In this episode of Pricing Heroes, we speak with Andreas Stauber, Founder and Managing Director of Resilient Value, a pricing consultancy focused on value-based pricing strategy and implementation. Andreas shares how his background at the intersection of business and IT shaped his approach to pricing, and explains why effective pricing depends not only on strategy and systems, but also on governance, data quality, change management, and execution discipline.
Aaron: Hello, and welcome to Pricing Heroes, a podcast sponsored by Competera. This is a series of interviews with the best-in-class retail pricing experts driving bottom-line metrics for major retail brands and the industry as a whole.
Today’s guest is Andreas Stauber. Andreas is the founder and managing director of Resilient Value, a pricing consultancy specializing in value-based pricing strategy and implementation.
He brings more than fifteen years of experience across pricing, category management, and commercial strategy. Over the course of his career, Andreas has built and led centralized pricing functions, developed pricing strategies across B2C, B2B, and omnichannel environments, and implemented data-driven pricing frameworks at scale.
His work spans everything from designing pricing architecture and competitive intelligence systems to establishing pricing as a strategic function within organizations and embedding it into day-to-day operations. Today, Andreas advises mid-size companies and global enterprises on pricing strategy, process transformation, and AI-driven pricing optimization, with a strong focus on execution and measurable business impact.
Andreas, welcome to Pricing Heroes.
Andreas: Thanks, Aaron. Thanks for having me here, and I’m really happy to be here.
Aaron: So, Andreas, would you mind telling us a little bit about yourself and how you found your way into pricing?
Andreas: Oh, that’s a tricky one because my background is actually a little bit different than pricing. I started more in the business informatics or information systems area. From the very beginning, my professional home has been the interface between business and IT.
That’s the space I’ve always cared about, translating between those two worlds, making sure technology actually serves the business and that business requirements are grounded in what technology can realistically deliver.
For many years, I applied that in fast-paced retail environments, rolling out ERP systems, master data systems, and supply chain systems across multiple countries. Essentially, everything that you need to open and run an omnichannel retailer, always in that gap where business meets IT, so that gap that nobody wants to tackle.
My first real encounter with pricing was, let’s say, an accident. It was not really voluntary. My former company had bought a pricing system. They had bought a pricing system, but they had not yet thought about what to do with the pricing system. There was no strategy. The solution was like many companies have in this area: “Just buy a pricing system and everything will be good.”
So I got thrown into that topic as a project manager with the task to find out: do we kill it or do we rescue it? That’s where my first tackle with pricing was. To give you a little bit in advance, we decided to rescue it, and that’s where things got interesting.
At first, the topic looked more like a hardware and sizing issue on the surface, but it turned out to be something much bigger. We didn’t just need to fix the system. We needed to build up an organization around it: pricing logic, pricing strategy, governance, the whole operating model.
At first, we started with big consulting agencies supporting us in this area. But pretty quickly, we shifted toward hiring smart pricing people internally and building the capability in-house on an international scale.
From that project manager role, I moved into several director-level pricing roles, setting up pricing organizations, data foundations, strategies, and governance for omnichannel retailers.
A few years ago, I decided to found Resilient Value because, honestly, I just couldn’t get enough of pricing projects. And in hindsight, pricing is actually the perfect field for someone with my background because it sits exactly at the interface between business and IT: commercial logic on one side, and data and systems on the other.
That’s where I always felt at home.
Aaron: So your background is in IT, but you shifted to pricing?
Andreas: No, it’s really the gap between business and IT. So I was studying both business and IT, economics combined with IT, and that’s also where my strong suit always lay: being in this gap nobody wants to tackle.
So either being in the business area speaking to the IT guys, or being in the IT part speaking to the business guys when it comes to ERP systems, master data, pricing systems. These are systems where you need both. You need both areas, but you can also have a big impact. That’s my background mostly.
Aaron: And you shifted to pricing?
Andreas: It was an accident. So it was like, okay, my former company bought a pricing system. It’s like, “Okay, let’s buy a pricing system, then we have a pricing system, and everything will be perfect.”
But just buying a system doesn’t solve the problem. You’re just getting started with: which pricing logics do we need? Which pricing strategies do we have? Where do we get the competition data from? How do we work on our data? Oh, we don’t have good enough data quality. And then you see, oh, we need governance for that. We need people doing all that stuff.
From the small IT project where it started, it became bigger and bigger. It became a huge organization. We were doing this for fifteen countries, and so it became more and more professional.
