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SaaS Pricing

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7 contributions to SaaS Pricing
Restricting Number of Users in a GBB Model?
In a GBB editions packaging model, one thing that I have come across quite a bit is having the number of users that each edition can support be restrcted, e.g.: - Good: max users allowed 5 - Better: max users allowed 10 - Best: unlimited users Note that these are not included users, they still have to be bought at whatever scale metric/tiering you might be using. The premise is that we thus avoid having a customer that should fall into a higher edition purchase a lower edition. I have a few issues with htis approach: It is that this is a sort of artificial fence between editions that has nothing to do with the value delivered. We are effectively forcing, rather than shepherding the customer into buying a specific edition, at best resulting in some bad feelings. In reality, sales conversations often end up discussing these limits with customers when they could be spending that time closing the deal. The better way to address this is obviously to create fences based on features. The value should come from using the product's features, not a tax for being a more efficiently run business that results in you needing less users. I bring this up here because Sales often like this approach of restricting users, and it's surprisingly difficult to get them off that horse. Has anyone had the same experience I have, and how have you worked with Sales to enable/coach them to change their way of thinking? Do you have circumstances where the artifical restrictions of users available per edition is an appropriate ringfence to differentiate between editions?
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New comment Sep 5
0 likes ‱ Sep 5
Super helpful @Ulrik Lehrskov-Schmidt - and I love the format!
Pricing Governance
Hey Ulrik I really liked your session today and how you get all your stakeholders to agree on pricing within a single workshop. My biggest question is how to ensure ongoing collaboration later. In my experience it's very difficult to keep stakeholders aligned on pricing objectives, given their different interests. Have you come across any solution that is less formal than a regular pricing alignment meeting? From which point on would you recommend dedicated pricing/revenue growth professionals?
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New comment Sep 1
0 likes ‱ Aug 31
It seems what you are describing effectively several layers of agreement. So: - to reach a concensus at the lower layer (sales pros, product, engineering, marketing etc. Ah, don't forget Finance!), - resulting in a series of choices (of which just one is the clear winner because you will have all the data already to support that choice after having done all that pre-work) that are available to the top layer (what I would call the core PC, usually C-Level) to make a decision. The first step is the hard step. Sometimes Pricing end up telling Sales what the best thing to do is. Call me cynical, but so often, Sales would rather pick the option that allows them to come up with whatever price they want or that gives them the most leeway. Especially in more established vendors, Pricing has to be the one that pushes back and proposes a way forward that allows for better governance.
1 like ‱ Sep 1
@Ulrik Lehrskov-Schmidt Agree 100%, Pricing function coordinates/facilitates, incuding understanding how decisions made by the PC and, ultimately P&L owners (who execute/champion on the decision) can be executed. It's those local champions that will have to translate a top-down view into actual results. Also agree that an elegant solution is somewhat elusive. This discussion proves that.
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
0 likes ‱ Aug 31
Love the teardown idea @Ulrik Lehrskov-Schmidt. Also - No. 4: Pricing communication is a massively important topic, often underestimated in terms of effort required to get the messaging just right. No. 5: Another great topic, and often 'handed over' to Rev Ops. Happy to contribute. Another idea would be the whole topic of price increases generally. Worth its own topic, I think, because it's a massive project every year.
Why Pricing Ops as a Function is inexistent? Any examples of companies with PriceOps?
One of the most puzzling questions I have as a management consultant on Strategy & Margin is the lack of PriceOps. We know research shows that companies that evaluate, adjust and change pricing often, grow several folds faster. We start to see RevenueOps adopted in some organizations (I created RevOps Transformations at PwC), but PricingOps is a very important part of RevOps. I think Pricing should be considered a core function of a business, and not a standalone project done when... well, we are running out of money or we are raising a new round. Any thoughts on this?
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New comment 25d ago
2 likes ‱ Aug 29
Really important discussion. There is a related thread here, where I have commented, keen to get folk's views (on this thread or the other): https://www.skool.com/saas-pricing/backend-activities-for-a-successful-packaging-pricing-project?p=e3743e30
Operations/backend activities for a successful packaging & pricing project
Good morning, I am curious to understand what you have seen as key success factors when it comes to work that needs to be done behind the scene (i.e. systems like CPQ, masterdata, managing your SKUs...) in order to successfully execute a new package and pricing design. Thanks!
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New comment Sep 6
3 likes ‱ Aug 29
This is really a pure Pricing Ops function. In bigger companies, you would have a separate Pricing Ops function - a key enabler to the Pricing team that ensures operational viability. In my experience, this can be a mixed bag in smaller companies where this is not a separate function. There, this is mostly covered by Rev Ops/Sales Ops, or, if you do have an internal dedicated Pricing function, by the Pricing function. Product are not usually in charge of this and let's face it, nor should they be. Irrespective of who carries out the task, main areas of action would be: - advise whether a proposed packaging strategy is possible/advise on what needs to happen to make it happen (system changes etc) - be the ONLY ones the CPQ team takes guidance from when it comes to new SKU requests - they OWN that stage gate thus avoiding SKU sprawl by a thousand cuts. This happens even in bigger companies and is a good one to get a grip on early. - manages SKU framework (this is a bigger deal than first meets the eye, especially when you consider currencies, bundles, tiers, revenue types, revenue frequencies etc) - ensures that those SKUs will flow through the whole ops process smoothly, all the way through contracts and billing, and rev rec, with revenue types allocated accurately. - manages price books (related to the last bullet) - They also cover reporting - on the effectiveness of a pricing initiative etc - and annual price increases/indexation but that isn't in your question..I'm just mentioning it here. I'd love to see what others think.
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Ron Kugler
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6points to level up
@ron-kugler-3017
Passionate about pricing properly - at scale and for every deal

Active 27d ago
Joined Aug 21, 2024
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