Prompt Playbook: Getting ready for revenue PART 3

You've built something valuable. People want it. Now comes the question that makes every entrepreneur sweat: "What do I charge?"

Price too high and nobody buys. Price too low and you work for free while burning through API costs. Price wrong and you either starve or go bankrupt.

It’s a Goldilocks problem. And not an easy one.

However, getting pricing right isn't about finding the perfect number (hell, that’s too hard) - it's about finding a starting a decent starting number you can test and improve upon.

Let's get started

Why Pricing Paralysis Kills Businesses

Whole textbooks and courses have been written on pricing. I did one during my MBA. It was about as exciting as you imagine.

Here’s the main takeaway I had: perfect pricing doesn't exist. But bad pricing definitely kills your business. We need to fall somewhere in the middle and, more importantly, we need to do it quickly so we can move on.

I've watched brilliant entrepreneurs spend months researching the "optimal" price while competitors launch, get customers, and iterate based on real feedback. By the time the perfectionist launches, the market has moved on. And whatever they decided upon is no longer relevant.

Your goal isn't perfect pricing - it's confident pricing. Pick a number you can defend, test it with real customers, then adjust based on actual data.

Multiple Approaches to Find Your Price

There's no single "right" way to price your AI tool. We’ll use several methods to triangulate a reasonable range:

Method 1: Cost-Plus Pricing Calculate your actual costs, then add profit margin. Most reliable for protecting your business. This gives us a nice conservative baseline but is unambitious.

Method 2: Competitor Analysis See what similar tools charge, position yourself accordingly.

Method 3: Value-Based Pricing Price based on the value you deliver to customers.

Spoiler: value based pricing is my favourite. And the ultimately best method here. But right now you don’t have enough intel to make a call on this! So we need a range of methods to land on a good starting price first.

AI Pricing Research Assistant

Let’s go ahead and use AI to do the heavy lifting for us. Specifically I’d put this in a deep research mode so that the AI can gather up information for you:

I need to determine pricing for my AI tool. Help me calculate using multiple methods:

My tool: [description of what it does]
Target customer: [your niche]
Problem solved: [specific pain point]
Average usage estimate: [X generations per user per month]

Calculate pricing using these approaches:

1. COST-PLUS METHOD:
- API cost per generation: $0.013
- Estimated monthly usage per customer: [X generations]
- Total monthly API cost per customer: $X
- Recommended markup: 10x-20x for software
- Suggested price range based on costs

2. COMPETITOR ANALYSIS:
- Find 5 similar AI tools in [my niche]
- List their pricing and what's included
- Identify pricing gaps or opportunities
- Suggest positioning (premium/standard/budget)

3. VALUE-BASED PRICING:
- Time saved per month: [estimate hours]
- Value of that time at $50/hour: $X
- Current solution cost: $X
- Frustration/pain factor: [high/medium/low]
- Suggested price as % of value delivered

Use these methods combined to output 3 specific price points (low/medium/high) with justification for each approach.

Start Low and Raise Prices Strategically

After your research gives you a price range, generally you’ll want to start at the lowest defendable price. Here's why:

You can always increase prices. Current customers stay locked in (“grandfathered”) at their original price, so they feel rewarded for being early supporters.

Lowering prices screws early adopters. They paid more and feel ripped off. Bad look for any business. The first in should get the best treatment.

Raising prices creates urgency. "Price going up next week - last chance to lock in founder pricing" converts fence-sitters. It’s a built in urgency trigger and we love those.

It lets you test price sensitivity. We can keep raising prices until you hit resistance, then you've found your market ceiling.

Example Strategy

• Launch at $29/month (founder pricing)

• After 25 customers, raise to $39/month

• After 100 customers, raise to $49/month

• After 250 customers, test $59/month

This means the first people in the door get what is always the best deal. This is how I operate my businesses. Early adopters put their trust in me so get the best deal. Fence sitters get a higher price.

It also means that each time you bump the price you can go to your audience and say “hey it’s going up from $29 to $39” shortly - you in? Lock in the price now”. Super effective and it gives you the ability to run “sales” without ever discounting (and devaluing your product).

It also means you can bump the price and see how it affects conversion. $10 extra and only a 3% dip in conversion - solid, lock in the new price. $10 extra and a 80% drop in conversion? You’ve found resistance, stick to the original price.

Update Your Stripe Product

Once you've chosen your price

1. Go to your Stripe Dashboard → Products

2. Edit the product you created yesterday

3. Update the price to your chosen amount

4. Update the description if needed

5. Test the checkout flow with your new pricing

Your Lovable integration will automatically use the updated Stripe pricing.

Your Deliverable Today

By end of day

• Multiple pricing calculations completed using AI prompts

• Chosen starting price (lowest defendable option)

• Stripe product updated with initial pricing

Build in Public Content

Share your pricing journey

"Day 33 of AI Summer Camp: Decided on pricing at last!

Researched 6 competitors (range: $29-79). Calculated value delivered ($400/month time savings).

Landing on $39/month. It’s a good starting point. I’ll definitely increase from here”

What's Next?

Tomorrow we’re adding another technical element. We’ll add usage limits and credit systems. Your pricing is set, now we need to protect those margins with smart usage controls that prevent runaway API costs.

Keep Prompting,

Kyle