Also from my perspective, from this IT focus that I had firsthand on pricing, I started to love pricing as a total area because you have so much impact and you see so many different things.
I think that’s a unique part with pricing. You see both sides. You see a direct impact. You can really crunch into data, but you see a direct impact of what you’re doing on everyday business.
Aaron: And how was that learning curve for you moving into pricing?
Andreas: It never stops. Together with some colleagues or friends, we founded the Pricing Club in Hamburg some months ago, and we started to invite people from different pricing areas in retail. Every day, you see something completely new that you never saw before, because pricing in different companies is completely different.
In some companies, it’s just a fundamental pricing capability, sending price lists to the sales department, and they do the negotiation. In other companies, it’s a very statistically driven and number-crunching process in a different area. So with pricing, you never stop learning.
Aaron: What was the most unusual case that you’ve seen so far in pricing, or something that was exceptional or innovative?
Andreas: Every innovation is a really good one. There are, for sure, some innovators that try new pricing approaches, especially in retail. I think we all know these dynamic pricing approaches depending on the device that you’re using, depending on the location that you’re using, the timing.
And I think many of these innovations stopped over the last years. I don’t see too many experiments with customers because the backlash is always quite hard when people find out and you don’t treat them in the right way.
A big innovator in pricing has always been, and still is, I think, Amazon. How they tackle pricing is, I think, one of the most professional examples. In many areas, it is still state of the art.
Aaron: It makes sense when you consider how much data they’re sitting on.
Okay, so you described pricing as one of the strongest profit levers in a business, but one that is consistently underestimated. In your experience, I’m curious, what does that actually look like inside an organization? How is it underestimated, and where do you see value being lost in practice?
Andreas: Yeah, I still think that pricing is one of the strongest profit levers. But as you mentioned, it’s the most underestimated one. I think the reason is structural. In most companies that I see, pricing isn’t owned end to end.
There’s a little bit of pricing in sales, a little bit of pricing in marketing. There’s finance, there’s category management, and each function optimizes for its own KPI.
Even where we have a pricing department, it is maintaining, for example, list prices or base prices. Then comes the sales department. They’re doing rebates, conditions, and fancy stuff with the prices that you were calculating in the beginning.
There are also leaks, like I mentioned. The first one is the list price to pocket price gap. So you set a list price, then you discount it, then it comes with rebates and promotions, and then you add some exceptions. There’s a special product, a special department, a special area, a special customer. These exceptions stack up along the way, and nobody owns the overall effect.
So when you actually measure the pocket price, it’s often several percentage points below where you expected it to be, and also where management expected it to be. It’s always a little bit like, “Surprise, you earn less than you think.”
And the second one is complexity. Like we have these exceptions stacking up, and that’s also stacking up the complexity. It’s a huge topic in its own right.
Pricing complexity rarely comes from a deliberate strategy choice. You start with a very handsome or very straightforward pricing strategy in the beginning, but it grows organically with special prices. A customer asks for this exception, and it gets granted. A product exception. A special department gets an exception.
Depending on the structure and how you’re doing this kind of business, you have these exceptions, and for these exceptions come the next exceptions and an exception to the exception. From this very handsome, nice, neat pricing strategy you had in the beginning, it becomes a monster of a pricing strategy.
And it’s a pricing strategy where most companies don’t really know what is happening anymore. Over time, these special prices stop being exceptions and they start dictating the overall pricing logic. The official pricing strategy still exists on paper, but in reality, the company is managed through a web of different special cases that nobody fully understands anymore.
Untangling this is often where the real work begins: having the guts or the power to say, “Okay, we reduce complexity. Yes, we know that was a special case over the last ten years. We throw it away. We start from scratch, and we start with reduced complexity.”
That’s the hard point because then you have to talk to every department. “Yeah, but we have a special customer.” I think you’ve heard all these stories about why there’s a special case, and it has its reason. Yes. But it gives you a really big headache if you still maintain it.
And I think the last one where value is being lost in practice, and what is important for me, is the capability to execute prices, or the pricing execution capability. This goes far beyond having a pricing department on the org chart.
It starts with governance. Who’s actually accountable? Is it clearly defined? Is it the CEO, the pricing manager, the category lead? Who is allowed to decide what?
And it extends into the operational reality. Who is authorized to make pricing decisions? Within which boundaries? Based on which criteria? Is it traceable afterwards?
