Shifting Focus from Pricing to Value Creation

Okay, this is a lengthy one, BUT if you run a creative agency or design studio - stick with me. Creative pricing has evolved in three clear waves. First came time-based billing—a legacy of the industrial era. We sold labour by the hour. Output was tied to effort. More time, more cost. This rewarded slowness, penalised efficiency, and treated creativity like a factory line. Then came value-based pricing. A smarter shift. Instead of billing for time, agencies priced according to the business impact they could create. Strategy held weight. Outcomes mattered. It was a breakthrough, but still rooted in the idea of fixed deliverables and measurable returns. Now, we’ve entered a third era. One where value isn’t just in the outcome—it’s in the system that produces outcomes at scale. AI changed the equation. Creative work has decoupled from time. Velocity no longer depends on headcount, and value no longer follows effort. Tools can generate what once took weeks in minutes. The bottleneck is no longer execution. It's strategic alignment. The central question has shifted from “how fast can we make this?” to “how accurately can we define what should be made—and why?” And that brings us to what I'm calling the "Generative Value Model": Strategic clarity is more valuable than labour. Systems and setup represent the new creative product. Inputs, when structured well, yield scalable and exponential outputs. In GVP, clients are not paying for outputs in the traditional sense. They are paying for what those outputs enable. The briefing and strategic alignment phase must be treated as a core value driver. Execution becomes a byproduct of earlier decisions, not the primary value centre. Pricing should reflect acceleration potential, not production effort. This is not a cost-cutting model. It is a performance-scaling one. Agencies that embrace this approach are moving away from quotes based on time or deliverables. Instead, we are framing their value in terms of impact velocity—how quickly and effectively wew can align, generate, and adapt. We are not being paid to deliver. we are being paid to initiate momentum. And that shift doesn’t just change how we price—it rewrites the entire model of what a creative agency is. (duh) The Generative Value Model marks a new era. An era where strategic clarity is more valuable than volume. Where creative SYSTEMS - not manpower -become the multiplier. This changes how we scope, how we hire, how we measure success, and how we lead clients through transformation. After three years building this model inside real client work, testing it across industries, and running one of the first truly generative-first creative agencies, I’m tryyying to write the book on it. A practical field guide for agency and studio owners who are just setting foot on this new playing field. Comment below if you want early access. & Signup for my (very) sporadic newsletter for a LOT more https://lnkd.in/gB2Z-n32 Love you!

Price is never just a figure. It represents how the market perceives the value you deliver. When businesses start thinking this way, they stop racing to the bottom and begin leading with clarity and purpose. That is where lasting profitability begins. Many companies still assume customers base their decisions on price alone. That assumption has cost them significantly. When I started helping businesses uncover what their customers truly value, everything shifted. I saw companies dramatically increase their growth and improve margins by 25 to 40 percent. This success didn’t come from cutting expenses, but from aligning pricing with real customer value instead of relying on guesswork. At Sjöfors & Partners - Pricing for Profits and Growth, we created a process that combines value research, predictive analytics, and artificial intelligence to identify what motivates a customer to buy and what they are genuinely willing to pay. The focus is not on being the lowest priced option. It is becoming the most valued option. When companies understand this, profitability naturally follows. #PricingStrategy #ValueBasedPricing #ThoughtLeadership #BusinessGrowth #Profitability #CustomerCentric

