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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 today's competitive manufacturing technology landscape, setting the right price for your SaaS solution isn't just a financial decision—it's a strategic imperative. The industrial software market continues to expand rapidly, with manufacturing SaaS platforms transforming everything from supply chain visibility to production management. However, even the most innovative manufacturing technologies can falter without an effective pricing strategy.
For SaaS vendors serving the manufacturing sector, optimal pricing remains one of the most underutilized levers for growth. This article explores proven methods to test and refine your manufacturing SaaS pricing to maximize both adoption and revenue.
Why Manufacturing SaaS Pricing Deserves Special Attention
Manufacturing environments present unique considerations that impact subscription pricing models:
- Long sales cycles with multiple stakeholders
- High expectations for ROI and measurable production improvements
- Integration requirements with existing industrial systems
- Varying needs across manufacturing subsectors (discrete vs. process manufacturing)
- Complex implementation realities affecting time-to-value
According to research by OpenView Partners, SaaS companies that regularly test and optimize their pricing see 30% higher growth rates than those that don't. For manufacturing software providers, this optimization can be particularly impactful.
Six Effective Pricing Testing Methods for Manufacturing SaaS
1. Cohort Analysis Testing
This method involves offering different pricing structures to similar customer segments and tracking key metrics like conversion rates, customer lifetime value, and churn.
How to implement it:
- Define cohorts based on manufacturing subsector, company size, or production volume
- Test variables like monthly vs. annual subscription pricing, tiered pricing, or usage-based models
- Measure and compare performance metrics over 3-6 month periods
A leading production management platform tested three different pricing tiers across similar discrete manufacturing customers and discovered their "Professional" tier was significantly underpriced, leaving substantial revenue on the table.
2. A/B Testing on Pricing Pages
For manufacturing SaaS with self-service components, A/B testing different pricing page presentations can yield valuable insights.
Elements to test:
- Price anchoring (the order in which plans are presented)
- Feature bundling and tier structures
- Price framing (monthly displayed vs. annual displayed)
- ROI calculators vs. static pricing
According to ProfitWell, effective pricing page optimization can increase conversion rates by up to 20% for industrial software platforms.
3. Feature Value Testing
Manufacturing operations vary widely in their priorities and value drivers. Testing which features command premium pricing is essential.
Implementation approach:
- Survey existing customers on feature value perception
- Analyze actual feature usage against perceived value
- Test unbundling high-value features into premium tiers
- Explore industry-specific add-ons for supply chain or production modules
One manufacturing ERP provider discovered that their advanced analytics dashboard—previously included in all plans—was valued highly enough to become a premium add-on, increasing average contract value by 15%.
4. Sales-Led Experimentation
For manufacturing SaaS with longer enterprise sales cycles, controlled price testing through sales teams can provide valuable data.
Execution strategy:
- Equip different sales team members with slightly varied pricing structures
- Test different discount thresholds and approval processes
- Experiment with value-based pricing conversations versus cost-plus approaches
- Document objections and closing rates across pricing variants
A major industrial IoT platform discovered through sales experimentation that pricing based on the number of connected assets rather than users resonated better with manufacturing buyers and simplified their purchasing decision.
5. Customer Development Interviews
Direct conversations with manufacturing decision-makers about pricing can reveal insights no quantitative analysis will uncover.
Key questions to explore:
- How do they measure ROI for production management software?
- What pricing models do they prefer for other manufacturing technologies?
- Who influences purchasing decisions for manufacturing software?
- What are their budget cycles and constraints?
According to research by Simon-Kucher & Partners, B2B SaaS companies that conduct robust customer research before pricing changes see 25% better outcomes than those relying solely on internal analysis.
6. Competitive Pricing Analysis
While not strictly a "testing" method, continuously analyzing how competitors price their manufacturing software provides crucial context.
Effective approaches:
- Create detailed competitive matrices of features vs. pricing
- Analyze pricing page changes over time using web archives
- Monitor subscription pricing trends within industrial software categories
- Note which pricing models gain traction in adjacent manufacturing technology categories
Implementing a Pricing Testing Framework for Manufacturing SaaS
To systematically improve your pricing strategy, follow these steps:
Establish baseline metrics - Document current conversion rates, average contract values, sales cycle length, and churn rates before testing.
Prioritize testing methods - Not all approaches will be relevant for your specific manufacturing software. Select methods based on your sales model, customer size, and available resources.
Develop clear hypotheses - For example: "Offering usage-based pricing for our production scheduling module will increase adoption among small manufacturers."
Set testing parameters - Determine sample sizes, test duration, and success metrics before beginning.
Create a controlled environment - Ensure test groups are comparable and other variables remain consistent.
Analyze results thoroughly - Look beyond surface metrics to understand the full impact of pricing changes on customer behavior.
Common Pitfalls in Manufacturing SaaS Pricing Tests
Avoid these frequent mistakes when testing your pricing approach:
Testing too many variables simultaneously - This makes it impossible to determine which change drove results.
Insufficient sample sizes - Manufacturing SaaS often has smaller customer bases, making statistically significant testing challenging.
Ignoring implementation costs - Price testing should account for how changes affect onboarding, training, and support requirements.
Neglecting customer communication - Poorly communicated price changes can damage relationships with manufacturing clients who value stability.
Misaligning with value metrics - Failing to connect pricing structures to the actual value drivers in manufacturing environments.
The Future of Manufacturing SaaS Pricing
The industrial software landscape continues to evolve, with several emerging pricing trends worth considering in your testing strategy:
- Outcome-based pricing tied to measurable production improvements
- Hybrid models combining subscription pricing with usage components
- Ecosystem pricing that accounts for integration with other manufacturing systems
- Vertical-specific tiering acknowledging the different needs across manufacturing subsectors
Conclusion: A Continuous Optimization Approach
Effective pricing optimization for manufacturing SaaS isn't a one-time exercise but an ongoing process of testing, learning, and refining. By implementing structured testing methods, you can discover the pricing approach that best communicates your value proposition while maximizing both customer adoption and revenue growth.
The most successful industrial software providers recognize that pricing strategy deserves the same rigorous attention as product development. By applying these testing methodologies to your manufacturing SaaS pricing, you position your solution to capture its full market value while delivering clear ROI to your manufacturing customers.
As the manufacturing technology landscape continues to evolve, those who continuously test and optimize their pricing strategies will maintain a crucial competitive advantage in this rapidly expanding market.