I see this repeatedly. Things look excellent on paper, with a proper pricing organization, clear frameworks, and a well-defined process. But the moment a pricing decision has to be made that doesn’t fit the standard rules, the whole setup has hit its limit. Decisions stall, get escalated, or get made by whoever happens to be in the room.
And that’s where the value quietly disappears. I think those are the main issues I see in pricing where the strong lever of pricing is still underestimated.
Aaron: So as someone who has had quite extensive experience building pricing strategies with enterprises, how are you building a strategy that accounts for and mitigates the risks of complexity and exceptions in pricing?
Andreas: First, you need to understand the company itself. What’s their main goal? What’s the target? And then, what is the overall strategy of the company?
The easiest part is something like a written-down company strategy. Sometimes it’s quite outdated, but it’s a great hint about the company. Besides the strategy, you need to understand the values of a company. Each company has a strong value, or what it is set up for. There’s a dedicated vision in this company, a value in how they treat their customers and how they treat their products.
Your pricing strategy needs to reflect that value. Besides all the prices that you do, this value or the strategy of the company still needs to be resilient. That’s also a hint as to why I named my company Resilient Value, because the main character of the company needs to stay the same.
For example, if you have a discounter, you can’t say, “Okay, I’ll make a new pricing strategy and we’re now selling luxury brands,” because it doesn’t fit the vision with the customers. So the values of the company need to stay in place.
Once you tackle these strategies at a very strategic level, you need to fully understand how this is happening in the different areas, in the different companies, and in the different departments, and how they’re reflecting these parts.
Once you understand the company, you can get started with setting the pricing strategy. And with the pricing strategy, what I like to do is start easy. Forget all the exceptions in the beginning. Start easy. Start with the nucleus, the core of the pricing strategy. What is this company? What does it stand for? What is it reflecting?
Make an early, easy assumption. Perhaps start with cost-plus pricing in the beginning. Say, “Okay, we do our prices based on cost plus thirty percent in the easiest way.” Now let’s get started on exceptions. Which of our products wouldn’t fit in this easy scenario?
From this easy scenario, you start building your pricing strategy in an organic approach. And then comes reality. You approve this with different departments, and then you start from scratch again. So you need different iterations so that you can convince everybody that it’s the right approach.
But I think convincing everybody and starting this change process is very essential, because otherwise a small department that might be relevant for setting the prices, if they don’t agree with what you’re doing, they might hinder you or throw some stones in your way, and your nice, fancy pricing strategy will never come to life.
Aaron: Of course, you have to get buy-in. You have to have those people who are willing to sponsor and adopt it. Otherwise, it’s for nothing.
So let’s say that you have the governance structure in place. You understand the business’s values. You’ve developed the strategy. Where do pricing initiatives tend to break down once they move beyond this design phase?
Andreas: Like we just mentioned, that’s the easy part. You mostly do it still on a PowerPoint basis, or you do nice slide decks. You do some strategy decks, pricing frameworks, target architecture. They haven’t met reality. You haven’t met the full horror of what you really see in the business.
Perhaps ownership is one area where they break. Either it’s a vacuum, and nobody has ownership, or everybody has ownership at the moment. So you need to get started with touching sales, finance, product, IT, operations.
And if there’s no clear owner with a mandate and accountability, every decision becomes a negotiation. The initiative slows down, compromises pile up, and the original logic gets diluted.
The second is the data reality. You get started with a pricing initiative, and they say, “Okay, we have perfect data.” Like many companies think they are perfect. We know our products. But that’s not reality. Master data quality, product data quality, and data quality overall are mostly quite poor.
Most pricing designs assume clean, consistent, timely data. But the reality is fragmented master data, inconsistent customer hierarchies, missing cost information, or information not being shared because it’s so secret that just the founder or just the CEO is allowed to see it. And transaction data is not shared across systems.
You can’t run value-based pricing on data that you can’t trust.
But for me, I think the most important point is change management, which is completely underestimated. The reality is, when you’re founding a company, you start selling a product, and somebody is doing pricing. It’s the CEO, it’s the founder, it’s sales, it’s the purchaser. There’s somebody doing pricing.
But most companies don’t start with a pricing department. So you’re starting with a pricing department or a pricing expertise area, and you try to push it into a company that is already running.
Nobody is saying, “Hey, great that you’re here and taking away our jobs.” Sometimes they do the complete opposite. “It’s great that you take away our jobs because we don’t want to do it.” But it’s not like the process is already streamlined around the pricing area.
