In terms of market segmentation alignment, different customers receive different benefits (perceived or real) from the same or similar product. This drives variation in willingness to pay. One goal in improving a price structure is to improve the match between the willingness to pay and the price extracted. It is a form of price segmentation.

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Value-based pricing talks about pricing based on whether a product provides more or less perceived value with respect to the next best alternative. In the case of professional services however there is a slight difference — since there is the “human touch” involved we can’t be sure whether the next best alternative is a true alternative at all.

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