It is said that “beauty is in the eye of the beholder”.
Something similar can be said for “value” when it comes to b2b SaaS.
Is it in the eye of the buyer or maybe head?
A lot is written about pricing tactics and pricing models:
– Create 3 editions
– Guide people towards middle
– Provide an entry version free or dirt cheap
– Show how you are better than a cheaper (or pricier) competitor
Lot of it is good advice and some of it is actually useful, if you are a commodity solution.
Commodity solution – there are plenty of players offering something similar to yours and any one of these solutions can do roughly the same thing.
Examples: marketing automation, contact management, basic invoicing and accounting, etc.
However, if you have a solution that is not a commodity then you should be spending more energy and time on articulating its value rather than fidgeting with pricing models and doing A/B testing on various pricing pages.
Let’s say you offer a solution that helps increase sales in store.
The value is the amount of increased sales.
If you offer a productivity solution then it could be the time and money saved.
These are simple examples.
More complex tools and solutions require a more serious effort to model the value.
If you actually put in the effort then you will be having discussions around establishing value than negotiating on price.
How much would a customer pay for increasing revenue by 2%.
If the base is $1M?
What if the base is $10M?