Do the names of our plans matter (e.g., calling them Basic/Pro/Enterprise vs. more creative names), and can the naming affect how customers perceive the tiers?

Based on our pricing strategy book, Price to Scale, the names of your plans do matter. Clear, differentiated names help customers quickly understand the value contained in each tier and mitigate potential confusion or misinterpretation.

Key takeaways from our book include:

• Packaging is not just about bundling features—it’s also about the careful choice of plan names. Naming your plans in a way that clearly differentiates them can prevent customers from feeling like they're missing out if they downgrade.

• Using familiar names like Basic/Pro/Enterprise can signal a straightforward, graded value progression. However, if you opt for more creative names, it's crucial they still communicate clear differences between plans. As mentioned in Price to Scale, naming the plans differently has been shown to help in ensuring that customers see their current product as the best fit for their needs, thereby reducing the likelihood of downgrade behaviors.

• This approach ties directly into the broader strategy of positioning and packaging. How plans are named contributes to the perceived differentiation between offerings, which in turn can influence revenue capture and customer commitment.

In summary, thoughtful plan naming can significantly impact how customers perceive and interact with your pricing tiers. It’s essential that whichever naming strategy you choose—whether conventional or creative—it should reinforce the distinct value each plan offers while aligning with your overall packaging and positioning strategy.