Your product is your thinking.

Klarna’s standard merchant rate is somewhere around 3-6% of the sale.

Taking a card costs that same shop roughly 1.5-2%

It’s worth thinking about why

Some of it is straightforward.

Klarna pays the merchant upfront and carries the credit risk, so if the customer never pays, that’s Klarna’s problem now, not the shop’s.

That’s a real service and it’s worth real money.

But if that were the whole story - the fee would be priced like insurance and nobody would find it interesting.

The rest of what the shop is buying is a change in the customer.

More people finish the purchase instead of abandoning it.

And the ones who do finish spend more.

Same shop, products, person and time

Nothing about what they can afford has changed.

What’s changed is that the moment where they’d have looked at the total, done a quick sum, and quietly put one thing back never happened.

So part of that fee is credit.

And part of it is buying the absence of your second thought.

Somebody has run the numbers on your hesitation and decided it’s worth paying for.

Go and read your own sales page. The done-for-you plan.

The app that logs it for you, the check-in so you don’t have to decide, the templates, the meal prep guide, the ‘we take the guesswork out of it’.

Count how many times you promise less effort.

Nearly every offer in this industry is friction removal.

That’s the product, even if we don’t name it

And friction removal is the one job software wins on price.

Every year it gets cheaper and better at exactly the thing you’re charging for, and there’s no version of the next five years where coaches out-convenience an app.

The answer isn’t to make coaching harder.

Some friction is just admin.

The faff, the logging, the guesswork about what you’re supposed to do on Thursday.

Delete all of that - it’s a genuine service and clients shouldn’t have to carry it.

But some of that friction was the client learning to choose.

That one wasn’t in the way of the product - It is the product.

It’s important that we know what friction is important, and which isn’t.

Because we’ve all been told that easier is the same as better

I’d be interested to see what we’d find if coaches listed everything that their offer makes easier - and then ask which of those software / AI could do free soon

And if it would be the end of the business if it did.

Open it on its own page →