version: "1.0.0" name: pricing-playbook description: The 5 laws of Hormozi's LEAKED Pricing Playbook. Use it to analyze the current price, recommend a range, structure tiers and anchoring, and validate against the Value Equation and the market.

Pricing Playbook — 5 Laws

Source: LEAKED Pricing Playbook + cross-referenced with $100M Offers.

Law 1: Don't compete on price. Compete on value.

Before touching price, run the Value Equation (skill value-equation). If Probability sits at 4/10, dropping the price won't help — strengthen probability first (case studies, guarantees, a named mechanism).

Violation signal: "They charge X, I'll charge X-20%."

Law 2: Charge what it's worth, not what it costs.

Cost is your problem, not the customer's. Cost-plus pricing (cost + margin) leaves money on the table.

Value-based pricing:

• Measure the transformation delivered in dollars or time
• Charge 10-20% of the transformation
• Justify the price by the outcome, not the input

Example: if you help a client close an extra $100k in 60 days, charging $10-20k is defensible.

Law 3: Price signals quality.

A price that's too low = perception of low value.

Counterintuitively, high prices INCREASE:

• Customer commitment (skin in the game)
• Results (the customer actually applies it)
• Margin for a high-quality delivery
• Filtering out difficult customers

Rule of thumb: if more than 50% of leads say "done" without hesitating, your price is too low.

Law 4: Tiering captures more of the market without commoditizing.

3 standard tiers (silver / gold / platinum):

• Silver: core without premium support, entry price
• Gold (default): core + support + 1-2 bonuses (60-70% of customers pick it)
• Platinum: core + done-for-you + 1:1 mentorship + premium bonuses (10-15% pick it, but high margin)

Rules:

• The gap between tiers has to be perceived (not cosmetic)
• Platinum exists to make Gold look cheap (anchoring)
• Silver exists so you don't lose budget-conscious buyers
• Default = Gold (visual highlight on the LP)

Tiering by product category

These are market reference points (B2B/B2C, 2024-2026) — localize per market and currency. A wider range is fine; what matters is the ratio between tiers (Gold ~3-4x Silver; Platinum ~3-5x Gold).

Platinum's decoy function:

Platinum doesn't need to sell volume — it exists so Gold looks like "the obvious choice." 10-15% pick Platinum (high margin); 60-70% pick Gold, anchored against Platinum. If Gold alone were $11,997 with no $29k anchor, conversion would drop 25-40%.

Signs of broken tiering:

• Tiers too similar (Silver $297, Gold $397, Platinum $497) → false choice, nothing anchors
• No Platinum → Gold looks like the ceiling, the customer haggles
• No Silver → you lose budget-conscious buyers and gain nothing
• The difference is only "more hours/sessions" → commoditization, the customer compares hour to hour

Law 5: Longer runway, bigger ask.

If you serve the customer for 12 months, you can charge far more than for a 1-month engagement — because the anchor is bigger and the cumulative transformation is bigger.

Application:

• Long programs charge more per month (not less) than short ones
• The annual-package anchor > the monthly-package anchor × 12
• Genuine delayed gratification = a bigger ask

Pricing review workflow

1. Gather: offer + current price + 3-5 competitors + target margin + LTV
2. Run the Value Equation first (skill value-equation)
3. Score each of the 5 laws with a grade and rationale
4. Identify whether the problem is price or perception (critical distinction)
5. Recommend a range (not a single price), with explicit anchoring
6. Suggest a structure: tiers, installments, downsell, upsell
7. Suggest a validation test (next 10-20 leads) executable in 1-2 weeks

Signs of broken pricing

• Charging the same as a direct competitor (you're a commodity)
• No tiers, no anchoring (leaving revenue on the table)
• Price justified by hours/modules instead of transformation
• More than 50% say "ok, done" without hesitating (underpriced)
• More than 90% say "too expensive" and vanish (overpriced OR weak value equation)

Use by case

Detailed reference

See reference/leaked-pricing-playbook.md.