Pricing health should not be a one-off exercise for B2B SaaS companies. Sadly, too many treat it as an afterthought until you need to launch a new product or hear that “the pricing and packaging model is broken.”
So it’s pretty clear – run more pricing tests. People have strong opinions about the price. Capturing the relative trend over time will save you so many headaches you don’t have yet!
Who does the testing: pricing/monetization strategy team + PMs + PMMs. This group is collectively responsible for addressing the features getting built, the value/benefits, and hypotheses around how the company expects to make money from them.
Who do testers survey: internal groups (Sales, CSMs, Renewals, Sales Engineers), customers, and third parties (Gartner analysts, IDC analysts, industry watchers).
- Build a survey – make it simple, then make it simpler
- If you’re analyzing pricing health, test the following and build in demographic slices for Segment, Region, Product coverage, Sales role:
- How would you describe your perspective on _____ pricing? [Very expensive, expensive, neutral, inexpensive, very inexpensive]
- Rank the following factors that contribute to your previous answer on pricing [pricing relative to competition, customer’s cost to build, pricing relative to budget, functionality delivered for price, ROI, other]
- Rate your satisfaction on the following: price meter, list price, net price, discount flexibility, deal structure/terms
- How much do you agree or disagree with the statement that X product delivers the value I expected?
- How would you rate the price vs. value of our product vs. competition? [higher/similar/lower vs. better/worse combinations]
- If you’re launching a new product, then at a minimum test the following once you’ve described the product:
- What capabilities do customers value?
- What is right package of capabilities that customers expect to be included (i.e. what’s “in the box”) vs. charged separately for
- How does the value scale (i.e. what’s the “price meter” – # users? # of tacos?)
- What’s the price point of the box?
- Pro tip: start with 5-7 Sales interviews to get a feel for the need/problem
Develop a schedule: send out a quarterly pricing health survey to Sales/CSMs, set up a bi-annual pricing interview with your top analyst, bring up pricing at the Customer Advisory board once a quarter – if it’s not longitudinal (i.e. you can track over time) you’re missing valuable insights
Don’t wait to survey pricing until you have a problem or new launch. Know how your trends are performing before the next fire drill.
The Lemonade Problem 