Why Pricing Strategy Matters
Most consumer brands don’t fail because of bad products. They fail because they price themselves into a corner from Day 1.
Back in 2012, I made a huge pivot from direct-to-consumer (DTC) to B2B. I quickly discovered how retailers operate. They charge allowances—fees for marketing, shipping, returns, and more. If I hadn’t accounted for these, my brand would have collapsed before scaling.
On average, retailer allowances eat up 15–20% of revenue. That’s margin you can’t afford to lose if you don’t plan for it early.
Fast forward to today, and the same principle holds: get pricing right from launch—or you’ll never “scale into profitability.”
My Background: 20 Years, 1,000+ Product Launches
As the founder of NewAir, I spent two decades scaling a consumer product company, launching more than 1,000 products, and eventually selling the business. Along the way, I learned exactly what works—and what destroys margins.
This playbook is designed to help founders, operators, and brand builders launch with pricing power and profitability baked in.
The Consumer Product Pricing Playbook
1. Product Conception – The Foundation of Pricing Power
Your margin is determined long before you set a price tag.
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Define customer value and pain points.
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Build differentiation through IP, features, or branding.
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Avoid chasing short-term fads—build products with long-term relevance.
2. Analyze Willingness to Pay
Before committing, test what the market will bear.
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Research competitors and analyze category price ranges.
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Run surveys and A/B tests to measure customer response.
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Factor in costs like retailer margins, marketing, and logistics upfront.
3. Develop a Premium Product & Brand Positioning
People pay for perception, not just features.
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Invest in branding, packaging, and messaging that justify higher pricing.
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Use authority and social proof (reviews, influencers, partnerships).
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Launch at the higher end—easier to adjust down than raise later.
4. Price Based on Value, Not Cost
Cost-plus pricing caps your growth. Price based on outcomes delivered.
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Highlight customer transformation, not just specs.
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Create bundles and premium tiers to boost average order value (AOV).
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Benchmark against premium competitors, not bargain-bin brands.
5. Strategic Launch & Channel Control
Your launch channels set the tone for pricing discipline.
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Start with DTC to retain control.
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Expand to retail and Amazon only with pricing floors in place.
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Avoid heavy discounting early—it weakens your positioning.
6. Test & Optimize Pricing Regularly
Pricing isn’t static—it’s an ongoing optimization process.
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Launch high, then adjust downward if needed.
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Track conversion rates, sales velocity, and customer feedback.
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Test psychological thresholds (e.g., $199 vs. $179).
7. Avoid the Race to the Bottom
If your only lever is cutting price, the problem is positioning.
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Defend margins with exclusivity, branding, and differentiation.
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Build brand equity that justifies premium pricing.
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Increase prices gradually as demand and credibility grow.
Build Pricing Power from Day One
Most consumer brands never recover from weak launch pricing. If you don’t bake in strong margins upfront, you’ll spend years chasing profitability that never materializes.
Price smart. Protect margins. Control your brand from Day 1.
👉 What pricing mistakes have you seen in consumer brands? Drop your thoughts in the comments—I’d love to hear them.
