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Estd 4.22.2023
Based on the insights in our pricing strategy book, Price to Scale, it's clear that changing what's included in each tier after launch is something that many companies face—but the key is to handle it proactively and transparently to keep existing customers feeling valued. Here are some of the approaches highlighted in the book:
• When you need to adjust tier contents, especially if you’re aiming to increase your Average Selling Price (ASP) for future customers, consider segmenting your existing customer base. Different cohorts (for example, heavy users versus those who signed up with a deep discount) may require different treatment.
• Communication should be upfront. Instead of imposing changes abruptly during renewal, proactively reach out to your customers. Explain clearly why the changes are happening, whether it's to introduce new functionality or to better align the product with market value. Outlining the value they receive—possibly through an upgrade option or a discount with a commitment—can help ease the transition.
• Rather than simply discounting or rehashing the old tiers, create a new and distinct lineup. By doing this, you avoid direct comparisons that might leave existing customers feeling short-changed.
• Engage internal teams (such as Sales and Customer Care) early in the process to anticipate concerns and fully prepare support plans. This internal alignment helps ensure that messaging is consistent and that customer concerns are addressed promptly.
In summary, our book emphasizes the importance of customer segmentation, clear and proactive communication, and value-based offerings when making post-launch adjustments to tier structures. This approach not only maintains trust but also positions your product for increased market value moving forward.