# Biz pricing strategy Human Guide

## What This Is For
Pricing is the only marketing mix element that generates revenue — all others are costs. It gives the agent a clearer input/output frame for go-to-market work: what context to ask for, what decisions to make, and what usable artifact to return.

Use this as a human-readable version of the Biz pricing strategy agent skill. It is meant for marketers, operators, founders, and other non-coders who want the workflow without reading agent-specific implementation instructions.

## When To Use This
- Use this when you need a repeatable process for biz pricing strategy.
- Use this when the task needs judgment, examples, constraints, or a clear output format rather than a one-off prompt.
- Use this when you want to hand an AI assistant enough context to produce a usable marketing artifact.

## When Not To Use This
- Do not use this when you only need a quick factual answer.
- Do not use this when the work depends on private data you cannot share with the assistant.
- Do not use this as a replacement for legal, compliance, financial, or medical review.

## What You Need Before Starting
- The goal or business outcome you want.
- The audience, customer segment, or market context.
- Any source material the assistant should respect, such as notes, briefs, examples, URLs, or brand guidance.
- Constraints such as tone, length, channel, deadline, region, or approval requirements.
- A clear definition of what a good final answer should look like.

## Step-By-Step Workflow
1. State the job clearly: "Use the Biz pricing strategy guide to help me with..."
2. Add context: audience, goal, offer, channel, source material, and constraints.
3. Ask the assistant to identify missing inputs before producing the final output.
4. Have the assistant follow the skill-specific guidance below.
5. Review the result against the final checklist and ask for revisions where needed.

## Skill-Specific Guidance
- User setting prices for a new product
- User evaluating whether current pricing is optimal
- User asks "how much should we charge?" or "why are our margins low?"
- User needs to choose between pricing models (subscription vs one-time, freemium vs premium)
- For comprehensive financial analysis → use financial ratios or DCF
- For customer segmentation → use STP
- For cost structure analysis → use Value Chain
- **Van Westendorp**: Survey-based method — ask customers "at what price is this too expensive / too cheap / a bargain / getting expensive?"
- **Gabor-Granger**: Show a price, ask if they'd buy. Vary the price across respondents.
- **A/B test**: If possible, test two price points with real transactions
- Track **price elasticity**: % change in demand / % change in price
- Monitor **competitive response**: Did competitors match your price?

## Decision Points And Nuance
The original skill emphasizes: Overview, When to Use, Framework, Step 1: Understand the Three Price Anchors, Step 2: Choose a Pricing Approach, Step 3: Apply Psychological Pricing Techniques, Step 4: Validate with Price Sensitivity Analysis, Step 5: Monitor and Adjust, Output Format, Three Anchors.

Use these questions to steer the work:
- What is the intended audience or buyer?
- What source material must be preserved?
- What should the assistant optimize for: clarity, persuasion, accuracy, speed, creativity, or conversion?
- What examples represent the desired quality bar?
- What should the assistant avoid?

## Common Mistakes
- Every price change must be evaluated through BOTH a financial lens
- Less reliable for products respondents have never bought before
- Elasticity of −1.67 means **elastic** above NT$399 — demand drops faster than price rises. Avoid pricing above NT$399.
- Do not optimize for conversion rate alone. Compare **revenue per visitor**:
- **Peeking**: checking results before reaching required n inflates false positive rate. Commit to the sample size before starting.
- **Temporal confounds**: do not run over a promotional period, major holiday, or competitor campaign.
- Is viral/word-of-mouth adoption important to your growth model?
- **Warning**: A 1% conversion rate is not a failure if free users are also a referral engine. Model the referral-adjusted CAC.

## Copy-And-Paste Prompt
```text
Use the Biz pricing strategy human guide.

My goal:
[Describe the business outcome]

Audience:
[Describe who this is for]

Context and source material:
[Paste notes, examples, links, or existing copy]

Constraints:
[Tone, length, channel, timeline, must-include items, must-avoid items]

Before producing the final output, ask me for any missing information that would materially improve the result.
```

## Final Checklist
- [ ] The output matches the original goal.
- [ ] The audience and context are reflected in the answer.
- [ ] Important constraints and source material were preserved.
- [ ] The assistant made the relevant decisions explicit.
- [ ] The final artifact is ready to use, review, or hand to the next person.

