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The Value Equation | Iterative Path

For your customer the net value from using your product is total value created less the price they pay. The total value can come in the form of:

  1. Incremental revenue
  2. Decrease in costs
  3. Relationship value

As long as the total value created is more than what they have to pay for it, i.e., net value created is positive, customers are happy to pay. (Let us set aside Reference Price effect here).

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The Value Equation.