Markets want to be smart and finely adapted to incentives.
The Internet wants to be smart and adaptive.
The Internet enables direct feedback that is immensely rich and timely.
Direct feedback is the most powerful way to tune incentives.
Free is inherently dumb, because it obscures market incentives.
Set prices do not reflect value-as-realized (by individual buyers).
Prices should correspond to value-as-realized.
Buyers, not sellers, perceive value-as-realized.
Sellers should measure and manage buyer perception of value-as-realized.
Maximize buyer perception of value-as-realized and a fair price will follow.
A good pricing process is a conversation.
The way to do pricing is to be a pricing process.
(As originally published ...