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Frameworks, core principles and top case studies for SaaS pricing, learnt and refined over 28+ years of SaaS-monetization experience.
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In the competitive SaaS landscape, a well-crafted pricing and packaging strategy can be the difference between struggling for market share and establishing a dominant position. For Account-Based Marketing (ABM) software providers, this is particularly critical as the market continues to evolve and mature. According to Forrester, companies with optimized pricing strategies generate 11% higher profits than their counterparts with less sophisticated approaches.
This article outlines a comprehensive approach for SaaS executives to execute a pricing and packaging project specifically for ABM software solutions.
Understanding the Stakes
The ABM software market is projected to reach $1.6 billion by 2027, growing at a CAGR of 12.9% according to MarketsandMarkets. With increasing competition and more discerning buyers, your pricing strategy must not only capture appropriate value but also clearly communicate your solution's unique advantages in the market.
Phase 1: Market Assessment and Value Discovery
Analyze the Competitive Landscape
Begin by mapping the competitive terrain:
Identify direct and adjacent competitors: Document not just obvious ABM platform competitors but also point solutions that address segments of your value proposition.
Create detailed pricing grids: Capture competitor pricing structures, tiers, and packaging approaches. According to OpenView Partners' 2023 SaaS Pricing Survey, 78% of high-performing SaaS companies regularly conduct competitive pricing analyses.
Evaluate positioning: Determine if competitors position as premium, value, or middle-market solutions and identify any pricing model innovations.
Understand Customer Value Perception
Your pricing should reflect the value customers actually perceive, not just what you believe you deliver:
- Conduct customer interviews: Speak with at least 20-25 current customers across different segments to understand:
- Which features drive the most value
- How they measure ROI from your solution
- Price sensitivity factors
- Analyze usage patterns: Review product analytics to identify:
- Features that correlate with retention
- Adoption patterns across different customer segments
- Underutilized capabilities that may not warrant premium positioning
- Win/loss analysis: Review sales outcomes to identify where pricing or packaging created friction in the buying process.
Phase 2: Pricing Strategy Development
Define Your Value Metrics
Select the right value metric - the unit by which you charge customers. For ABM software, consider:
- Account-based metrics: Number of target accounts, account tiers, or account lists
- User-based metrics: Marketing users, sales users, or total platform users
- Usage-based metrics: Campaign volume, engagement metrics, or data consumption
- Outcome-based metrics: Pipeline influenced or revenue attributed
According to Price Intelligently, companies that align their pricing with a clear value metric grow 2x faster than those that don't.
Structure Your Pricing Tiers
Develop a tiered structure that creates natural upgrade paths:
- Entry point: Create a compelling yet limited offering that allows prospects to experience core value
- Growth tier: Position your "recommended" plan with the most balanced price-to-value ratio
- Enterprise tier: Include advanced capabilities, higher limits, and premium support
Research by Simon-Kucher & Partners indicates that the optimal number of pricing tiers for B2B SaaS is typically three to four, allowing for sufficient segmentation without overwhelming buyers.
Feature Differentiation
Strategically allocate features across tiers:
- Core features: Available in all plans (account identification, basic reporting)
- Growth features: Mid-tier differentiators (advanced segmentation, intent data)
- Enterprise capabilities: Premium offerings (custom integrations, advanced analytics)
Phase 3: Packaging Design
Create Clear Value Narratives
Each package should tell a coherent story about the buyer it serves:
- Entry package: For organizations beginning their ABM journey with focused campaigns
- Growth package: For marketing teams running multi-channel ABM programs
- Enterprise package: For sophisticated revenue teams implementing account-based strategies at scale
Address Expansion Opportunities
Design your packaging to facilitate natural expansion:
- Land-and-expand paths: Create clear upgrade triggers based on customer success metrics
- Add-on modules: Consider which capabilities work best as separate add-ons versus included features
- Usage-based components: Identify elements that can scale with customer success
According to Gainsight, SaaS companies that effectively package for expansion see 20-30% higher net revenue retention.
Phase 4: Testing and Validation
Before full-scale implementation, validate your approach:
- Conduct pricing workshops: Bring together cross-functional teams to identify potential issues
- Run financial modeling: Project the impact of pricing changes on revenue, growth, and retention
- Test with prospects: Use techniques like Van Westendorp Price Sensitivity Meter or conjoint analysis
- Soft launch: Consider running A/B tests with new prospects or piloting with a segment
Phase 5: Implementation and Communication
Develop a Migration Strategy
For existing customers:
- Grandfathering policies: Decide how long existing customers remain on current plans
- Incentives: Create offers to encourage migration to new packages
- Communication timeline: Develop a phased approach to introducing changes
Enable Your Teams
Prepare your organization:
- Sales enablement: Train on value articulation, objection handling, and negotiation guardrails
- Marketing collateral: Update all pricing pages, sales materials, and comparison tools
- Customer success: Equip teams to explain changes and highlight added value
Phase 6: Measurement and Optimization
Establish KPIs to evaluate success:
- Conversion metrics: Track changes in conversion rates across the funnel
- Average deal size: Monitor changes in initial contract value
- Net revenue retention: Measure expansion, contraction, and churn impact
- Feature adoption: Track usage of tier-differentiating capabilities
The Path Forward
Pricing and packaging for ABM software isn't a one-time exercise but an ongoing strategic process. The most successful companies revisit pricing strategy at least annually, with more frequent adjustments to packaging as the product evolves.
Remember that effective pricing and packaging doesn't just maximize revenue—it serves as a powerful positioning tool that communicates your value proposition and helps customers select the optimal solution for their needs. As the ABM software market continues to evolve, those who align their pricing with genuine customer value will maintain a sustainable competitive advantage.
By following this structured approach, SaaS executives can develop pricing and packaging strategies that not only capture appropriate value for their ABM solutions but also create scalable growth engines that drive predictable revenue expansion.