While pricing a product our service is never an easy task, SaaS adds even more variables to an already complex equation.
Fortunately, this also allows for tiered and multi-axis pricing, as entrepreneur and VC David Skok explains in a recent post. When pricing an SaaS product, it’s important to consider the features that are being purchased. Some features (and feature sets) should naturally have higher price tags associated with them.
Scalable pricing is the answer to this pricing conundrum, Skok explains. A basic edition, for example, should provide a baseline price. Thereafter, incremental upticks, based on features, should dictate how much something costs. Buyers’ willingness to splurge for the highest-priced edition will undoubtedly help boost sales, too, says Skok.
One of the main benefits of multi-axis pricing is that it’s a value-based pricing system. The more the customer pays, the more value they’re getting.
For more on multi-axis pricing, read the full article by Skok.