So you have to push into this area and find a way to get started. You’re not filling an empty space. You’re pushing into a niche that’s already occupied. And you’re also taking authority, which many of the colleagues who have already been there for a longer time sometimes don’t like. You take over authority, decision rights, and often identity from people.
You take identity away from people and departments who have owned these topics sometimes for decades. They rarely see the new pricing team as a welcome addition. That’s exactly why you need clean change management and why it’s so critical.
It’s not enough that you have a new pricing organization and you publish a new process. You have to really carve out the space for pricing in the overall reality of the business. That sometimes means clarifying where pricing decisions now sit and where they don’t. Sometimes you have to really fight hard, fight the politics in this area.
It also means engaging with all the people who are doing this. This is a change effort where you also need to include the C-level in the discussions and get the mandate for doing that.
So when people ask what they should do, I always say: budget as much attention for the change management itself as for the pricing logic itself. It’s as important as the pricing logic, and don’t underestimate it. Maybe even more, depending on the politics in the company.
Aaron: It does seem to be the case that in any circumstance where there is transformation within an organization, change management is the most challenging aspect to get right. Because you can invest tons of money into building or buying the right solutions, trying to implement the proper architecture, and developing the workflows and processes. But at the end of the day, if the people who are operating within this organization are not adopting the practices that you put in place, then it doesn’t matter.
Andreas: It’s because people tend to find a way around policies. I saw companies where you built up a very sophisticated pricing process, everything was in line, but the real pricing decisions were done somewhere in a hidden Excel sheet that just two people knew about.
And you do these calculations in the pricing system, and you’re thinking, “Why is it not happening? What’s wrong? Why isn’t the margin like I expected?”
It’s like, “Yeah, but there’s a price in our Excel sheet, not in your pricing system.”
Oh, great.
Aaron: Exactly. It’s just the fundamentals of user experience, right? You have the concept of the desire path, where people decide not to walk on sidewalks, and they’ll create through erosion their own dirt path between two points. It’s because, ultimately, people are going to find what is easiest for them and pursue that, and it applies in projects around pricing as well.
It sounds like you are a strong advocate for centralized pricing organizations within companies. Besides the fact that change management is the most challenging aspect of this, and then also data preparedness, when companies are approaching developing a centralized pricing organization, how do they build it from the ground up?
Where do they start? Day one to day thirty to day ninety. How are they planning for this implementation in a very practical way? Because it’s easy to say, “Oh, you need to do all this stuff. Make sure the governance is in place. Have a strategy.”
But for the organization that is a little overwhelmed at the prospect of developing a full pricing organization that is centralized, where can they start?
Andreas: I think the tricky part is that there’s no one size fits all. Every company is different. There’s not one blueprint where you can say, “Okay, that will lead you to success.” That’s not how it works.
I can just tell you how I would tackle the topic. When I start setting up new pricing organizations, I don’t start with an org chart. I try to start with reality on the ground, to find my way within the company. Sometimes that’s just talking to people, running around, not like a headless chicken, but running around through a company and talking to the people. Not at the C-level, not C-minus-one, but really the people who are in the day-to-day business.
Let them talk about their feelings, what they experience, and how their interactions with customers are. So the first step is always a proper diagnosis. Not what the paper is telling you, but really being hands-on with the people. How is the process being set today? Not how the process documents say it is set, but how it really happens in day-to-day business.
Who makes the decisions? That’s always a tricky one. Sometimes paper tells you something completely different from what you see in reality. What data is used? Where are the gaps, the workarounds, the pain points? Where is value being lost?
I think you can’t decide a target state without understanding the starting point. This always takes longer than people expect because it’s informal. The reality is rarely documented. So you need to identify the right people and talk to them. Sometimes you go to talk to somebody, and you find three new people you need to talk to.
I think it’s crucial when building up this organization or starting from scratch to find the right people and talk to them.
Once I have a clear picture of where the company stands, the next priority for me is top management. To see the completely different view. What are their goals? What are their aims?
What I usually do is push for a dedicated pricing board or steering committee at the beginning of a project, once I have the first picture. That’s to align with them on target pictures and to get them on board, sometimes just to reduce politics, so that everybody is on board. Because if they have the chance to work with you, then afterwards you don’t have to discuss so long about what you really do during that.