The No. 1 mistake I see service providers make. Trying to win clients by being “affordable.” It feels logical at first: 🎯 Lower prices → More clients → Bigger business But here’s the harsh truth: Low prices = low value perception. And when people see you as a “bargain option,” they’ll treat you that way: 👉 Negotiating every penny 👉 Questioning your expertise 👉 Overloading you with scope creep I’ve been there. Back when I started, I was scared to charge more. I thought I’d lose clients. I thought I wasn’t “ready.” But here’s what happened when I made the shift: 1️⃣ 𝗠𝘆 𝗰𝗼𝗻𝗳𝗶𝗱𝗲𝗻𝗰𝗲 𝘀𝗼𝗮𝗿𝗲𝗱 𝘁𝗼 𝗻𝗲𝘄 𝗵𝗲𝗶𝗴𝗵𝘁𝘀. Charging more forced me to deliver at a higher level; and my clients got better results. 2️⃣ 𝗜 𝘀𝘁𝗼𝗽𝗽𝗲𝗱 𝗮𝘁𝘁𝗿𝗮𝗰𝘁𝗶𝗻𝗴 𝘁𝗶𝗿𝗲-𝗸𝗶𝗰𝗸𝗲𝗿𝘀. The clients who were serious about their goals didn’t blink at the price. hey showed up ready to work. 3️⃣ 𝗠𝘆 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗴𝗿𝗲𝘄 𝗳𝗮𝘀𝘁𝗲𝗿. With fewer, higher-paying clients, I had the time and energy to focus on delivering an exceptional experience; and scaling my business. So how do you start charging what you’re worth? Focus on value. Stop selling deliverables. Sell outcomes. Position yourself as an expert. Experts don’t compete on price; they compete on transformation. Own your pricing. If YOU don’t believe in your rates, your prospects won’t either. Here’s the kicker: Your dream clients are out there, and they’re ready to pay. But they’ll only find you if you stop hiding behind a low price tag and start showing them the VALUE you bring. If this hit home for you, drop a 💬 in the comments: What’s holding you back from charging more? Let’s fix it. Your pricing should reflect your impact. Not your fear. 👊

A health tech client came to me with a pricing problem. They were charging $50K annually per hospital but revenue was stuck at $2M with 40 customers. 18 months later, they hit $7.2M ARR with the same customer base. The secret wasn't just changing the pricing model - it was proving undeniable value first. We implemented five low-cost, high-impact changes that transformed how customers experienced the product: 1. Comprehensive staff training programs (clinical + administrative teams) 2. We assigned dedicated success managers for white-glove onboarding and ongoing optimization. 3. Monthly benchmark reports showed each hospital exactly how they compared to peers. 4. Quarterly business reviews brought C-suite recommendations directly to decision makers. 5. And 24/7 support with sub-2-hour response times made them feel truly supported. Once customers were seeing measurable results and feeling the premium experience, we aligned our pricing to the value we were creating. Then We Restructured Pricing: 🚨 Old Model: Fixed $50K fee (seen as cost center) 📈 New Model: Outcome-based tiers 1. Foundation: $30K base + 15% of documented savings 2. Growth: $40K base + 20% of savings + performance bonuses 3. Partnership: $50K base + 25% of savings + revenue share The psychology shift was everything: customers stopped asking "What does this cost?" and started asking "How much are we making together?" The results: ✅ Average contract value: $50K → $180K ✅Customer lifetime value increased 340% ✅ Churn dropped to 3% (customers making money don't leave) The lesson? Don't lead with price - lead with proof. When customers can see and measure the value you're creating, they'll gladly pay for more of it. Ready to turn your pricing from a necessary evil into a competitive advantage? Let's talk.

The era of high guaranteed Partner salaries and time-and-materials billing is fading fast in Professional Services. The idea of paying $1M+ salaries to Partners delivering modest revenue is becoming harder and harder to defend. Senior leaders exiting the large firms are finding themselves in unfamiliar territory. The market now demands that they take on real client risk, link their compensation to outcomes—not effort—and focus on building long-term enterprise value rather than stacking billable hours. The firms that are thriving today have already made the shift. Their Partners don’t just turn up—they commit. They build. They invest. And they share in the upside. Lower base salaries, higher variable comp tied to performance, and above all, equity ownership as the central source of wealth creation. Clients expect the same. They’re done paying for time—they want results. Outcome-based pricing isn’t a trend—it’s the new standard. And it’s reshaping the entire industry. We’re seeing the rise of a new breed of Partner: entrepreneurial, hands-on, and now empowered by Agentic AI to deliver more value, faster and leaner than ever before. What’s fading? The traditional leverage model built on layers of junior staff and local hiring. That approach is rapidly losing relevance. What’s emerging is sharper, more scalable, and fundamentally aligned with client success. The future belongs to those who create value—not just those who track time.

