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Innovative Pricing and Packaging Strategies

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Are you wondering how to price and package your services to drive up revenue and customer acquisition? Here is a teaser: It could be tiered pricing, charging for usage, upgrade plans, or segmented …

Are you wondering how to price and package your services to drive up revenue and customer acquisition? Here is a teaser: It could be tiered pricing, charging for usage, upgrade plans, or segmented pricing, but finding the right pricing combination makes the difference.


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  • 1. Why Zuora Zuora Provides a BluePrint to Succeed in the Subscription Economy! The Marketing Perspective: Innovative Pricing & Packaging Strategies
  • 2. 2 Joe Andrews Sr. Director, Product Marketing Zuora Mike Puglia Vice President, Marketing Timetrade Our Speakers @andrewsjoe @timetrade
  • 3. We call this shift the Subscription Economy™ Our world is shifting ShippingProducts Monetizing Relationships BUY NOW SUBSCRIBE The Subscription Economy takes the changes brought by the SaaS model and applies them to companies in every industry.
  • 4. Three Strategic Growth Levers in Subscription Based Businesses Increase Customer Value Reduce Churn Acquire New Customers
  • 5. 5 CMO How Do I Get My Arms Around My Pricing Strategy? How do I improve Time-To-Market & operationalize?How do I improve Time-To-Market & operationalize? How do I balance growth & revenue? How do I price vis-à-vis competition? How to I think about choice vs. simplicity? Do I price for new accounts or existing?
  • 6. 6 Pricing in Product World Cost Price TIME $ PROFIT
  • 7. 7 In the Subscription World, Pricing is Based on Recurring Usage
  • 8. 8 Four Basic Subscription Pricing “Metrics” Product 1. One-time 1. One-time (setup) 2. Fixed recurring 3. Per unit/user 4. Usage models
  • 9. 9 Consumers Have Unique Needs
  • 10. 10 It’s a Competitive, Dynamic Market Pricing and Packaging is Now a Powerful and Strategic Weapon
  • 11. 11 The Challenge: Where to focus & start? Company Launch International Growth Revenue Enhancement Product Expansion Pricing Optimization BUSINESS MATURITY COMPLEXITY Product Upgrade Different Billing FrequenciesSingle Product Simple Monthly Recurring Product Bundles Add-On Products A/B Testing Usage & Overage Pricing Tiers Regional Pricing Multiple Currencies
  • 12. 12 This is Not Where to Start
  • 13. 13 Continued…
  • 14. 14 And Continued Again…
  • 15. 15 Start Simply & Iterate 1 2 3Simple Recurring Model More Advanced Options Basic Iterations
  • 16. 16 Consider Fixed Recurring Model to Start Focus on Core Value Prop for Target Customers
  • 17. 17 As You Iterate, Add More Basic Options 17 1 2 3Simple Recurring Model More Advanced Options Basic Iterations
  • 18. 18 Use a Promotional Strategy to Acquire Customers Offer full trials to drive adoption Offer Full Trials to Drive Adoption
  • 19. 19 Consider a Freemium Strategy Give Away Base Product to Rapidly Acquire Customers
  • 20. 20 Freemium Considerations • Put your best foot forward • Take away, don’t offer “more” (less unhappy customers/refunds) • Embrace “free” • How do you end a trial?
  • 21. 21 One-Time Promotions Change Purchase Behavior Offer full trials to drive adoption
  • 22. 22 Bundling Strategy Offer Flexibility & Cross-Sell Offerings
  • 23. 23 Bundling Strategy – By Market/Vertical
  • 24. 24 Longer-Term Options to Lock In Customers Reduce Churn & Increase Commitments (TCV)
  • 25. 25 More Advanced Options 25 1 2 3Simple Recurring Model More Advanced Options Basic Iterations
  • 26. 26 Usage Based Pricing Pay as You Go & Limit Risk For Customers
  • 27. 27 Usage Based Pricing With Overage Balanced Risk For Customers & You
  • 28. 28 Regional Pricing Strategy US PricingA Asia PricingB Address Different Market & Segment Requirements
  • 29. Test Pricing/Packaging Changes 29
  • 30. 30 Be Mindful When Making Changes Talk to Customers & Communicate Changes Effectively
  • 31. 1. Pricing and packaging is a new strategic weapon 2. Start simply…then iterate with more basic strategies 3. Four basic pricing metrics for subscription businesses 4. Leverage a free promotional strategy 5. Test, test, test 6. Be mindful of communicating and deploying changes to your customers Summary of Lessons From Our Customers
  • 32. 32 www.subscribed.com code: “webprice” 50% off registration price through Aug 31
  • 33. 33 Joe Andrews Sr. Director, Product Marketing Zuora Mike Puglia Vice President, Marketing Timetrade Questions? @andrewsjoe @timetrade
  • 34. 34

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