Value-based pricing anchors pricing to the economic value the product creates for the customer. It requires a deep understanding of customer outcomes and willingness to pay, and typically results in higher prices and margins than cost-plus or competitive pricing.

Example: A billing automation platform saves its customers an average of $50,000 per year in manual finance work. Instead of pricing based on its development cost, it charges $15,000/year, capturing a fraction of the value delivered while remaining highly attractive to customers.