Friday, January 07, 2005

On the troubles with pricing

I recently had to get a certified copy of my birth certificate.

I was talking with my sister on the phone last night, and found out that she also needed to get a copy of her birth certificate, a couple of weeks back.

She drove an hour away, spent 2 hours waiting, and returned home with proof that she was born when and where she claimed. I spent fifteen minutes downloading a form, filling it out, and faxing it to the same office. Then fifteen minutes driving to the local Fed Ex office to pick my copy up the next night. I paid about $20.00 more. It was worth it.

It had me thinking a little about what we are willing to spend for goods and services, and what we consider value for our money and time.

An excellent post over at Joel on Software also considers those topics, but in the area of pricing software. See Camels and Rubber Duckies for an amusing way to look at how one might price software.

Take my advice, offered about 20 pages back: charge $0.05 for your software. Unless it does bug tracking, in which case the correct price is $30,000,000. Thank you for your time, and I apologize for leaving you even less able to price software than you were when you started reading this.

I'm not sure I agree with his conclusion, which I've quoted above. His essay is a thoughtful exploration of factors that one might consider in setting a price.

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