Also include decision-makers from sales, finance, product, and everybody who is really important for that. The goal is not another committee just for the sake of having another committee. The goal is to visibly connect pricing to the top of the organization, and also because it is tackling mostly every C-level area.
When you don’t have them on board, the initiative won’t carry through the first real conflict.
With that foundation in place, I move quickly into execution. Once I have the lower levels and the top levels, I try to find the first real execution of pricing. I’m a strong believer in building up a prototype instead of spending months on a slide deck, the next slide deck, the next slide deck, the next slide deck, version number thirty-seven of a slide deck, and aligning strategies.
Take one of the points. Have a clear vision where you want to go, but take one of these, pick a concrete use case, ideally one where the pain is visible and the potential is measurable, and deliver a tangible result within weeks, not quarters.
Sometimes you just do this the dirty way. You just do it in an Excel spreadsheet with a new logic. You get started, or you build an MVP, you build a prototype. Perhaps they already have a pricing system, and you try to deliver a very fast result so they can see the results of pricing, and you have the first experience and also the first acceptance.
Once that acceptance is there, you can scale. And once it gets scaled, that’s when I start really building up the pricing structure, the pricing organization, or the team structure, with clear responsibility across the company and also clear roles within pricing itself.
I think because pricing is such a diverse area, you really need diverse people in there. It’s not sufficient if you have just people with a strong controlling background or just IT guys. I think you need somebody who is helping with the systems. You need somebody with a strong IT background. You need people who have a great focus on data analysis, people who really like that kind of job: number crunching, investing time.
I think that might become better in the future with strong AI capabilities, but having somebody doing the number crunching for you is essential. Then you need analysts who are also creative enough to build pricing strategies and who translate these insights into pricing logic and commercial frameworks.
You need some people doing the real pricing, the price setting, the operators doing the price execution. And very essentially, you need somebody who is able to talk to people. Somebody who’s a great connector, somebody who can transport this idea of the pricing department or the pricing area into the whole world of the company.
Somebody who’s great in politics, somebody who is great with people, talking to people, and just a nice guy who really helps you set the foundations for a pricing structure.
And I think that’s it. Sounds easy.
Aaron: It sounds very much like what you hear from a lot of the tech startups building products: understanding the end user, the challenges that they’re facing, the way that they operate day to day, identifying where the opportunities are for your product, and then building from there. Starting with a small pilot, iterating, focusing on the main features, and not trying to scale too quickly or address all use cases simultaneously.
Andreas: Yeah, exactly.
Aaron: It seems to work for some of the best, most successful tech companies out there. It probably works very well with building pricing organizations within a company.
Andreas: Exactly. Reduce complexity. I think that’s one of the key points.
Aaron: One hundred percent.
So I would like to shift focus a little bit to pricing strategy now. Value-based pricing is a major focus in your work. Many companies talk about it, but few truly implement it. What does it actually look like to implement value-based pricing?
Andreas: That’s a very, very tricky one because, as you said, many really try to implement value-based pricing. Everyone talks about value-based pricing, and as I said, almost nobody really does it.
I think the reason is that you don’t just scale value-based pricing by using a PowerPoint.
In practice, value-based pricing, for me, means three things. You need to understand what value actually means for a specific customer and also for the company itself. Not in general terms, but how you can quantify it in economic terms.
What does your product let the customer do better, cheaper, or with less risk? And I’m not talking about product features. For example, if you talk about a TV, you have a forty-two-inch TV or a forty-five-inch TV. What’s the value behind that? It’s not that it’s three inches bigger. It has a bigger picture. It has a better experience.
So you’re starting to translate technical features into customer experience.
In B2B, I think this is easier because you sometimes have direct contact. On the other hand, he can tell you what his pain points are, and you can really try to understand where the benefit for your partners lies.
In B2C, it’s trickier because you have so many different customers, and what might be an experience for customer A might not be a real experience for customer B. You need to find a way to get insights into your customers. You need customers. You need to find a way to get the experience of what they are valuing.
Sometimes you have good salespeople you can just talk to on the sales floor in a brick-and-mortar store, and perhaps they understand it. Sometimes you need to find a way to directly talk to your customers to get the experience.
Once you have this feedback, you need to translate that value into pricing logic. That usually starts with segmentation. Different customers get different value from the same product, and your pricing architecture needs to reflect that. Sometimes through tiered offerings, sometimes through differentiated discount logic, sometimes through outcome-based models, depending on the business area you’re dealing with.
