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  • Pricing will be one of the most important things you do for your business\n\n
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  • cost based pricing means you’re pricing too high when there isn’t a strong market for your product and too low when there is on\n\nnegative pricing allows you to calculate the cost to your customer of NOT using your product\n\nFind the balance between margin and volume (understand acquisition costs along with lifetime value of your customers)\n
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  • 1. secrets of pricing (as if I knew...) Chris Eben @ceben
  • 2. + ≠
  • 3. pricing should accomplish 3 things1. achieve financial/profitability goals2. support brand and positioning3. meet market and customer expectations - i.e. customers will buy
  • 4. psychology of pricing• anchoring - the baseline for your price going forward• you don’t always get to set the anchor
  • 5. cost vs value• cost based pricing is • value based pricing is easy hard• understand your costs • understand perceived vs but remember your quantifiable (ROI) value customers don’t care to the customer• don’t price based on • must be developed cost plus a desired through real customer margin insight
  • 6. pricing markets• analyzing the competitive landscape• how do you want to be compared to the competition?• brand impact - your price deeply impacts your brand• finding reasonable comparables / anchors• Typical models - what do customers expect already
  • 7. price testing• customer/analyst validation interviews• metrics and funnel • Pirate Metrics (Acquisition, Activation, Retention, Referral, Revenue - AARRR) by Dave McClure • SaaS Math by Mark MacCleod• split testing / experiments • Freshbooks is a great local example - Mike McDerment is an expert• rename/reconfigure products as necessary along the way
  • 8. niche pricing• pricing isn’t the hard part - positioning is• if you can access a niche market, your price point can be higher• any commoditization of your product or market will drive the price down to zero
  • 9. models• unit/perpetual• subscription• freemium (don’t mistake free trials for free) • pay for features, pay for usage, pay for privacy, pay to turn off ads, etc...• move customers through the funnel• in-app purchase
  • 10. Q &A Chris @ceben