Top Mistakes to Avoid When Running a Pricing Strategy Project for Your SaaS

May 7, 2025

Introduction

Pricing is perhaps the most powerful, yet underutilized, strategic lever in SaaS. According to a study by McKinsey, a 1% improvement in pricing can translate to an 11% increase in operating profits—far outpacing the impact of improvements in variable costs, fixed costs, or sales volume. Despite this outsized impact, many SaaS executives approach pricing projects with insufficient planning, unrealistic expectations, or flawed methodologies.

Whether you're implementing your first formal pricing strategy or revamping an existing one, avoiding common pitfalls can mean the difference between significant revenue growth and a failed initiative that damages both customer relationships and internal credibility. This article outlines the most critical mistakes SaaS executives make when running pricing strategy projects and provides practical guidance on how to avoid them.

Mistake #1: Starting Without Clear Objectives

Many pricing projects begin with vague aspirations like "maximize revenue" or "increase market share." These broad goals lack the specificity needed to guide effective decision-making.

What to do instead:

Before launching a pricing project, establish specific, measurable objectives aligned with your company's overall strategy. Are you trying to:

Increase revenue from existing customers?
Improve customer acquisition in specific segments?
Reduce churn by better aligning price with perceived value?
Prepare for an upmarket move?

According to OpenView Partners' 2022 SaaS Pricing Survey, companies with clearly defined pricing objectives are 2.3x more likely to achieve successful pricing transformations than those without.

Mistake #2: Relying Solely on Competitor Benchmarking

While understanding the competitive landscape is important, allowing competitors to dictate your pricing strategy is a critical error that ignores your unique value proposition and customer base.

What to do instead:

Use value-based pricing as your primary framework. Research from Salesforce shows that 81% of high-performing SaaS companies prioritize value-based pricing over competitor-based or cost-plus approaches. This requires:

Understanding what outcomes your customers achieve with your solution
Quantifying the economic impact of those outcomes
Segmenting customers based on their willingness to pay for specific value metrics
Using competitive data as just one input among many

Mistake #3: Failing to Involve Cross-Functional Stakeholders

Pricing projects often remain siloed within product management or finance departments, leading to resistance during implementation and overlooking critical perspectives.

What to do instead:

Assemble a cross-functional pricing committee that includes:

Sales leadership (to address frontline concerns and forecast pipeline impact)
Customer success (to anticipate retention implications)
Product management (to align feature value with pricing)
Marketing (to craft the value narrative)
Finance (to model revenue impacts)
Legal (to address contracting implications)

According to Price Intelligently, cross-functional pricing teams achieve 36% higher price optimization outcomes than siloed approaches.

Mistake #4: Neglecting Customer Research

Too many pricing projects are based on internal assumptions about customer value perceptions rather than actual market data.

What to do instead:

Implement a multi-method research approach that includes:

Quantitative willingness-to-pay surveys
Feature value assessments
Win/loss analysis with specific pricing questions
In-depth customer interviews across different segments
Usage data analysis to identify value patterns

A study by Simon-Kucher & Partners found that companies conducting systematic pricing research achieve 25% higher profits than those relying primarily on gut feel or historical approaches.

Mistake #5: Designing Overly Complex Pricing Models

In pursuit of maximizing revenue capture across segments, many SaaS companies create pricing structures that are difficult for customers to understand and for sales teams to explain.

What to do instead:

Embrace structured simplicity by:

Limiting the number of pricing tiers (3-4 is typically optimal)
Using consistent value metrics across tiers
Ensuring clear value differentiation between tiers
Creating transparent add-on structures for specialized functionality
Testing pricing page clarity with actual prospects

Research from ConversionXL shows that simplified pricing structures can increase conversion rates by up to 26% compared to complex models.

Mistake #6: Insufficient Sales Enablement

Even well-designed pricing strategies fail when sales teams lack the confidence, tools, and narrative to articulate value and defend pricing positions.

What to do instead:

Invest heavily in sales enablement before launch:

Create detailed value justification tools and ROI calculators
Develop objection handling guides specific to pricing concerns
Role-play negotiation scenarios with actual pricing pushbacks
Establish clear discount governance frameworks
Provide competitive battlecards addressing specific pricing comparisons

According to Gartner, B2B organizations that provide comprehensive sales enablement for pricing initiatives are 49% more likely to achieve their pricing targets in the first year.

Mistake #7: All-or-Nothing Implementation Approach

Implementing significant pricing changes across your entire customer base simultaneously introduces excessive risk and limits your ability to learn and adjust.

What to do instead:

Adopt a graduated implementation strategy:

Test with new customers before applying to renewals
Consider geographic or segment-based rollouts
Create controlled experiments with defined success metrics
Establish clear feedback loops for gathering frontline insights
Build a governance process for making evidence-based adjustments

ProfitWell data suggests that companies using phased pricing implementations achieve 18-23% higher long-term revenue realization than those using "big bang" approaches.

Mistake #8: Underestimating Grandfathering and Migration Complexity

SaaS executives often fail to develop comprehensive strategies for transitioning existing customers to new pricing structures.

What to do instead:

Create detailed migration pathways:

Define which customers will be grandfathered and for how long
Design incentive programs for voluntary migrations
Develop clear communication templates for different customer segments
Establish success metrics for migration programs
Train customer success teams on value conversations

According to Gainsight, companies with structured migration programs experience 40% less churn during pricing transitions than those without.

Conclusion

Pricing strategy projects represent one of the highest-leverage activities available to SaaS executives, but they also carry significant execution risk. By avoiding these common mistakes and implementing the recommended alternatives, you can dramatically increase your chances of success.

Remember that pricing is not a one-time project but an ongoing capability that requires continual refinement. The most successful SaaS companies view pricing as a core competency with dedicated resources, regular review cycles, and a culture of experimentation.

By approaching your pricing strategy with appropriate rigor, cross-functional alignment, and customer-centricity, you can unlock substantial profitable growth while strengthening your market position and customer relationships.