If your client can’t figure out how much your SaaS app will cost them in the next 5-10 seconds, we’ve got a problem. Okay, okay, I’m not really mad. I still love you. But let’s be real, pricing for your SaaS needs to be as simple as ABC for everyone involved - prospects, leads, and your loyal customers.
Just yesterday, I found myself tangled in two separate conversations about pricing. Despite our best intentions, we often end up in the same predicament. It seems we’re caught between a rock and a hard place, trying to extract maximum value or making it easy for clients to scale with our solution. Ironically, figuring out the price turns out to be the hardest part.
What your buyer is actually thinking
Here’s the thing - customers don’t lose sleep over the mechanics of your pricing. What keeps them up at night is wondering:
- How much is this going to cost me every month?
- How does this fit into my budget?
- Does the cost justify the value I’m expecting to receive?
- Is this price set in stone, or should I expect some surprises?
If your client is scratching their head trying to work out your pricing, you’re already on the back foot. They’re not pondering whether to buy; they’re stuck on “how much does this thing cost?”
So, what’s the fix?
I won’t sugarcoat it - pricing is a beast.
You’ve got a ballpark figure of what you want to make. You’ve got estimates on product usage. So, draw a line in the sand and present a three-tier package: small usage + users, medium + advanced functionality, and large + custom options.
Aim to place your desired average monthly recurring revenue (MRR) at either the entry-level or the middle tier, then upsell the rest. Granted, this advice is pretty broad and might not fit everyone’s bill. And if it doesn’t work for you?
Well, that’s not my problem. 😂
But if you’re constantly getting feedback that your pricing model is as clear as mud, it’s time for a rethink. Yes, simplifying your pricing is tough. But right now, you’re making it tough for your customers or potential customers. We need to shift the burden from them to us.
And you know what? That’s perfectly fine. You’re resilient. You’re capable. You’ll crack this nut. So, here’s to making things simpler. For everyone.
Transparency is the whole game
Your pricing structure shouldn’t be a puzzle that clients need to solve. It should be straightforward, allowing them to quickly assess the value of your product against its cost. This clarity not only enhances the customer experience but also builds trust. When clients feel confident in understanding what they’re paying for, they’re more likely to invest in your product.
Moreover, consider the psychological aspect of decision-making.
A complex pricing model can lead to decision fatigue, where too many options or unclear costs lead to indecision or avoidance. Simplifying your pricing not only aids in quicker decision-making but also reduces the cognitive load on your clients, making them more inclined to proceed with a purchase.
Take a hard look at your pricing model
Is it as clear as daylight? Does it facilitate or hinder your sales process?
Remember, the goal is to make it as easy as possible for your clients to say “yes.” Pricing is one lever; control points and time to value are the other two that decide whether they stay after they’ve said it. By demystifying your pricing, you’re not just easing their decision-making process; you’re also setting the stage for a smoother customer journey and, ultimately, fostering long-term relationships.
Happy hunting, and good luck. Remember, keep it simple, idiot!
Clarity is one question; what you actually charge for is the harder one, and that’s per-seat, per-client or per-entity. Pricing sits inside positioning, which is where our go-to-market strategy work starts.