𝗧𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆 𝗮𝘀 𝗣𝗿𝗼𝗳𝗶𝘁 𝗖𝗲𝗻𝘁𝗲𝗿: 𝗧𝗵𝗲 𝗡𝗲𝘄 𝗠𝗮𝘁𝗵 𝗼𝗳 𝗗𝗶𝗴𝗶𝘁𝗮𝗹 𝗩𝗮𝗹𝘂𝗲 𝗖𝗿𝗲𝗮𝘁𝗶𝗼𝗻 Most board conversations about technology still frame it as a cost center. This legacy perspective is increasingly dangerous in a market where technology-driven revenue streams now represent the primary growth engine for market leaders. After leading digital value creation initiatives across multiple enterprises, I've observed a fundamental shift in how successful organizations measure technology's contribution to enterprise value. 𝗧𝗵𝗲 𝗧𝗿𝗮𝗱𝗶𝘁𝗶𝗼𝗻𝗮𝗹 𝗘𝗾𝘂𝗮𝘁𝗶𝗼𝗻: 𝗧𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆 𝗮𝘀 𝗖𝗼𝘀𝘁 For decades, execs evaluated technology through the lens of: • Cost reduction (improve efficiency) • Risk mitigation (maintain stability) • Capital expense management (minimize spend) This framework produced predictable outcomes: technology budgets constrained to 2-5% of revenue, innovation limited to incremental improvements, and strategic discussions focused on cost containment rather than value creation. 𝗧𝗵𝗲 𝗡𝗲𝘄 𝗘𝗾𝘂𝗮𝘁𝗶𝗼𝗻: 𝗧𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆 𝗮𝘀 𝗩𝗮𝗹𝘂𝗲 𝗠𝘂𝗹𝘁𝗶𝗽𝗹𝗶𝗲𝗿 (business accelerator) Market-leading organizations now evaluate technology through a fundamentally different formula: 1. Revenue multiplication (over cost reduction) 2. Margin expansion (over operational efficiency) 3. Valuation multiple enhancement (over capital management) This framework produces dramatically different outcomes. When we implemented this model at one healthcare organization, technology investments shifted from 4% to 8% of revenue—while increasing EBITDA by 14%. 𝗤𝘂𝗮𝗻𝘁𝗶𝗳𝘆𝗶𝗻𝗴 𝗧𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆'𝘀 𝗣&𝗟 𝗜𝗺𝗽𝗮𝗰𝘁 The organizations achieving exponential returns apply three specific calculations: 1. Revenue per digital channel: One financial services firm discovered their digital-first customers generated 2.8x higher lifetime value than traditional channels. This insight transformed their technology roadmap from cost management to revenue acceleration. 2. Margin by technology enablement tier: A manufacturing company segmented product lines by technology enablement level, revealing a direct correlation between digital capabilities and margin expansion—from 12% to 38% across tiers. 3. Valuation premium from technical architecture: Companies with modular, API-first architectures command 2-3x higher valuation multiples than legacy competitors—a metric now explicitly tracked in board-level technology reporting. Organizations that measure technology as a profit center outperform those that measure it as a cost center by 340% over a five-year horizon. This is not mere thought leadership! I've implemented this framework across multiple organizations, transforming technology's position from cost burden to value driver. 𝘋𝘪𝘴𝘤𝘭𝘢𝘪𝘮𝘦𝘳: 𝘝𝘪𝘦𝘸𝘴 𝘦𝘹𝘱𝘳𝘦𝘴𝘴𝘦𝘥 𝘢𝘳𝘦 𝘮𝘺 𝘰𝘸𝘯 𝘢𝘯𝘥 𝘥𝘰𝘯'𝘵 𝘳𝘦𝘱𝘳𝘦𝘴𝘦𝘯𝘵 𝘵𝘩𝘰𝘴𝘦 𝘰𝘧 𝘮𝘺 𝘤𝘶𝘳𝘳𝘦𝘯𝘵 𝘰𝘳 𝘱𝘢𝘴𝘵 𝘦𝘮𝘱𝘭𝘰𝘺𝘦𝘳𝘴.

