In a recent Zenskar Webinar, I enjoyed joining host Saurabh Agrawal for an insightful discussion on mastering value-based pricing for B2B SaaS products. Together, we explored the critical role of customer segmentation in shaping effective pricing strategies, emphasizing the necessity of understanding diverse customer needs and their competitive alternatives.
Our conversation highlighted the importance of creating differentiated value to boost pricing power and the strategic trade-offs in targeting and segmenting customers. We also tackled the complexities of price differentiation, using practical examples like volume-based, time-based, and persona-based models, including LinkedIn’s approach. Saurabh raised some thought-provoking questions, particularly about managing prospects who resist paying the value derived and assessing value for AI-driven commoditized products. We rounded out the session by examining the essential role of pricing governance and the need for clear decision-making authority, advocating for product marketing leadership supported by a cross-functional pricing committee. To top it off, we addressed the ever-present challenge of customer skepticism and the necessity for robust value communication and differentiation strategies.
Timestamped Outline
05:48 Promoting social good and functional benefits.
09:13 Emphasizing value and differentiation for higher pricing.
12:52 Always consider long-term games in business.
18:47 Discussing the importance of time in financial jobs.
21:03 Value-based pricing is crucial but underutilized.
25:47 Migrating from legacy systems for competitive advantage.
30:43 Differentiating price points based on customer segments.
34:25 Spreadsheet may not reflect unique business needs.
37:06 Stand out in the market, apply game theory.
38:21 Foundational model companies facing changing API costs.