Value-based pricing

One of the methods of setting the prices in which the companies set prices of their products and services on the basis of buyers' perceptions of value rather than on the seller's cost. Also called perceived value pricing. Basic logic here is that companies should deliver the value promised by their value preposition, and the consumer must perceive this value. They use the other marketing mix elements, such as advertising and sales force, to communicate and enhance perceived value in buyers’ minds.