## Source
This guide was generated from the asgard-ai-platform/skills skill entry for `biz-pricing-strategy`.

## Source Skill Notes
These notes preserve the nuance from the original skill. Use them as supporting reference when the workflow above feels too generic.

# Pricing Strategy

## Overview

Pricing is the only marketing mix element that generates revenue — all others are costs. This skill covers five pricing approaches (cost-plus, value-based, competitive, penetration, skimming) plus psychological pricing techniques. The right approach depends on the product lifecycle stage, competitive landscape, and customer price sensitivity.

## When to Use

**Trigger conditions:**
- User setting prices for a new product
- User evaluating whether current pricing is optimal
- User asks "how much should we charge?" or "why are our margins low?"
- User needs to choose between pricing models (subscription vs one-time, freemium vs premium)

**When NOT to use:**
- For comprehensive financial analysis → use financial ratios or DCF
- For customer segmentation → use STP
- For cost structure analysis → use Value Chain

## Framework

```
IRON LAW: Price Communicates Positioning

Price is not just economics — it's a signal. Lowering price to compete
can permanently reposition a brand as "cheap." Raising price without
value justification creates distrust.

Every price change must be evaluated through BOTH a financial lens
(margins, volume) AND a positioning lens (what does this price say about us?).
```

### Step 1: Understand the Three Price Anchors

Every pricing decision sits between three constraints:

| Anchor | What It Sets | Method |
|--------|-------------|--------|
| **Cost floor** | Minimum viable price | Cost analysis — below this, you lose money |
| **Competitor reference** | Market expectations | Competitive benchmarking — what alternatives cost |
| **Customer ceiling** | Maximum willingness to pay | Value research — what the customer thinks it's worth |

### Step 2: Choose a Pricing Approach

| Approach | How It Works | Best When |
|----------|-------------|-----------|
| **Cost-Plus** | Cost + fixed margin % | Commodity products, government contracts, stable costs |
| **Value-Based** | Price based on customer's perceived value | Differentiated products, strong brand, measurable customer benefit |
| **Competitive** | Match or undercut competitor prices | Undifferentiated market, price-sensitive customers |
| **Penetration** | Start low to gain market share, raise later | New market entry, network effects, high switching costs |
| **Skimming** | Start high, lower over time | Innovation leader, early adopters willing to pay premium |

### Step 3: Apply Psychological Pricing Techniques

| Technique | How It Works | Example |
|-----------|-------------|---------|
| **Charm pricing** | End in 9 or 99 | NT$299 instead of NT$300 |
| **Anchoring** | Show a higher price first, then the actual price | "Was NT$1,200, now NT$799" |
| **Decoy effect** | Offer three options where the middle is the intended choice | Small NT$99, Medium NT$149, Large NT$159 (Large looks like a deal) |
| **Bundle pricing** | Combine products at a discount vs individual purchase | "All 3 for NT$999" (vs NT$450 each) |
| **Freemium** | Free basic tier, charge for premium features | Spotify, Notion, Canva |

### Step 4: Validate with Price Sensitivity Analysis

Before committing:
- **Van Westendorp**: Survey-based method — ask customers "at what price is this too expensive / too cheap / a bargain / getting expensive?"
- **Gabor-Granger**: Show a price, ask if they'd buy. Vary the price across respondents.
- **A/B test**: If possible, test two price points with real transactions

### Step 5: Monitor and Adjust

After launch:
- Track **price elasticity**: % change in demand / % change in price
- Monitor **competitive response**: Did competitors match your price?
- Watch **customer perception**: Did the price signal what you intended?

## Output Format

```markdown
# Pricing Strategy: {Product/Service}