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Pricing Low-Touch SaaS
41–50 of 86 posts
Re: Pricing Low-Touch SaaS
#42[deleted]
Re: Pricing Low-Touch SaaS
#43I have a related question: Is high-touch saas (enterprise sales with long sales cycles) inherently harder to bootstrap than a low-touch saas business? I'm guessing the answer is something like "not if you have the network"
In most scenarios, high-touch saas is harder to bootstrap. Your network will smooth out the friction of getting in the door, but there are other factors that make this hard to bootstrap:
* Expensive headcount - high-touch sales requires sales, marketing and other GTM teams. Sales, especially, is very expensive. * Customizations - enterprise customers will want additional features above and beyond what your MVP offers. This will require additional engineering/product/design resources * Security audits - IT of the enterprise customer will want to see recent security audits which can range from $20K and up * Stability guarantees - enterprise customers are wary of offloading their workflow to small startups that might go belly up. Having guarantees, such as VC funding, will acquiesce them.
A common path in B2B is to start with low-touch SaaS business (which is easier to bootstrap) & then move up-market.
Re: Pricing Low-Touch SaaS
#44[deleted]
Re: Pricing Low-Touch SaaS
#45Earlier quoted context omitted.
As much as I enjoy the thought of a Netflix where I'd pay for how much I actually watched (like how cloud hosting is billed). I think it also opens the possibility that they'll be creating content that abuses that notion. Like, longer content for pay per minute. Or longer seasons for pay per episode. But the idea sounds great to me.
Frankly Netflix scares me and I am scared more by the proliferation of the Netflix model to video games. What I saw happen with television is that it went from a ratings based model (they had to make stuff people wanted to watch) to a model where the "cable bundle" was determined by cigar-chompers in a dark room somewhere. I can say I want this group of 20 channels, but I can't say I want CNBC but not CNN, Fox and MS…
>when I was a teen we watched music videos, but a 70-year old man bought the network and decided that he didn't want us to watch music videos.
That's funny, but empirically that's not what happened. A quant working at MTV realized that reality TV like Real World, Jackass, and The Osbournes were way more lucrative and way more popular. At the same time music exploded in access (Napster). People voted with their eyeballs.
To make sense of the decisions that the TV industry makes you should also consider what their moat is and how they tried to protect it from the internet.
Studios still made content people wanted to watch, monetizing it became a lot harder which is why (strictly) ratings became less important. Bundling came around because it was easier for Disney to force Comcast to swallow channels like Lifetime and Toon Disney if they needed that to get access to ESPN. ESPN (live sports) has no digital compliment and for many people is the only reason they pay for Cable. The name of the game then became "How much money can we extract out of the remaining ESPN subscribers".
Re: Pricing Low-Touch SaaS
#46> Monthly: $49 / $99 / $249
So on the topic of ${X}0 vs ${X - 1}9 (ie. "50 vs 49", "100 vs 99", "250 vs 249"), what's the current "best practice"?
I feel like we might be like those 5 monkeys with a banana: someone figured out long ago in some context that X9 might convert better, now everyone's doing it and the reason might not still be valid.
I'd love to hear about some recent studies or comparative experiences related to this.
For me, subjectively, "49" has the "sleazy car salesman" vibe, compared to "50" being more "we're not ashamed to tell it like it is". On the other hand, I've always felt like this so I was an outlier before.
Re: Pricing Low-Touch SaaS
#47[deleted]
Re: Pricing Low-Touch SaaS
#48Earlier quoted context omitted.
3 column is used for anchoring you to get to the desired pricing (the middle one). https://www.nickkolenda.com/conversion-optimization-psycholo...
Also, if you can change the framing so the decision becomes 'which option should I go for?' instead of 'do I want to buy this at all?' then that's a valuable bit of sleight of hand. But it comes with the risk of decision fatigue
While this might be true from a sales perspective, I'm actually annoyed when there is a product I want to buy and then I see these tiers.
Re: Pricing Low-Touch SaaS
#49> Monthly: $49 / $99 / $249 So on the topic of ${X}0 vs ${X - 1}9 (ie. "50 vs 49", "100 vs 99", "250 vs 249"), what's the current "best practice"? I feel like we might be like those 5 monkeys with a banana: someone figured out long ago in some context that X9 might convert better, now everyone's doing it and the reason might not still be valid. I'd love to hear about some recent studies or comparative experiences rel…
I split tested $49/$149/$299 per month vs $50/$150/$300 and the 9's converted better.
Re: Pricing Low-Touch SaaS
#50Great article. Related to charge more: don't dismiss a higher price point outright as "probably being high-touch only"; it's worth testing. We have a $999/month plan for example which we still sell on a low-touch model.