Summary
In this episode, Sean discusses his approach to product pricing for B2B SaaS, from setting an initial price range to optimizing the structure based on data. He shares his experiment in testing price sensitivity, incorporating benchmark pricing, capturing inbound leads, and designing tiers based on feedback from paying customers. Sean also explains how he monitored usage and set limits around variable costs to ensure profitability.
In this episode, Sean discusses his approach to product pricing for B2B SaaS, from setting an initial price range to optimizing the structure based on data. He shares his experiment in testing price sensitivity, incorporating benchmark pricing, capturing inbound leads, and designing tiers based on feedback from paying customers. Sean also explains how he monitored usage and set limits around variable costs to ensure profitability.
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Key Points
- Start with a price range and test price sensitivity
- Incorporate benchmark pricing and customer feedback
- Design tiers based on feature demand and willingness to pay
- Monitor usage and set limits around variable costs
- Determine gross margin and profitability
- Use data to optimize pricing structure
- Consider raising prices to improve margins
Quotes
- “In the end, I just picked a place to start and that was that”
- “I even did some interviews with some of them and that was super helpful”
- “I wasn’t giving away too much, is that I wasn’t incurring so much cost and not generating enough revenue”
- “I’m gonna keep you posted along the way as I make those changes as well too”