Once you have that, then comes the point where most implementations fail. You need to equip your salespeople to actually sell the value. If the value is not tangible, and they need to spend fifteen minutes just trying to explain the value and why it’s better for our customers, people stop listening to you after thirty seconds.
If you have to explain the value like an elevator pitch, then it’s something that they can also take into account in your value-based pricing. If you can’t do this, it’s not a value that they should take into account for pricing logic.
And that’s also where the fighting within the company starts. It’s also coming back to your question before: reduce complexity. Don’t start with these big value trees in the beginning and identify five hundred different values within your companies.
Start easy. Try to differentiate in the segments. Start with one value description, most likely. And from there, build your value-based logic.
You need to be aware that implementing value-based pricing is not a project. Once you get started with it, you never end. It’s more like a commercial transformation, which starts perhaps in pricing. It starts already in production or also in the purchasing department. It goes over to the pricing department and needs to be translated over to the salespeople.
So value-based pricing is not just a routine. This is something the whole company has to adapt if you really want to be successful with it.
Aaron: I can’t help but wonder, in the future, will AI help businesses with segmentation and with presenting value tailored specifically to customers?
It’s easy in B2B when you’re selling, especially to enterprises. You can actually have conversations with your customer and understand their pain points, understand their objectives, their transformation goals, and then you can sit down and say, “Okay, well, here are the offerings we have. These are the solutions we’re proposing, and this is the value to you.”
But in B2C, when you’re selling to such a broad base of consumers, it’s more challenging. But I suspect that maybe there will be opportunities to tailor it more specifically to them. It’ll be interesting to see how that goes.
Andreas: Yeah. But I think we have to be very careful with this AI aspect. Like you said, it will help a lot in bringing this stuff forward. But as you can do it with AI so easily, you start building up complexity. You still need to be able to understand what is happening there.
I think that’s a point we should not underestimate for the future.
Aaron: That’s true. That’s very true.
So speaking of AI, I do want to ask you a little bit about AI pricing. You’ve worked across everything from Excel-based setups to AI-driven predictive pricing. How should companies think about that maturity curve and assess their place on that curve? And where do you see AI delivering the most value for organizations today?
Andreas: As you said, at the lower end, you have these Excel-based setups. People start with Excel, and they’re doing their pricing there. Sometimes you also have these people still using their gut, gut-feeling-based pricing. Don’t talk about that one. That’s a different story.
But I think the lower end is these Excel-based setups, often very reactive, often cost-plus, often driven by gut feeling.
One level up, you get a structured pricing process with clear governance, decent data, and consistent logic. I think the next level is analytical pricing: elasticity models, segmentation, and systematic competitive intelligence.
At the top, you have predictive AI-driven pricing, where the system recommends prices at scale and learns from the outcomes.
So in general, we talk about four to five steps from a general maturity perspective. For sure, sometimes you have companies where, for example, with your governance, perhaps you would already tackle level three, but your system setup is still maturity level one, or the other way around. So you need to find a way to really have an honest view of where you’re standing.
The mistake I see most often is that companies try to jump two levels at once. They buy a sophisticated AI pricing tool while the master data is still broken and the governance is unclear. That rarely ends well because then you have a pricing system, but nobody can use it.
And where does AI deliver the most value today? For me, there are three areas that stand out.
First, at scale. Anywhere you have thousands of SKUs, many customers, and many pricing decisions, AI can systematically outperform manual approaches. So in retail, distribution, e-commerce, tested areas.
Second, in pattern recognition that humans can’t do: elasticity models across product relationships, cannibalization effects, promotional response modeling. That’s where AI starts getting really fancy.
And third, in decision support, not full automation. For example, the most successful setups that I’ve seen today are the ones where there is still a human in the loop. I would not go for just a pure AI system where no human is in the loop, but more like an AI recommendation system where humans are still in the decision phase, and the system still needs to learn from the decisions.
That builds trust and keeps accountability clear. AI is not so much a shortcut. It’s a multiplier on a solid foundation.
And very essential is that if you don’t have a solid foundation, if your pricing data from the past is just gut feeling and you have no sophisticated rules in place, implementing an AI-based pricing system just on that rubbish data won’t help you directly from the beginning.
Clean up. Decide what you do. And then AI helps you become faster.
Aaron: I want to circle back very briefly to what you said a little earlier about being careful around dynamic pricing practices and emphasizing the importance of having a human in the loop here. I think this makes a lot of sense.
