Pricing wiki · Category
Understanding Value & Customers
How to work out what a customer is worth and what they will pay: ICP, jobs to be done, value drivers, EVE, willingness-to-pay research, segmentation, and the fences that hold tiers apart.
- Published concepts
- 9
- Updated
- Jul 2026
Category index
Explore concepts
Start with the decision you need to make, then use the connected concepts to test the logic underneath it.
Ideal Customer Profile (ICP)
A hypothetical description of the account type that derives the most value from your product and provides the most value back to your business.
Customer Use Cases
Structured descriptions of the problem, persona, context, and outcomes that define how customers get value from your product and how you should price.
Jobs to Be Done (JTBD)
A demand lens that defines customers' 'progress' in context, so you can shape messaging, onboarding, packaging, and pricing around real switching triggers.
Value drivers
The specific product benefits that create utility and drive a customer's Willingness to Pay (WTP).
Economic Value Estimation (EVE)
A structured method to quantify monetary value vs the next‑best alternative so you can set value‑based prices.
Value Decoder framework
A framework for turning perceived customer value into a defendable price band by anchoring on the next-best alternative and adjusting for context.
Willingness to Pay (WTP)
WTP is the maximum price a buyer accepts; use it to set a defensible price range, design tiers, and validate pricing against unit economics.
Segmentation by Willingness to Pay (WTP) / Use Case
Partition customers by jobs-to-be-done and willingness to pay, then package and price to capture maximum value.
Price fences / price discrimination
A strategic framework for charging different customers different prices based on their willingness to pay, without triggering a PR backlash.
Editorial guide
Use this category
These notes preserve the category’s recommended sequence, decision rules, and practical applications.
Which page should you start with?
Match your situation to the page that addresses it directly — these pages are sequential, but almost nobody needs to read all nine.
| Your situation | Start here | Why |
|---|---|---|
| "We sell to anyone who'll buy, and pricing conversations go badly" | Ideal Customer Profile | Pricing power depends more on which customer you serve than on what you built. |
| "Two customers who look identical pay us wildly different amounts" | Jobs to Be Done | The worked example shows a 10x WTP gap between two accounts with identical firmographics. |
| "We know who buys but not what problem we're being hired for" | Customer Use Cases | Pins down the context and the alternative — both inputs to every price you'll set later. |
| "Our deck lists twelve benefits and the buyer weighs them all equally" | Value Drivers | Find the two or three drivers carrying most of the quantified value, then lead with those. |
| "We need to defend a premium to a procurement team" | Economic Value Estimation | Builds the reference-value-plus-differentiation stack that survives a spreadsheet review. |
| "The economics justify our price but buyers still won't pay it" | Value Decoder framework | Perceived value includes things EVE doesn't count — context, timing, symbolism, risk. |
| "We picked our price by looking at competitors and rounding" | Willingness to Pay | Compares Van Westendorp, Gabor-Granger, and conjoint so you pick the method that fits the question. |
| "One price is clearly leaving money on the table" | Segmentation by WTP / Use Case | Works out what each additional price point is actually worth — and where it stops paying. |
| "We have tiers, but everyone buys the cheap one" | Price fences | Tiers without enforceable fences collapse to the lowest price. This is the fix. |
How to use this
New to value-based pricing?
Read in order: ICP → JTBD → value drivers → EVE → WTP. Each one supplies an input the next one needs. Segmentation and fences come after you have a value model, not before.
Working on a live pricing problem?
- Find your situation in the table above and read the one or two pages that match.
- Quantify against the buyer's actual alternative — not against your cost, and not against a competitor's list price.
- Decide how much of the quantified value you keep. Capturing much beyond 70% is where deals start to stall.
- Before adding any tier, confirm you have a fence that holds it.
The order these actually run in
Pricing is not a one-time project. In practice this category cycles: refine ICP and jobs → map value drivers → quantify with EVE or the Value Decoder → measure WTP → segment and fence → and back, as the market moves. Teams that skip straight to segmentation without a value model end up with tiers they cannot explain to a customer.
Continue through the library
Related categories
Move to the adjacent pricing decision without losing context.
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