Beyond the Value Horizon

“Pricing is actually pretty simple… Customers will not pay literally a penny more than the true value of the product.” – Ron Johnson

Thing is, the quote can be true – but only in a world where everybody understands everything, which is obviously not planet Earth.

An expert’s value is directly proportional to how much more they know about their subject than their client – but up to a point. 

• To a university, another thesis about geothermal energy can be just another point on a scoreboard. 
• To a sci-fi author, that study can be a great boost to imagining and describing a different world. 
• To an entrepreneur, that same study can provide a significant market advantage. 
• To a flat-earth conspiracy theorist, however, actually understanding that study could alter the course of their life forever.

The whole idea of “paying for true value” is deeply problematic – how can someone who knows very little about a complicated subject ever perceive the “true value” they would be getting?

Instead, the truth is: if the difference in knowledge is too great, the client understands so little that they will consider your knowledge worthless – the value is beyond their “value horizon”.

When you can choose, pick an audience that knows at least something about what you do, and save yourself the trouble of having to “blow people’s minds” to get the message through. It’s less fun than it sounds.