Expensive or Cheap Is a Relative Decision Your Customer Makes
It is a relative decision. That sits at the heart of it. What one person considers expensive, another person treats as a bargain. So for all my founders, my startups, and the creative businesses reading this, I want to carry the thinking from a recent live session a step further. That session covered educational language programs moving online and the key factors that set them up for success. Pricing sat near the top of that list, because pricing is where most people trip.
Behavioural research backs this up. People form judgments against reference points rather than against fixed absolute values, which is why the same number reads as cheap to one buyer and steep to the next.[1]
Why Fear of Being Expensive Hurts Founders
One thing you want to avoid, especially with online products and subscription based products, is positioning yourself in a way that signals you are afraid to be expensive. The verdict on whether something is expensive or cheap belongs to the customer, and it shifts with the situation they sit in, what they want, and what they want to avoid.
Your role as a founder runs on a different track. You look at the features you want to offer and you ask whether those features, in an absolute sense, sit at an expensive price or a cheap one. Then you find your audience with a message that stays consistent and frequent enough for people to hear it. That is the work.
Pricing Reflects Expenses, Expertise, and AI Resources
Your product carries features, and those features carry expenses. Your expertise and your inside knowledge of the market lead you to offer better products. When you bring AI resources such as Claude Cowork or chatGPT into your workflow automation, you reach decisions faster and sharper, and your pricing will not hold the same number forever. You build more expertise into the product, so the price reflects it.
Some keep the number steady, and that is a fair choice. Most will tell their audience that prices rise in a couple of months, explain the reasons behind it, and give a clear heads up. They also point people toward cheaper products with fewer features, because the expenses behind those offers do not classify them as expensive. When the customer faces that relative decision, some go for the cheaper option, and others say they have been enjoying the features and want the higher tier. That choice sits with them, not with you. Pricing read as a clear expression of the value delivered is the position that holds over time.[2]
Loyalty Is Built on the Transaction and the Trust
A lot of founders hesitate here. They built a relationship and they do not want to lose customers. The relationship rests on the transaction that takes place and the trust that grew around it. Customers stay loyal when they receive features they find nowhere else. That is why standing in a market with a consistent, frequent message matters so much for any creative agency, for content creators, and for every social media management offer.
You will always meet people who hop from one place to the next. One has a sale, so they move. One has a deal, so they move. We have all done it. The task in front of you is to make that movement less of a fight over a single number, because small, confident pricing changes carry outsized weight on the health of a business.[3]
How AI Lets You Zone In on Your Niche
This is the part many people miss. AI now lets you zone in on the niche. You tailor the service and sell to the people who fit it. Competition will be there, because tastes and flavours differ and people change their minds. With AI woven into your social media management tool and your content creation process, you spend less energy fighting over whether you read as expensive or cheap, and more energy serving the audience that wants what you offer. Artists, art galleries, influencers, and content creators each respond to a different set of features, and the sharper your targeting, the cleaner the match. The same logic guides anyone outsourcing social media or building social media creation at scale.
Deconstructing Expensive and Cheap
A moment of honesty. The idea of expensive and cheap is something I had to deconstruct. Family, co-workers, life, and the loose way we all talk about it shaped my view. Standing in the field where I offer my expertise, my knowledge, and the lessons from my own mistakes, I reached a settled conclusion. Expensive, for me as a buyer, stays relative and depends on where I stand. Expensive, for me as a seller, is absolute. The price reflects the expenses behind the features, the expertise, and the information that supports the person buying it and makes their work easier.
That deconstruction waits for you too, especially when you want to raise prices because your expenditure on AI resources or media assets grew, and you sit with a clientele you are afraid to lose. The ones who leave were there with pricing as a main factor in their reason to stay. You will not change that. Offer a cheaper product with fewer features, or show them the benefit of staying. When someone still chooses to leave, let them leave. These are grown people, and they reach their own decision anyway.
Cheaper Is Not Lesser
You might wonder about the people offering cheaper products. Are they bad? Are they good? Notice that I never placed them in either box. It is a contrast, and the verdict on good or bad sits with you. Going cheaper does not make a business lesser than one that prices high. Those founders chose a route toward an audience that appreciates a different set of features, and they want to operate on a bigger scale. It is a decision. Should they step into expensive products and services, they meet the same relative judgment. It skips nobody.
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Sources
1. Daniel Kahneman, Thinking, Fast and Slow, 2011. Kahneman sets out reference dependence, showing that people judge gains, losses, and prices against a comparison point rather than an absolute scale, which supports the central claim that expensive and cheap form in the customer’s mind. https://us.macmillan.com/books/9780374533557/thinkingfastandslow
2. Hermann Simon, Confessions of the Pricing Man, 2015. Simon argues that price is the clearest expression of the value a product delivers and that sellers who price from value rather than fear hold stronger positions, which supports treating pricing as an absolute reflection of features and expertise. https://link.springer.com/book/10.1007/978-3-319-20400-0
3. Michael Marn and Robert Rosiello, Managing Price, Gaining Profit, Harvard Business Review, 1992. Their analysis shows that disciplined, modest price adjustments produce a larger effect on profit than volume or cost moves, which supports raising prices with confidence as expenses and expertise grow. https://hbr.org/1992/09/managing-price-gaining-profit
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