Our thoughts on what to price, products, use cases or value paths seem to have struck a nerve. We did a LinkedIn poll on this theme and got more than 300 responses in 24 hours. Pricing of value paths is much more common than we expected.

Pricing is often divided into product pricing or services pricing. This is too simple an approach for companies that provide solutions to complex problems. Use cases and value paths can be a more compelling approach to pricing for companies that do more than sell a simple well defined product.

The Value Path is a powerful metaphor that brings together processes, performance, business outputs, and organizational goals to focus on value creation. The value path is a series of steps that results in value for the customer or end-user.

The power of customer journey mapping is well understood in the service design world. Ibbaka has introduced swimlanes for value and price into the customer journey. It is important to remember that the customer journey is not a given, it is designed. Value mapping is the key tool to design the customer journey experience.

Usage-based pricing is a best practice and a key step towards outcomes-based pricing. This sounds good, but what usage? Should any click be used for the usage metric that becomes part of the pricing model? Value paths are are a sequence of actions that lead to value. They are different from but related to value streams. Identifying value paths and then making them part of your pricing model is the key to usage-based pricing.

Just because you have professional services and software subscriptions and data does NOT mean you are driving a service led growth model. You have service led growth when services predict subscriptions and subscriptions predict revenue. Prediction is key. To really get the crank turning, data is also monetized and the platform is constantly reducing the cost of service delivery while increasing its value.