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August 15, 2023
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Most service business owners price by accident. They charge what they think is fair, what competitors charge, or what fits their hourly rate. None of these approaches work. A pricing strategy is the deliberate framework you use to set and justify your prices, based on the value you deliver and the business you want to build. In this article, Robin Waite walks through what pricing strategy actually is, why it matters more than the tactics, and how to build one using his M.O.N.E.Y. Framework and Pricing Auction.
A few years ago I sat down with a web designer who was working 60-hour weeks and still couldn't pay herself a decent salary. She was brilliant at what she did. The problem wasn't her skills. It was her pricing. She was charging by the hour, undervaluing her work, and trapped in a cycle of taking on more clients just to hit her revenue goal.
Her story is almost universal among coaches, consultants, and freelancers. They have a problem. It's not a pricing problem. It's a strategy problem.
Pricing strategy is the deliberate framework you use to set prices for your products or services, based on the value you deliver, the clients you serve, and the business you want to build. It's not a tactic like "offer 20% off" or "match what your competitors charge." It's the foundational decision that shapes everything else in your business.
Strategy answers the question: What is this work actually worth, and who should pay that price? Tactics execute the strategy once it's clear.
Most service business owners skip strategy and go straight to tactics. They charge hourly because it feels fair. They lower prices when a prospect hesitates. They add discounts to win deals. All of these are symptoms of no strategy.
When you have a pricing strategy, you lead your market instead of reacting to it. You attract clients who value the outcome, not the cheapest option. You work with fewer people for more money. And you have the time and resources to deliver better results, which makes you more referable.
The truth is: pricing strategy is not about the numbers. It's about business design. Design a business that works for you, not the other way around.
Every pricing model falls into one of four categories. Understanding each one helps you choose deliberately instead of by accident.
Cost-plus pricing means calculating your direct costs (materials, time, overhead) and adding a profit margin on top. A freelancer charges £50/hour plus 50%, so £75/hour. A product costs £10 to make and sells for £25.
Cost-plus is simple and feels mathematically fair. The problem: it anchors price to your costs, not to the value delivered. If you get faster at your work, you earn less. If your overheads drop, your prices should drop. Clients don't care what it costs you to deliver. They care about what they get.
Most service businesses use cost-plus by accident when they charge hourly rates. It's the default for people who don't have a strategy.
Value-based pricing sets the price based on the outcome delivered to the client, not the inputs (time, effort, materials). A coach charges £5,000 for an eight-week programme that helps a client double their revenue. A web designer charges a fixed fee to deliver a site that generates 12–15 qualified leads per month.
Value-based pricing decouples your earnings from your time. It rewards expertise, systems, and efficiency. It also makes clients happier because they're buying an outcome, not an hour of your attention.
Robin's philosophy: if you are not an expert there is no way you can justify high prices. Value-based pricing requires that you are genuinely expert in your field.
Competitive pricing means matching or underpricing competitors. "The market rate for web design is £1,500, so I'll charge £1,200 to stand out."
The problem: you don't know if competitors got it right. You don't know their costs, their positioning, or their ideal client. Matching their price means accepting their assumption about what the work is worth. You are not building a strategy; you are following someone else's.
Competitive pricing leads to race-to-the-bottom thinking. Over time, everyone in the market charges less and less, including you.
Dynamic pricing changes based on demand, seasonality, or context. Flights cost more during school holidays. Early-bird rates are lower than last-minute prices. Penetration pricing is a specific version: charge a lower price to win market share quickly, then raise prices once you have traction.
Dynamic pricing is sophisticated and requires volume to work well. It's typically used by product companies, SaaS businesses, or any business with high transaction volume. For a service business with 10–20 clients per year, dynamic pricing creates confusion and relationship damage.
The four pricing models above are tactical choices. Before you choose one, you need a framework that rewires how you think about pricing. That's where the M.O.N.E.Y. Framework comes in.
The M.O.N.E.Y. Framework is Robin's organising principle for everything to do with pricing. It's the spine of his pricing methodology. Work through each letter in order.
What you believe about money drives your pricing behaviour. Most undercharging is not a numbers problem. It's a belief problem. You don't believe you're worth it. You think customers won't pay. You worry about the gap between your price and competitors' prices.
Before you touch a single number, rewire your beliefs. What stories about money did you inherit? What did your parents say about pricing? Do you believe rich people are greedy? Do you think charging high prices is unethical?
