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Estd 4.22.2023
Based on our saas pricing book, Price to Scale, the answer is: there’s a clear advantage to creating tiers that reflect your own customer segments rather than simply mirroring a market leader’s packaging. Here are some key considerations:
• Unique Segmentation Matters:
Our book emphasizes that packaging isn’t just about bundling features—it’s about aligning your offers with the specific needs and use cases of distinct customer segments. By creating packages with a clear gradation of value and functionality, you ensure each segment finds an offer that “auto-selects” for them. This tailored approach can lead to better customer fit rather than forcing an ill-suited structure.
• Good-Better-Best Isn’t a One-Size-Fits-All:
While the common good-better-best model might work well for competitors targeting more homogeneous market segments, Price to Scale encourages a deeper understanding of the unique demands of your users. For instance, simply slotting all enterprise features into the highest tier without appreciating what enterprise customers truly value might backfire.
• Innovative Packaging as a Competitive Advantage:
Relying solely on market expectations can lead to “shelfware” situations or mismatches between offerings and customer requirements. By innovating your pricing architecture and segmenting your tiers based on real user behavior and willingness to pay, you can differentiate your product and potentially capture more value compared to competitors.
In summary, while customers might be familiar with the market leader’s approach, our book advises that a deep dive into your customer segments can reveal opportunities for unique, strategically segmented tiers that better address specific needs. Adopting a customized packaging strategy can, therefore, provide a competitive edge over simplistic mirroring of competitors.