STEP 3.3: A CASE STUDY
Prices His Products
Leo has defined his product line. Now comes the moment of truth: putting a price on that value. He is determined to set prices that are fair, sustainable, and reflect the quality of his craft.
The Challenge
Leo knows his materials and time are valuable, but what is a fair price for a wallet that's designed to last a lifetime? He's afraid of pricing too high and scaring people away, but also knows he can't compete with mass-produced prices.
The Action
Leo follows the 'Value-Based Pricing' Game Plan to calculate his prices.
1. Analyze Competitor Pricing
Leo finds that other high-end, handcrafted leather wallets from small makers range from $120 to $250. This gives him a "price window" to work within.
2. Assess Transformative Value
Looking at his Core Offer, Leo quantifies the value: a customer might spend $20-$40 on a new wallet every 2 years. Over 10 years, that's $100-$200 on low-quality products. His wallet is an investment that avoids that cycle.
Aha Moment: His wallet isn't a cost; it's an investment that saves money and frustration over the long term.
3. Set The Prices
Based on the research and value assessment, Leo sets prices with confidence.
The Outcome
By following a value-based process, Leo creates a pricing strategy he can stand behind. He's not just charging for leather and thread; he's charging for longevity, craftsmanship, and peace of mind.
Leo's Final Pricing
- Entry-Level Offer (Keychain): $25
An accessible entry point to his brand's quality. - Core Offer (Wallet): $150
Positioned as a premium, long-term investment. - Premium Offer (Custom Bag): $1,500+
Reflects the bespoke nature and high material/labor costs.