Until you fix mindset, any price you choose will feel wrong.
Create offers that align with value, not just time for money. Package your services into products. Define a Dream Outcome (the remarkable result your client gets). Put a timeframe on it. Charge a fixed fee.
This is productisation. Strip back your offer and rebuild it strategically. Instead of "I offer coaching," it's "I run an eight-week programme that takes coaches from working 50+ hours a week to working 20 hours and doubling income."
The offer statement matters because it changes how prospects evaluate price. They're not buying hours. They're buying transformation.
Sales conversations are where pricing strategy comes to life. You must be able to pitch your price without waffling, second-guessing, or folding when a prospect pushes back.
This means understanding buyer psychology, handling objections, and knowing that "Price, Product, or Person" are the only three reasons prospects reject an offer. Master the 6-Step Sales Formula if you want to nail this piece.
Pricing power is the ability to charge premium prices without losing deals. It comes from building authority, trust, scarcity, and positioning. Pricing power isn't about being cheapest. It's about being the only one they're considering.
Elevate your pricing power by investing in your expertise, building your brand, and being selective about who you work with. Clients pay more for specialists.
Own your pricing philosophy. Stop bending your business to fit other people's budgets. Stop discounting because someone asks. Stop raising prices when you feel guilty.
When you set the rules, you set yourself free.
Once you understand the M.O.N.E.Y. Framework, here's how to apply it to your business.
What is the remarkable result your client gets from working with you? Not the features of your offer. The transformation. The outcome. The change they experience.
For a business coach, it might be "Go from working full-time in the business to working on the business, with double the income in 12 months." For a designer, it might be "A brand system so clear that every piece of client communication looks intentional and professional."
Your Dream Outcome is specific enough that a prospect can picture it, and measurable enough that you can prove you delivered it.
Where do you sit in the pricing bandwidth? The pricing bandwidth is the principle that the same product sells at wildly different prices to different buyers who all think it's fair.
Coaching ranges from free (YouTube videos) to £49–297 (DIY courses) to £200 per session (value-based) to £3–5k (fixed packages) to £100k+ (premium) to £1m (Tony Robbins tier). You need to pick your band and own it. Don't try to be everything to everyone.
The Pricing Auction is a body-led exercise. You don't solve pricing intellectually. You listen to your body.
Here's how it works: write down your product and the price you think it should be. Gradually increase the price, hitting four-figures using 2s, 5s, and 8s as significant thresholds. Listen to your body. When you feel a knot in your stomach, you've just crossed your comfort zone. That knot is your price.
The typical result: clients land at 2.5x their original price. Your body knows what you're worth. Your head is the thing holding you back.
Commit to pitching your new price to your next ten prospects. At 2.5x the original, you'll get some rejections. That's expected. Get to ten pitches before you panic.
After ten pitches, look at the data. How many said yes? Did they all say no? Did you get a mix? Use that data to adjust. Maybe your price is right but your offer isn't clear. Maybe you need to narrow your niche. Maybe you need to improve your pitch.
Don't cut price before you understand whether the problem is price, product, or person (you).
This approach assumes you are an expert or building toward it. If you're brand new to your field and learning as you go, you're not ready for premium pricing yet.
This also assumes you have capacity to be selective. If you're desperate for any client, you're not ready to stand firm on price. Get to a place of financial stability first. Then build your strategy from that place of strength.
And this is not a get-rich-quick framework. Pricing is one lever. You also need great delivery, good marketing, and the ability to attract and close ideal clients. Pricing strategy accelerates a solid business. It doesn't fix a broken one.
Cost-plus (price equals cost plus profit margin), value-based (price based on outcome delivered), competitive (price matched to competitors), and dynamic/penetration (price varies by demand or market position). Value-based pricing is best for service businesses.
A pricing strategy includes three elements: mindset (your beliefs about money and pricing), offer (the package and Dream Outcome you deliver), and confidence (your ability to pitch and defend your price without folding).
The traditional 7Ps framework is a marketing model, not a pricing strategy. Robin's M.O.N.E.Y. Framework (Mindset, Offer, Negotiate, Elevate, Your worth) is more relevant for service businesses building a pricing strategy from scratch.
Yes, for service businesses. Value-based pricing decouples your earnings from your time and aligns price with the outcome. Hourly rates reward your speed instead of your expertise and keep you trapped in the Sales Cycle of Doom. Raise your prices. Back yourself. Be fearless.
