When selling a B2B SaaS product to a wide range of company sizes (e.g. SMB, mid-market, enterprise), you generally want smaller companies to pay less and larger companies to pay more. This makes pricing difficult—make it too one-size-fits-all and you can accidentally price out the smaller customers, make it too a la carte, and all customers will find your pricing confusing.
What are some pricing techniques you can use when you have a wide range of business sizes to sell to?
Pricing tiers using caps
If you design pricing plans around the expected size of customer, you can make it clear who should be buying which plan and make a natural upgrade path. One way to do this is to include caps around one of the variable like the number of employees. For example, plan A is for up to 50 employees, plan B up to 500 employees, and so on.
Simple and advanced
Providing versions of the same feature can be used to appeal to different size customers and signal to the bigger companies which plans they should be on. For example, you might provide hosting on the basic plan for SMBs but faster CDN for mid-market companies and the ability to set custom headers for enterprises.
Add-ons
Pricing with tiered plans (which is most common for SaaS) comes with the downside that their may be a few critical features that a customer really needs but is stuck between plans. Using add-ons allows customers to pull forward from higher plans to get what they need. Have 51 employees and the cap is 50? Provide an upsell for each additional employee after the cap. Really need a CDN because you are an e-commerce shop? Purchase the CDN add-on for the basic plan.
See also:
- Design the product around the price
- If you have channel partners, you also need to make sure your channel pricing models don’t accidentally introduce channel conflict
- The book Monetizing Innovation has many ideas for figuring out the best pricing