Pricing

🍜 We consistently beat the drum for pricing as one of the biggest levers your company has to pull around revenue, but it’s rare to find good writing on the specific tactics you can experiment with. Stripe’s Growth lead Julian Lehr laid out more than a few pricing strategies which are worth noodling over, starting with the basic idea that founders can likely charge more than they think. He also covers some great examples of “the illusion of choice”, in which companies provide one pricing package that clearly makes the most sense for the user – as well as themselves – which the visitor is funneled towards. This usually includes some social validation (like highlighting the price point as the most popular choice) and a direct comparison to other plans to show how much users are saving. 

🛫 A well thought out pricing strategy can end up being your company's biggest growth lever – Price Intelligently reports it has 4-8x the impact of the acquisition on your bottom line. Most companies start with a simple feature-based tiered model because it’s easy to implement and the most common approach. It’s helpful when trying to figure out how customers interact with your product, but as you get a better sense of where your value really lies, you should re-evaluate your strategy to make sure there aren’t more effective ways to price. For example, if you’re selling to more enterprise customers, pricing by different products in your business (with an aim to cross-sell into others in the future) may help embed yourself more deeply.