: Price the customer, not the product.

Your product doesn’t have value on its own—it only has value in the context of helping your customer get something done. And it’s that “something,” multiplied by the degree of “done,” that creates value.

A train isn’t valuable. The transportation of your six 40-ft containers from Chicago to New York, arriving Wednesday, is. And that particular value of those particular containers on that particular trip has unique value—to you, the customer. Another customer, with different containers and needs, might get more—or less—value from the same trip.

This is what we try to solve for when we “do pricing”: we price the customer.

And fundamentally, we have two major toolboxes to work with:

• Packaging: how we define what the customer can actually buy
• Pricing: how we want to get paid—and how much (Yes, confusing that “pricing” includes both packaging and pricing—but that’s just how the terms are used.)

What most people miss is that Packaging is more powerful than Pricing.

Why? Because the core function of Packaging is to understand the customer’s Job To Be Done—and deliver on it.

It’s in the “Door-to-door container service for dangerous goods, guaranteed arrival by Wednesday” that we really connect with a customer and what she wants done—not in the ”$12 per container per mile + $500 loading fee.”​

There’s a bit more nuance, but generally:

• Packaging: delivers value to the customer
• Pricing: extracts value from the exchange

Now, pricing can also indirectly deliver value when it aligns with customer outcomes—think Domino’s “30 minutes or it’s free” guarantee, or Agentic AI tools pricing based on specific outcomes like “leads delivered” or “support tickets handled.”

But typically, pricing only supports the inherent value that’s built through great packaging.

In our client work, we spend 3–4x more time on packaging than on pricing.

How to do it:

Get 3-4 people in a room—make sure Sales and Product are both represented.

Discuss what outcomes your customers are actually trying to buy from you. Then build packages around that.

A few tips:

• “People don’t buy drills-they buy holes.” What is our customer’s hole?
• Distinguish between the User and the Buyer on the customer side. Focus on the Buyer for new sales, and the User for expansion sales.
• Ask “Why?” at least 3 times. “People want hiring to be easier.” Why? Why? Why?

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