How do you handle feature updates and new features — do you push them into higher tiers only or give them to all existing customers regardless of plan?

Based on our saas pricing book, Price to Scale, there isn’t a one-size-fits-all answer. Instead, the book recommends a thoughtful, segmented approach. Here are some key takeaways:

• When rolling out new features or feature updates, one primary goal is often to capture greater value—usually by pushing customers toward higher-tier packages. This approach can help boost the Average Selling Price (ASP) and maintain an upward revenue trajectory. However, it can also create friction for existing customers who paid a lower price for a broader functionality set.

• It’s important to recognize that if you simply lock new features behind a higher tier, you may risk alienating or frustrating your current customers, particularly when they face renewal decisions later on. The book discusses this tension—especially when the list price of a premium plan may be two to three times higher than what legacy customers are paying.

• A recommended approach is to segment your customer base. For example, if some customers use only lightweight features, they might be best served by keeping those features accessible in their current plan or through an add-on option. Conversely, customers who need the latest, most advanced features might be nudged toward a premium tier that reflects that enhanced value.

• The book also suggests creative solutions, such as offering upsell menus or special incentives (like discounts or deferred payments) for moving to the new premium plans. If the pricing change requires a company-wide migration, it should be treated as a dedicated project rather than a simple update.

In summary, our pricing strategy book, Price to Scale, advises balancing the drive to increase product value with fairness to existing customers. Instead of a blanket decision to push new features exclusively into higher tiers, consider a segmented, flexible approach that offers options like targeted upsells and alternative add-ons. This strategy ensures that the rollout of new functionalities is strategically aligned with customer segments while mitigating potential friction during renewals.

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