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SaaS Pricing

Public • 512 • Free

4 contributions to SaaS Pricing
Value metric update
Hi team, is there any public case study that talks about how an organization with consumption-based pricing model moved from one value metric to another one? What are the operational steps they followed?
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New comment Nov 1
0 likes • Nov 1
Hi @Koyel De you can check this recent webinar by Paddle, in which James Wood presented a case of evolving/changing value metrics and considerations on selecting one or more value metrics:https://www.linkedin.com/posts/jameschristopherwood_evolving-your-pricing-strategy-the-next-activity-7234195545353789440-RGdH/
Usage metering tools
Hi pricing community, I’m looking to hear about anyone’s experience using third party tools to help implement usage metering. If you’ve done this, would you mind sharing a bit about your experience (i.e. which tool, problem it solved, duration of implementation, pros/cons, etc.). Thank you in advance!
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New comment Oct 2
0 likes • Oct 2
Hi @Jessica Overton no experience with metering tools, but I've come across these two recently: https://schematichq.com/ https://www.withorb.com/ Cheers!
Designing pre-approved tiers for usage-based model
I work in a CaaS (Communication-as-a-Service) firm offering communication APIs for SMS, Video, Voice, etc. For some of these APIs we offer usage-based pricing. We are mainly a sales-led organization with AMs in each region targeting and acquiring local and international customers. Problem and impact: one the APIs is in a highly competitive, mature stage. We offer Sales several tiers of pre-approved prices per volume thresholds to increase deal velocity. Impact: - Sales quoting highest volume threshold to unlock best price off list price - Feedback from Sales about lowest price: we are not competitive anymore in some markets, hence higher escalation because pre approved prices are not realistic. - Revenue goals not met because potential volume was unrealistic. Question: how to better design a better pre approved pricing framework for usage based model? Aim for simplicity and keep it as is with more realistic volumes and prices? Offer more tiers and price ranges? Different framework?
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New comment Sep 19
0 likes • Sep 14
@Ulrik Lehrskov-Schmidt Thank you Ulrik. Magnificient points. 1-3.) The current price architecture should be reviewed. Focusing less on the core metric, and looking for pockets of revenue found in MRR fees, and start, exit fees, and managed services 4) This would make the demand and revenue per customer smoother, as you mention in your book. Higher cost for small customers, less (and distributed ) cost the bigger the customers. 5) Good point as shared by @Carsten Kunkel 6) What do you mean with this one? Have the volume discount as a structural discount, they can use? Or just one price point? 7) Sales discounts. We have them in place, we just need to see how compliant we are in executing on them. 8) This is something we do for large deals. Not exactly for free, but we do 'give and take' when we have a multi-product deal. I would need to investigate internally if there are guidelines for executing this.
0 likes • Sep 19
@Carsten Kunkel thanks! Yes, frequent invoicing might be another collateral problem. Need to investigate this. Overage is something we are not worried today. It’s under performance instead. But the logic you mention remains: downgrade or pay the price according to the real consumption tier, not the forecasted potential at the beginning. Another way it’s setting minimum commitment to qualify for the first tier. About the forecasting for next year. Right, reviewing the actual consumption and revise volume for next year and corresponding price. The potential problem is that since there is no exclusivity and customers can work with different providers at the same time, they might just choose other provider and not use our API. Unless our product and service is significantly more valuable than others and switching costs are high, so they decide to accept the negotiated volume and price.
What community activities/content would you like?
Hi guys What community activities and content would you like (or even participate in)? Stuff I can do: 1) Open Q&A with me (e.g. monthly) 2) Teardowns: send me your pricing case and I'll record as I open it up and provide live feedback. 3) Webinars on topics (like the ones scheduled) 4) ? ... let me know Stuff community members can do (but I can help arrange): 1) Cases: go on a podcast with me and show off your pricing project: objectives, process, new model, outcome, learnings etc. 2) Pools: e.g. 'How often do you change pricing?' 3) Guest speakers: we invite people to come and give an AMA session, present their work, their new book etc. (or that guest speaker is YOU!) 4) Collaborative Document Creation: someone posts a link to a google doc with a 1st draft of a document like: an email to tell customers prices go up / end of life of a product / job posting for a pricing manager / SOP for sales to give discounts / ?? - community can then edit, comment and create a 'final' version (or 7 different versions), which gets put in a common library for all. 5) Experience marketplace: e.g. "I need some coaching on how to get Sales to stop selling bespoke solutions. I can offer tested framework for how to prioritise feature development in collab between Sales and Product" -> people find each other and take it to a private conversation. 6) ??? let me know your ideas Use this thread to discuss, suggest and just to let me know what you'd actually invest time and attention in consuming, participating in etc..
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New comment Sep 4
2 likes • Aug 27
Thanks @Ulrik Lehrskov-Schmidt Stuff you can do: 1) I like this one specially on sensitive topics such as internal change management when it comes to P&P, Pricing strategy changes, and sensitive topics that change paradigms. 3) Webinar of a topic balancing between theory and practice. Sometimes one consumes lots of concepts, but lack a guide of in the real world one could do it Stuff we can do: Again leaning towards the practical side. 1) I like the end to end approach of the cases. 4) Share documentation and step-by-step process on how we do things in our jobs, such as fencing, pricing committee structure, participants and topics discussed, product packaging and laddering setting, customer segmentation, pricing setting process, cohort analysis, pricing communication.
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Jose Veloz
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1point to level up
@jose-veloz-6318
SMS Pricing Manager @ Vonage Previously @ Sixt and Applied Medical I like specialty coffee, jazz and Rick music and working out at the gym

Active 13d ago
Joined Aug 25, 2024
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