The State of SaaS Pricing [Infographic]

Kyle-Poyar by

Infographic by Rachel Worthman.

Over the past several months, OpenView has surveyed more than 1,000 SaaS leaders to better understand how they price their products. What we’ve uncovered is a lack of maturity around product pricing in general. More specifically, we’ve found that all too often companies fail to designate a specific team member to head up pricing. Instead, many CEOs take on the burden. Moreover, our data shows that decisions around pricing are made far too late in the product launch cycle. The combination of these factors means that companies are missing out on much needed revenue by failing to properly set prices.

If you haven’t taken our interactive survey and want to see how you compare to your peers, you can fill out our Pricing Maturity Calculator here. In the meantime, check out the infographic below to gain a better understanding of the state of SaaS pricing.

View full size infographic here.

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  • I assume the pricing is ACV not TVC or lifetime value

    • Kyle Poyar

      Yes, that’s correct.

  • ptown_nearthectown

    As the scope of this is SaaS, I’m going to presume that a large percentage of those surveyed are startups and therefor do not have a CFO or even a COO in place with a full purview of the company’s finances. That’s why in early stage, it’s a burden taken on by the CEO, or at least he/she works in conjunction with a Biz Dev VP to set the pricing.

  • Erika Parker

    Many companies believe that uniqueness of their SaaS products excludes the necessity of pricing policy. And that’s why most products, which prices don’t match market realities or customer preferences, fail.

    Once I bought a free software product from a trusted company, and it completely satisfied my needs. But then they slapped with super expensive premium. It was unexpectedly and repulsive. I refused their product and exchanged it for its analog.

    That experience made me think much more cautiously about my company`s pricing strategy. And after intensive brainstorming, we consider value-based pricing trustworthy.

    As I can see in your infographic 40% of the respondents choose the same option. This approach implies that the price depends on the value that your product delivers to the consumer. It is even better when your clients purchase a product with an unquestionably high value and pay less for it. You should explain to them how they benefit from this deal.

    Your infographics were good enough to understand problems in SaaS market. I was particularly surprised by the number of the respondents who consider pricing while launching a product (35%!). It`s not far-sighted at all. And why do so few organizations have pricing team or at least manager?

    For SaaS startups, I also recommend reading this research https://kraftblick.com/blog/saas-pricing-models/
    Here you can find examples of companies and explanations why they use this or that pricing model, some useful tips to begin with.