Jeff Mains hosted a killer webinar for his Champion Leadership group. In it, we explored the seven deadly sins of SaaS pricing—the most common pricing pitfalls entrepreneurs in the software world fall into.
Key topics we covered:
- Benefits of designing packages for customer self-selection and credibility
- Cannibalization fears and strategies
- Importance of research on customer needs and willingness to pay
- Regularly revisiting and iterating pricing based on market conditions
- Conducting pricing audits
- Choosing a primary pricing metric
Potent Quotables
Navigating the Subscription Model Transition:
“A lot of the companies who tried to make the perpetual to subscription model found this, death valley, this trough of sorrow that you go through is because you’re getting your payments over time, but you take all your customer acquisition costs on at once. You end up in this cash flow trough where it goes negative, and it can go negative quickly, even if you’re being very successful, soon you run out of money and can’t make it to the other side, and you die.”
— Dan Balcauski
The Hidden Pricing Crisis in Major Corporations:
“To give you a little bit of sense, even at the largest companies in the world, I think there’s, like, 37% of S and P 500 companies don’t have any employees with pricing titles, and 78% of the Fortune 500, have no dedicated pricing organization.”
— Dan Balcauski