In fact, this is relevant right now because I’ve been seeing a lot of conversations around AI pricing in the news. Just recently in the States, Maryland was the first state to make it illegal to use AI pricing tools for dynamic pricing. There are conversations around this in New York State as well. I know that it’s been floated in California, and even at the federal level, you have senators like Amy Klobuchar who have spoken about passing regulations.
So we’re seeing a lot of pressure on pricing right now. You have rising input costs from energy and tariffs, prices for customers, and this increased scrutiny around dynamic pricing.
So then the question for organizations that are trying to develop pricing strategies leveraging the latest technologies, but whose business is also trying to make profits, while they also have a consumer base they’re trying to serve, is: how should companies think about pricing in that kind of environment?
Andreas: So you mean this current environment, which is a very pressure-driven environment. I think it’s one of the toughest pricing environments in decades.
You have this cost pressure. You have this legal stuff that you just mentioned. You have tariffs. You have energy issues. You have consumers who are generally price sensitive after two years of inflation, and increasing regulatory and public scrutiny about dynamic pricing.
So a lot of things are happening at the same time. There are a few principles that I would like to emphasize.
First, in this area, it’s essential: don’t confuse cost-driven price increases with pricing strategy. Sometimes you need to increase your prices due to cost at the moment. Passing through costs is necessary, but it’s not a differentiator. The companies that come out of this period strongest are the ones using this pressure that we have now to sharpen their value proposition, not just their list prices.
We need to see prices having a stronger focus on the value level of the products instead of the cost level.
Second, you need to get very surgical. Perhaps you can’t have a blanket over all your prices, but you need to differentiate by segments, channels, and product categories because they have very different elasticities and very different competitive dynamics. There might be decisions that are very good in one segment, but very wrong in another one. You really, really need to dive deeper on that one.
The third for this period of time at the moment is to take transparency seriously. Consumers and regulators are watching at the moment what we’re doing there. Dynamic pricing is legitimate, but it has to be explainable and fair. I think it becomes a reputational risk when customers feel manipulated, like we see at gas stations at the moment.
Build up your pricing logic so you could defend it publicly, because one day you might have to. If you can stand proudly and defend your prices, “That’s the price that we’re offering,” and you don’t have to hide behind it, then you’re in a good way.
But if you have to do something in a dark room and say, “Okay, let’s hope the customer doesn’t find out,” don’t do it at the moment. Not a good strategy at the moment.
Aaron: Yeah, that sounds like a great strategy.
Okay, so the final question: What books, podcasts, or other resources would you recommend to our Pricing Heroes community?
Andreas: I think, for sure, the most relevant source is the Pricing Heroes podcast. No, just kidding.
When you ask me about books, I would start with the fundamentals. Anyone who’s working in pricing should have at least one or two books by Hermann Simon. That’s where you get started. Understanding what he wrote about pricing, what he wrote decades ago, and I think it’s highly relevant today, also just for building up the foundation.
Beyond the fundamentals, it really depends on your context. Like I said in the beginning, there are so many different pricing approaches. You need to understand your peer group, whether you’re in B2C or B2B. Generic pricing advice doesn’t get you so far there.
From a podcast side, besides Pricing Heroes, I would recommend Impact Pricing by Mark Stiving. For me, that’s one of the most valuable ones. I like it very much, and I think he also has a very good comment base on LinkedIn with his news that he’s sending there. Try that one.
And on the other hand, try to get into contact with your peer groups. Find other pricing professionals. Use the Professional Pricing Society or the EPP, the European Pricing Platform. Use pricing tables, use pricing clubs like the one that we have with Pricing Club. Try to find other people who are really into pricing and talk to them. That’s what I would do at the moment.
Aaron: Great. And I really like the Impact Pricing recommendation. Mark’s content is phenomenal. I follow him on LinkedIn. He’s always producing great stuff.
Okay. Well, Andreas, thank you so much for being on the show with us today and sharing your insights.
Andreas: Right. It was great that you had me here and gave me a chance to talk about the topic that I love most.
Aaron: All right. We’ll have to do it again soon.
Andreas: Thank you very much, Aaron.
Aaron: I hope you enjoyed our conversation with Andreas Stauber. Be sure to follow and connect with our guest on LinkedIn.
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Thanks for joining us on this episode of Pricing Heroes. Take care. Until next time.