Good-Better-Best Pricing Strategy: How to Create It for Your Business?

By Thomas Bennett Financial expert at Priceva
Published on December 19, 2023
In today's competitive market, pricing strategies play a pivotal role in attracting and retaining customers. Among the various approaches, the Good Better Best (GBB) pricing strategy stands out for its ability to cater to diverse customer needs while maximizing profitability. This strategy, revolving around tiered pricing, is more than just setting different price points; it's about understanding customer psychology and market dynamics.

What is a Good, Better, Best Pricing Strategy?

The GBB strategy, a highly effective pricing structure, presents products or services in three tiers: good, better, and best. Each tier is strategically designed to meet distinct customer needs and price sensitivities, thereby catering to a wider audience. This tiered pricing model not only simplifies decision-making for customers but also strategically positions each tier to appeal to different segments. The 'good' tier typically targets price-sensitive customers with a basic yet satisfactory offering. The 'better' tier, positioned at a slightly higher price point, offers additional features or benefits, attracting customers who are looking for something extra. The 'best' tier is the premium package, often with multiple features and exclusive benefits, appealing to those who seek the best available option. This pricing strategy is particularly adept at attracting new customers while retaining existing ones, as it offers options for every level of interest and affordability.

Good, Better, Best Pricing Examples

In the service business sector, the Good Better Best pricing strategy is often exemplified through service packages. For instance, a digital streaming service might offer a basic package (good) with standard definition streaming, a better package with high definition and more content variety, and a best package that includes 4K streaming and unlimited access to all content. This approach not only addresses the different preferences of potential customers but also competently segments the market, avoiding a price war with low-cost rivals. Such a pricing strategy helps businesses avoid overwhelming customers with too many options, offering clearly defined packages that cater to distinct customer preferences.

Consumer Response to Good Better Best Pricing

Consumer psychology plays a significant role in the effectiveness of the GBB strategy. By offering tiered pricing options, businesses can attract price-sensitive customers with lower-priced offerings while also catering to those who prefer premium products or services. This strategy typically generates a positive response as it empowers customers to choose based on their individual needs and budget constraints. Such a structure helps in gradually increasing prices for different segments, thus performing a subtle cost-benefit analysis for the consumer. By offering clear price brackets, businesses can ensure customers focus on the value they receive at each level, making them feel more satisfied with their choice.

Role of Psychology in a Good-Better-Best Strategy

The Good Better Best pricing strategy effectively utilizes consumer psychology to enhance customer experience and increase sales. The concept of 'fence attributes' is crucial here, where each tier is differentiated based on specific features or services. This helps in setting clear mental boundaries for customers, making it easier for them to understand and choose between different pricing options. Moreover, this strategy counters the potential features overload that can confuse customers. By simplifying the decision-making process and aligning with the consumer psychology of wanting the best value for their money, the GBB pricing can significantly increase the likelihood of upselling and customer satisfaction. Additionally, it aligns with the Harvard Business Review's findings on consumer behavior, which emphasize the importance of meeting varied customer needs without causing decision fatigue.

Approaches to the Good-Better-Best Pricing Structure

It’s also quite necessary to know about various approaches to the pricing strategy.

1. The Defensive Approach

In the defensive approach to the Good Better Best pricing strategy, the primary goal is to protect the market share against low-cost competitors. By introducing a 'good' tier at a competitive price, companies can effectively attract price-sensitive customers and counteract the appeal of low-cost rivals. This tiered pricing structure allows businesses to maintain a balance by offering a lower-priced offering that still aligns with the brand's value proposition. This strategy is particularly useful for service businesses and those in highly competitive markets, where a price war can erode profit margins.

2. The Offensive Approach

The offensive approach in the Good Better Best pricing focuses on maximizing revenue through upselling. By creating an attractive and value-packed 'better' and 'best' tier, companies encourage customers to opt for higher-priced options. This approach is grounded in consumer psychology, where customers understand the additional benefits they receive with each tier upgrade. Through careful customer research and understanding the target market, businesses can set price points that encourage movement up the pricing ladder, increasing the average transaction value.

3. The Customer-Centric Approach

This approach is all about tailoring the Good Better Best pricing structure to meet the specific needs and preferences of different customer segments. By conducting in-depth customer research, businesses can identify potential features and fence attributes that appeal to each segment. The customer-centric approach ensures that each pricing tier, from 'good' to 'best', is designed with the target market in mind, offering pricing options that resonate with their values and expectations. This method is particularly effective in attracting new customers while retaining existing ones, as it addresses the varied needs across the customer spectrum.

How to Create a Good-Better-Best Pricing Structure

1. Determine What Products or Services to Group Together

Creating an effective Good Better Best pricing strategy starts with identifying which products or services can be logically grouped into the three tiers. This involves a careful analysis of the features, quality, and benefits of each offering. By categorizing products or services into 'good', 'better', and 'best', businesses can create clear price brackets that help customers make easy comparisons.

2. Understand Your Target Customers

Understanding the target customers is crucial for a successful GBB structure. Businesses must conduct thorough customer research to grasp the needs, preferences, and price sensitivity of their target audience. This includes understanding the consumer psychology behind purchasing decisions and identifying what customers focus on when selecting a product or service. This insight helps in creating tiers that resonate with the customers and attract both existing and potential customers.

