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Pricing Methodologies
- Value-led pricing prioritizes perceived customer value.
- Cost-led pricing prioritizes internal costs.
Contextual Pricing
- The price of bottled water varies depending on the context, like a convenience store versus a sporting event.
- This shows how price is contextual and based on perceived value, not just cost.
Price Affects Cost
- Price affects cost, not the other way around.
- Setting a price justifies future cost expenditure, challenging the cost-plus pricing model.