The CMO's Guide to the Subscription Economy: Innovative Pricing and Packaging Strategies (Subscribed13)

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Learn strategies for accelerating your marketing levers to drive business growth and hear best practices first-hand from businesses that have done it. Learn how to use pricing and packaging as a tool to increase customer acquisition, value per customer and reduce churn. Learn about how to leverage new subscription commerce capabilities across multiple channels.

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The CMO's Guide to the Subscription Economy: Innovative Pricing and Packaging Strategies (Subscribed13)

  1. 1. Marketing Panel Innovative Pricing & Packaging Strategies Brian Bell CMO Joe Andrews Sr. Director, Product Marketing @andrewsjoe@brianbell123
  2. 2. In The Subscription Economy, Focus Is On Relationships Product Relationships BUY NOW SUBSCRIBE
  3. 3. Three Strategic Growth Levers in Subscription Based Businesses Increase   Value  of  Your  Customers   Reduce     Churn   Acquire     New  Customers  
  4. 4. $ PRICE   ITERATE   Pricing and Packaging Supports Your Key Growth Strategies
  5. 5. How Do I Get My Arms Around My Pricing Strategy? CMO How do I balance growth & revenue? How  to  I  think  about   choice  vs.  simplicity?   Do  I  price  for  new   accounts  or  exis@ng?   How  do  I  price     vis-­‐à-­‐vis  compe@@on?   How  do  I  improve       Time-­‐To-­‐Market  &   opera@onalize?  
  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 Price “Metrics” 1.  One-­‐:me   1.  One-­‐:me  (setup)     2.  Fixed  recurring   3.  Per  unit/user   4.  Usage  models     Relationships Product
  9. 9. Consumers Have Unique Needs
  10. 10. It’s a Competitive, Dynamic Market
  11. 11. The Challenge: Where to Focus and Start? Company Launch International Growth Revenue Enhancement Product Expansion Pricing Optimization B U S I N E S S   M A T U R I T Y   COMPLEXITY   Product  Upgrade   Different  Billing   Frequencies   Simple  Monthly   Recurring   Product  Bundles   Add-­‐On  Products   A/B  Tes@ng   Usage  &  Overage   Pricing  Tiers   Regional  Pricing   Mul@ple   Currencies  
  12. 12. This is Not Where to Start
  13. 13. Continued…
  14. 14. Continued…
  15. 15. And Continued Again…
  16. 16. Start Simply, Then Iterate 1   2   3   Simple   Recurring     Model   More   Advanced   Op:ons   Basic   Itera:ons  
  17. 17. Consider Fixed Recurring Model to Start Focus  on  Core  Value  Prop  for  Target  Customers  
  18. 18. As You Iterate, Add More Basic Options 1   2   3   Simple   Recurring     Model   More   Advanced   Op:ons   Basic   Itera:ons  
  19. 19. Use a Promotional Strategy Offer  Full  Trials  to  Drive  Adop:on  
  20. 20. Consider a Freemium Strategy Give  Away  Base  Product  to  Rapidly  Acquire  Customers  
  21. 21. Bundling Strategy Offer  Flexibility  &  Cross-­‐Sell  Offerings  
  22. 22. Longer-Term Options to Lock in Customers Reduce  Churn  &  Increase  Commitments  (TCV)  
  23. 23. More Advanced Options 1   2   3   Simple   Recurring     Model   More   Advanced   Op:ons   Basic   Itera:ons  
  24. 24. Usage Based Pricing Pay  as  You  Go  &  Limit  Risk  For  Customers    
  25. 25. International Pricing US  Pricing  A Asia  Pricing  B Address  Different  Market  &  Segment  Requirements  
  26. 26. Testing & Iterating Op:mize  Both  Promo:onal  and  Core  Pricing  Strategies   ITERATE  
  27. 27. Be Mindful When Making Changes 27   Talk  to  Customers  &  Communicate  Changes  Effec:vely  
  28. 28. Lessons From Our Customers 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
  29. 29. Meet the Panelists Demandbase Greg Ott, CMO Fuzebox Eran Shtiegman VP Product Insideview Brian Kelly CMO Zuora Brian Bell, CMO @brianbell123 MuleSoZ   Chris  Purpura   VP  &  GM   @chrispurpura   Marketo   Bill  Binch   SVP  Sales   @bkkelly  
  30. 30. END

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