Book Review: Confessions of a Pricing Man. How Price Affects Everything
Price is the place where value and money meet.
TL;DR?
Pricing isn’t about spreadsheets—it’s about psychology, value, and positioning. Hermann Simon, founder of global consultancy Simon-Kucher & Partners, opened my eyes to the world of pricing strategy with lessons drawn from decades advising firms from industrial giants to family-run shops. Confessions of the Pricing Man is an accessible, story-rich book that shows how price is the strongest profit lever—and the most underused.
“There is nothing that has a higher impact on profits than the right price.”
Hermann Simon, founder of the global consultancy Simon-Kucher & Partners, shares decades of experience in pricing strategy in a narrative that mixes memoir, case studies and theory.
Professor Hermann Simon is the founder and chairman of Strategy & Marketing Consultants. He is a much sought-after speaker at business conferences all over the world. Simon is a world-renowned author and has published over 30 books in 26 languages. A native of Germany, Simon studied economics and business administration at the universities of Bonn and Cologne.
For a topic that is potentially so dry, it's remarkably readable.
This book was first written in 2015, and is in a class like the early Peter Drucker books. The principles are timeless. I think it's a must-read for entrepreneurs who are leaving money on the table by undervaluing their offer.
What Questions Will This Book Help You Answer?
- Am I charging enough for what I offer?
- How do I move from cost-based to value-based pricing?
- Why do customers push back on my price—and how do I respond?
- How can I use price to reflect the real value I create?
- How can I raise prices without losing customers?
- Should I ever discount—and if so, how do I do it without killing my brand?
- What pricing structure works best for different products or audiences?
- How do pricing expectations change across cultures or industries?
What’s the Big Idea?
The central argument of the book is that price is the most effective driver of profit—far more than increasing sales volume or reducing costs—yet it’s often treated as an afterthought. Simon believes that price should reflect the value delivered, not the cost incurred, and he provides a global tour of pricing best (and worst) practices.
He also dismantles the myth that “the market sets the price,” showing instead how companies can shape price perception and train their customers to understand and pay for value.
“Many business people still believe that costs determine prices. This is wrong. It is the value to the customer that determines the price.”
Key Concepts You’ll Learn
1. Value-Based Pricing
Set your price based on what the customer is willing to pay for the outcome, not what it costs you to deliver the product or what your competitors charge.
2. The Psychology of Pricing
Customers don’t make purely rational decisions. Concepts like anchoring, decoy pricing, and charm pricing (e.g. £99 vs £100) play a significant role in willingness to pay.
3. Discounting Destroys Value
Price cuts are seductive but dangerous. Unless tied to real cost savings or behavioural rewards, they erode brand equity and profitability.
4. Small Price Increases, Big Profit Impact
Because price affects the entire revenue line, even a modest price lift can dramatically boost margins—often more than growing sales volume.
“Companies don’t profit because they don’t price well.”
5. Culture Influences Pricing Strategy
Attitudes toward negotiation, fairness, and value differ across markets. There’s no universal rule—what works in Japan may backfire in Brazil.
6. Communicate Value, Don’t Just List Features
A price is a story. If you can articulate the transformation your customer will get, you can charge more—and they’ll thank you for it.
7. Segmentation and Tiering
Different people are willing to pay different amounts. Don’t flatten your offer—use price ladders, packages, or add-ons to capture more value from different customer segments.
You can buy the book on Amazon.
Want more on pricing?
If the book isn't enough, then you may want to check out The Professional Pricing Society (PPS) which claims to be "the leading, world-wide pricing idea marketplace where new and seasoned business professionals from all industries come together for learning, training, and networking." This has too be a good investment.
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