3. Decide the Price Points

Determining the right price points for each tier is a critical step in the Good Better Best pricing. The pricing should reflect the perceived value of each tier and be competitive in the market. This may involve gradually increasing prices from the 'good' to the 'best' tier, ensuring each increase is justified by additional value. The price points should also be set with a clear understanding of the competitive landscape and the positioning of low-cost rivals.

4. Present the Options

The final step is to present the pricing tiers in a way that is easy for customers to understand and compare. This involves clear communication of the value proposition of each tier, ensuring customers understand the benefits and features associated with each option. Businesses should aim to present these options in a manner that does not overwhelm customers but rather guides them towards making an informed decision. This presentation is key to attracting customers who are price conscious and those who prefer premium options.

Tips for Creating a Good-Better-Best Pricing Structure

Reserve Discounts and Special Offers for Higher Tiers
To encourage customers to consider upgrading to a higher tier, reserve your most attractive discounts and special offers for the 'better' and 'best' categories. This strategy can effectively attract customers who are initially drawn to the 'good' tier but see greater value in the upgraded options.

Specify Exclusions or Limitations
Transparency is key in any pricing strategy. Clearly articulate any exclusions or limitations in each tier to prevent misunderstandings and maintain customer trust. This clarity helps customers make informed decisions and sets realistic expectations about what each tier offers.

Use Creative and Descriptive Names
The naming of each tier plays a significant role in its appeal. Use creative, descriptive names that encapsulate the essence and value of each tier. This not only enhances the appeal but also helps customers easily differentiate between the tiers and understand what each offers.

Pros and Cons of the Good Better Best Pricing Strategy for Products


Diversity in Market Reach: This pricing strategy is adept at addressing the needs of a broad spectrum of customers. From those who are mindful of their budgets to individuals seeking the finest options, it provides a range of choices that cater to varied preferences and financial capabilities.

Enhancement of Sales Value: By nudging customers towards premium tiers, the Good Better Best strategy holds the potential to elevate the overall transaction value. This is achieved as customers are often tempted to opt for higher-priced options when they perceive added benefits.

Stimulation of Higher-Tier Sales: The distinct separation of value across the tiers serves as an incentive for customers to upgrade. This delineation effectively stimulates interest in more expensive tiers, fostering an environment conducive to upselling.


Clarity and Understanding: The key to the success of this strategy lies in how well the distinctions between each tier are communicated. A lack of clear differentiation may lead to confusion, adversely affecting customer decision-making and satisfaction levels.

Demand for Comprehensive Research: The implementation of this pricing model requires an extensive understanding of both the market and consumer preferences. This necessitates a substantial investment in market research to tailor the tiers effectively to the target audience.

Risk of Sales Displacement: There's a delicate balance to maintain between the tiers. If the lower tier is perceived as offering significant value, it might lead to a scenario where it overshadows the higher tiers, thus cannibalizing potential sales of more profitable options. This effect is more pronounced if the perceived value difference across the tiers is not substantial enough to justify the price increase.

Why Does Price Bracketing Work?

1. Mirrors the Way We Buy

The Good Better Best pricing is designed to mirror the natural buying habits of consumers. By offering clear, distinct choices, this pricing structure simplifies decision-making for customers. It presents options in a way that aligns with how customers typically evaluate purchases, considering both cost and value without feeling overwhelmed by too many choices.

2. Focus on Your Packages, Not the Competition's

This approach effectively shifts the focus from a price war with competitors to the value provided within your own product range. By highlighting the unique benefits and features of each tier, customers are more likely to compare within your offerings rather than looking at external options. This strategy also helps in attracting new customers who may be evaluating similar offerings from competitors.

3. Sell More Without Being Pushy

One of the key strengths of the Good Better Best pricing structure is its ability to encourage upselling without the need for aggressive sales tactics. Customers are naturally drawn to better value propositions, making them more likely to consider higher-tier products or services once they understand the additional benefits they offer.

4. Shifts Conversation from Cost to Value

This pricing strategy shifts the conversation with the customer from mere cost to the overall value and benefits of each tier. This perspective helps customers understand and appreciate the incremental benefits and features of higher-priced tiers, facilitating a more informed purchase decision.

5. Appeals to Different Budgets

The Good Better Best strategy is inclusive, catering to a wide array of budgetary constraints. By providing options at different price points, businesses can attract a diverse customer base, from those seeking budget-friendly solutions to those willing to pay more for premium offerings.


Adopting the Good Better Best pricing is a powerful way to enhance business growth. This approach helps in effectively segmenting the market, catering to diverse customer needs, and maximizing revenue opportunities. With tools and insights from Priceva, businesses can skillfully implement and manage this strategy, optimizing their pricing structures to attract and satisfy a broad spectrum of customers.


What is the Good-Better-Best Pricing Strategy?

The Good Better Best strategy is a tiered pricing model offering products or services at three levels—good, better, and best. Each tier is designed to cater to different customer preferences and budgetary levels, making it a versatile approach for diverse market segments.

What are the Four Pricing Strategies?

The four primary pricing strategies include penetration pricing, price skimming, competition-based pricing, and value-based pricing. Each strategy varies in approach and is selected based on the product, market conditions, and business goals.

What are the Benefits of GBB Pricing Strategy?

The GBB pricing strategy is beneficial for attracting a diverse range of customer segments, enhancing the perceived value of products or services, and potentially increasing overall sales and customer satisfaction levels.

What is an Example of Good Better Best?

A classic example of this strategy is seen in the smartphone market, where models are categorized into basic (good), advanced (better), and premium (best) tiers, each offering different features and benefits at varying price points.

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