It's probably time to productize your services. Over the last decade I’ve gone from cautioning against the trend toward the productization of services, to neutral on it, to my current position that most of you better hurry up and get there quickly. The need for productization today is driven by the reduction in time and labor allowed by AI. “Thinking” should never be sold by the hour, and “doing” is increasingly accomplished by robots, thereby destroying labor-based pricing models. (Good riddance.) My earlier concern with productization was driven by two things. First, productization (what I called “standardized delivery” in my book The Four Conversations: A New Model for Selling Expertise) tends to go hand-in-hand with standardized pricing, which means pricing the product instead of pricing the client. This removes the ability to leverage "willingness to pay" which differs from client to client primarily based on the value to be created. The most lucrative business models for professional firms appear to be a combination of standardized delivery (productized services) and customized pricing (price the client). So as you move to discreetly packaged services it’s generally wise to reserve the right to charge different prices based on the value being created. There are different ways to do this, that I won't cover here. My second concern with productized services has always been what it does to the salesperson: it makes them lazy. I see this everywhere, including in myself. With only so many products to sell, the salesperson listens only long enough to match the client's need to their product. Then it becomes all about them and their product. The solution to this laziness is Value Conversation mastery. The Value Conversation—the third conversation in The Four Conversations model—keeps everyone's focus where it should be: on the client, what they want, the value that might be created for them. The Value Conversation is where you set pricing guidance (not actual prices but guidance). You want to anchor that pricing guidance in value creation, not in the cost of your solutions. You want to do this REGARDLESS OF HOW YOU ACTUALLY CHARGE. I think building the Value Conversation into your sales model is more important than your actual pricing model. When you productize you will be tempted to skip or truncate the Value Conversation. Do so at your peril. With these two caveats in mind, it's probably time to productize. 

SaaS pricing is shifting from selling seats to selling outcomes. I've been talking about this since March, and the noise is only getting louder. Last month, Sarah Tavel from Benchmark pointed out in her post “Sell Work, Not Software”, that we’re moving from selling software to selling work. This creates blue ocean opportunities by focusing on real value and outcomes, not arbitrary metrics like headcount. Jamin Ball from Altimeter said the same thing in his post, “Is Seat-based Pricing Dead?”. It's about reflecting the value we deliver, not just the number of seats sold. If our solution works as intended, you should achieve your goals without needing to hire more people, right? So, why is this happening now? Two reasons: Post-ZIRP Era: Layoffs are becoming the norm. Fewer seats are sold, and the ecosystem feeds on itself. SaaS companies, early adopters of tech, are feeling the pinch as there are fewer people to sell to, leading to reduced revenue. AI: Companies are leveraging AI to become more efficient, reducing the need for additional headcount. Instead of hiring more, they're implementing AI to optimize operations. The old way of pricing fails to align value with cost. Each seat no longer correlates to the value a company derives. Many companies end up cannibalizing their business model as AI promises to do more with fewer resources. As we rethink our pricing models to reflect the value we deliver, the focus should be on outcomes and results, not just the number of seats we fill.

Shift your customer’s focus from “How much does it cost”, to “What does it represents” (PART 1) Whether you are in online business or offline, a personal brand or company brand, selling a product or selling a service, If you are able to shift your audiences’ and customer’s focus on the value and make the price a much secondary thing to consider, then congrats, nothing can stop you from a strong brand image and instant conversions. So, how do you shift that mindset? ✅ Never play the price game Don’t brand as someone who is cheapest in the market. You can never win that price game with the competitors and ultimately shrink your overall value. People resonate with brands that stand for something bigger than just the service they provide. Instead of focusing on what you do, focus on why you do it. Share stories that highlight your mission, your personal journey, and the impact your work has had on your clients or customers. When your audience connects emotionally with your purpose, they’ll be willing to invest because they see the value beyond the service. ✅ Rightful positioning through content When you consistently provide insights through your content, you position yourself as a trusted expert. Use LinkedIn to share niche specific value-added posts, that address key challenges your audience faces. Your goal should be to educate and inspire, not just sell. The more value you give, ➡️ the more people see you as an authority ➡️ and the more they’re willing to invest in you without focusing solely on cost. ✅ Premium LinkedIn profile I don’t mean premium by the badge but invest time in crafting a compelling profile that showcases your journey, values, and unique approach. Include detailed recommendations from clients that speak to the transformational results they’ve experienced. This creates a high perceived value. When potential clients view your profile, they won’t just see a coach or service provider—they’ll see someone who offers a unique experience, which makes cost less of a concern. Regardless of the industry you are from, by reframing the conversation to be about value and transformation, you invite your audience to see your product or services as something more profound than a mere purchase. So, are you ready to elevate the value of your brand? You aren’t alone, let’s do that together! 📩DM for premium LinkedIn branding services! P. S- A question for marketers, do you think rightful marketing and branding experience can increase the perceived value of the product/service? #aashified #marketing #branding #marketingpsychology #linkedin