Pricing is hard. Changing your pricing is harder. Besides coming up with better pricing, you’ll need the buy-in of your existing customers—both figuratively and literally. Most importantly, you’ll need to explain the gap between what they’re getting today for the current price and what they would be getting with the new price. Why would they pay differently or more if your product is the same? Many companies fail to address this properly—or worse, avoid it altogether.
Surprisingly, many businesses set their prices simply to stay afloat financially.While understandable, this approach limits long-term success. Pricing out of necessity is reactive and organic. In the early stages, solving a customer problem is paramount, but if you don’t eventually become intentional about pricing, your growth will stagnate—or even reverse.
We’ve all heard the myth: “If you build it, they will come.” It’s widely accepted that customers won’t just appear; you need a strategy to attract them. Yet many founders still cling to the idea that focusing solely on the product will naturally lead to revenue growth.
Here’s the harsh reality: creating more value for your customers doesn’t automatically translate into more revenue. Providing value without getting anything in return is essentially charity—not business. It’s supposed to be a win-win: as long as you create more value, you’re expected to capture more value. Failing to do so leaves money on the table.
The simplest way to capture more value? Be intentional about your pricing. This means evaluating pricing from all angles before making changes. Here are five key considerations:
Entitlements Are Sticky — You might capture just a tiny fraction of the value you create for your customers. This doesn’t mean it’s easier to change pricing. Never underestimate how much your customers feel entitled to the current price point, especially if it’s close to zero.
Not All Product Releases Are Equal — Some releases are simply a batch of fixes and small improvements. These do not offer any monetization potential. Major releases such as launching a completely new solution have large monetization potential. You’re missing out on getting rid of legacy and improving your pricing if you don’t couple it with a major release. Your customers won’t be pleased if they receive an update on pricing solely.
Map Usage and Use-Cases, Package Accordingly — Most don’t have the luxury of having full visibility on how much value they’re creating for their customers. This is why proxies are important. A proxy can be any metric that (roughly) correlates with value creation. To be in a position to be more intentional about your pricing and packaging, map how often and at what magnitude you’re solving problems for your customers. Usage metrics should be your starting point.
Your Product Roadmap Should Also Include Your Future Pricing — The same way you’re planning your product releases, you should also know in advance how your future pricing looks like. This doesn’t mean that every product release should trigger a pricing change. Not all product releases are equal. At the bare minimum you should know what your next big release is going to look like and what pricing and packaging you plan on rolling out as part of this release.
Expanding or Unlocking Budgets? — Most major product releases expand budgets. If it’s evident that you’re creating a lot more value today, the budget holder should be kept proactively in the loop to justify better pricing. So far so good. But some product releases might even unlock completely new budgets. That can be a game changer but also requires a different approach both in terms of sales and your pricing.
In sum, don’t expect that your revenue and average deal size will increase as you improve the product and deliver more value. Even if your customer is fully convinced you’re delivering more value than ever, you need to be intentional about pricing. Otherwise you will inevitably leave money on the table.
Want to learn more about SaaS pricing and packaging? Follow Pricing Matters or schedule a free consult at https://revfixr.com/contact
Dr. Anouar El Haji is Founder and CEO at RevFixr. He is known for introducing a Nobel Prize-winning methodology to the world of market research with Veylinx. Anouar holds a PhD degree in Marketing specializing in pricing and behavioral economics and further has two master's degrees all from the University of Amsterdam. His articles have been published in scientific journals and various media.
