Are you just trolling now?
Ouch, that hurts!
Not in the least.
...what value you are providing to them, not how you are using the money.
Really now, you don't see any connection between the two?
I recently got a 'mailer' that came Fed-Ex Priority Overnight from some NY Jewler that I never have done business with let alone contacted, it contained at least 50 pages of photographic quality close-ups of sundry product. A smudgeable apparently hand-written personal note telling me about how i value 'value'...
Conservative cost of the mailer $50. Average Item cost $1000. Estimated time from opening until hitting the bottom of trash can: 45 secs.
Oh, and this is the third one this year... Even if I needed the jewels I would have a hard time buying from them... Why? If I buy a jewel from them I also just paid for the ridiculous marketing expense!
So I'll let you go to Jiffy Lube and let you pay for their annoying commercials. You might tell yourself that their commercials enable them to reach sales volumes where compelling economies of scale come into play. Whatever.
Which leads me to a more important point:
Everyone in this thread, myself included, have been handicapped by assuming the customer(meaning end-users not in the biz) can actually recognize 'true' value!
News flash: They can't, not really.! Blashphemy you say?
Now, take off the integrator/blogger/friend of the working man hat of yours and think like a consumer...
Can you say what a new car should cost? I can't... Break it down, try to find its 'value'. Did you know buying all the parts of a ($50,000) car seperatetly will set you back well over a million dollars(assembly not included)? Could you get a real handle on it? Maybe, but the time and expense would be enormous...
After you do cars, move on to value Central A/C units, Home Automation, Copper re-piping options, Baby Strollers, Planars/Jointers, Surfboards, Saxaphones, Radar Detectors, Medical Schools, Universities or whatever your looking to consume...
So what do consumers really do? They use shortcuts. One shortcut is to say I can buy X from A for $1 and X from B for $2 so A is a better value. Great until B says, yeah but I'm not selling X, I got Y, which you can see is much better!
The most common shortcut though is to try to get a sense of how much the person your getting the 'thing' from is profiting from it. To the extent that we feel that its not 'too much' we feel we are getting value! This is how most consumers determine value. Please state if you do not agree with this.
Customers are not directly trying to determine value by using internet pricing so much as trying to make sure that your not making too much... Internet pricing let customers make a much closer estimate of what that number is...
Consider this: Before the internet,the mfr. might price a line to distribution who would then provide inventory to integrators as several price points depending upon the integrators tier. This method allows for some price flexibility. However the integrator because of his proximity to the end-users situation, had by far the most 'flexibility' with price. Depending on the customer situation, he could charge wildly varying amounts. Now because of internet pricing he has lost that flexibility...
So yes, I agree with both you, Ari and the others that integrity is the way to go. But I am also trying to point out the 'real' drivers of the situation. To wit, your entry of 'validation testing' seems solid at first. But when I ask you are you doing the work or self or subbing and then proceed to ask what you are paying the sub, I assume you would comply, right? After all, is their an ethical difference between product cost and service cost? And if(when) the internet has shoppable 'service costs' you will be asked that question too. Because they're really trying to figure out what your making.
And no John I don't have an 'alternative', I wish I did, but for now the only 'value' I can add is my perspective on why we are where we are.