What it is and what problem it solves
Most B2B companies don't have a pricing problem. They have a packaging problem. The same offer is sold to very different customers, and the only lever the salesperson has left is the discount. Margin gets negotiated deal by deal, and after a year nobody knows what the real price is.
The ladder breaks that cycle. It defines two to four tiers, what each one includes, what it leaves out on purpose and what condition moves a customer to the next one. The discount policy comes out of the same work: who can grant discounts, how deep and in exchange for what.
Our position is clear. A tier is defined by the job it does for the customer, not by what it costs to produce. That is why this tool comes after the winnability matrix and promise and proof. Without prioritized segments and a promise per segment, tiers get invented.
When to use it and when not to
It makes sense when at least one of these is true:
- Each salesperson decides the discount, and leadership only sees it at month-end close.
- Small customers get the same service as large ones at the same price.
- You are launching a new line and don't know whether to sell it on its own or inside a bundle.
- An agency wants to stop billing by the hour and start selling defined work outcomes.
Don't use it if you still don't know which segment you are going after first. Don't use it either if you sell a commodity whose price the channel sets: there the work is in the distributor's margin, not in the tiers. And it won't rescue a product that doesn't sell. A ladder organizes demand that already exists. It doesn't create it.
How it is built
- Inventory of what is already delivered. Everything a customer receives today, including what is given away without anyone saying so. Deliverable: list of components with their cost and who asks for them.
- Value by segment. Which components each prioritized segment values and which it ignores. Deliverable: components-by-segment matrix.
- Tier design. Entry, target and premium. The target tier is the one you want to sell most; the premium tier exists, in part, to make the target look reasonable. Deliverable: draft tiers with list prices.
- Upgrade triggers. For each step, the observable condition that justifies it: volume, number of sites, a new decision-maker in the purchase, a service requirement. Deliverable: upgrade rule per tier.
- Fences. What stops a premium-tier customer from buying the entry tier and asking for the rest as a favor. Deliverable: list of explicit exclusions.
- Discount policy. Maximum per tier, who authorizes it and what it requires in return: term, volume, upfront payment or permission to use the account as a reference. Deliverable: authorization table signed by leadership.
- Test against the portfolio. A sample of current customers is placed on the ladder to see who moves up, who moves down and who falls outside. Deliverable: simulation of the impact on revenue and margin.
Anatomy of the deliverable
The ladder is delivered as a one-page table that leadership signs and the sales team uses on every proposal. This is the template:
| Field | Entry tier | Target tier | Premium tier |
|---|---|---|---|
| Who it's for | Segment or customer size | Priority segment | Customer with more complexity or risk |
| Job it does | The minimum problem that justifies buying | The full problem of the priority segment | The full problem plus peace of mind for leadership |
| Includes | Components | Components | Components |
| Excludes (fence) | What is left out and why | What is left out and why | What stays outside the offer |
| List price | Figure | Figure | Figure |
| Trigger to move up | Observable condition | Observable condition | Not applicable |
| Discount without approval | Maximum | Maximum | Maximum |
| Required in return | Term, volume or payment | Term, volume or payment | Term, volume or payment |
| Approves anything above | Role | Role | Role |
The row that gets forgotten most is the fence. Without it, the premium tier doesn't get sold. It gets given away piece by piece. The second most forgotten row is what the customer gives in return. A discount with nothing in return isn't a policy. It's a habit.
The classic framework: good-better-best and price anchoring
Good-better-best offers three versions of the same thing, from less to more. It rests on two well-documented effects. Anchoring, described by Amos Tversky and Daniel Kahneman: the first number a buyer sees shapes how they judge the next ones. And the compromise effect, studied by Itamar Simonson: faced with three ordered options, many buyers avoid the extremes and pick the middle one.
We use it, with three corrections.
In B2B the anchor doesn't hold on its own
If the salesperson opens with the premium tier and closes with the target tier plus a discount, the anchor has only served to negotiate downward. That is why the ladder always comes with a discount policy. Without one, the list price is decoration.
Three is not a magic number
Some offers call for two tiers and others for four. The number is set by the segments and their different jobs, not by how the table looks.
The upgrade is missing
Good-better-best explains how the choice is made on the day of purchase. It says nothing about why a customer moves up later, and in B2B much of an account's value sits in that move. That is why every step carries its trigger. How to set the figure for each tier is covered in our guide to B2B pricing strategy.
Common mistakes
- Tiers built from cost. They are designed by whoever produces the service, who thinks in hours and materials. The customer can't see the difference between tiers and buys the cheapest one.
- An entry tier that does too much. It comes from fear of losing the sale. If the entry tier solves almost everything, nobody has a reason to move up.
- Discounts with nothing in return. This usually comes from compensation: if salespeople are paid on invoiced revenue rather than margin, the ladder falls apart in the first period. The ladder and the commercial plan are designed together, within commercial architecture and pricing.
- Names instead of differences. Basic, Pro and Premium explain nothing. Each tier's name should say who it is for or what it solves.
An illustrative scenario
Take a hypothetical industrial maintenance company in Santo Domingo that serves hotels, plants in free trade zones and retailers. Today it sells a single contract and adjusts it with discounts depending on who negotiates.
The ladder separates three jobs. Entry: scheduled preventive maintenance. Target: preventive maintenance plus response within an agreed time for critical equipment. Premium: all of the above, spare parts management and a periodic report for the customer's leadership, built for customers who face audits from their own clients. The upgrade trigger is observable: the number of critical units or an upcoming audit. Discounts open only in exchange for a multi-year contract.
The ladder doesn't say how much will be sold. That is measured against the signed baseline and reviewed in the period committee.