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Frameworks, core principles and top case studies for SaaS pricing, learnt and refined over 28+ years of SaaS-monetization experience.
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Based on the information gathered, here is how to effectively implement and communicate per-seat pricing:
Implementation Strategy
Align with Go-to-Market Approach
Per-seat pricing should align with your overall GTM strategy. For instance, if you're targeting enterprise customers with high Average Selling Prices (ASPs), ensure your per-seat model supports this approach by incorporating appropriate volume discounts or enterprise guardrails.
Create Clear Pricing Tiers
Structure your per-seat pricing into logical tiers that correspond to different customer segments. Analyze your existing package performance across metrics like average deal size, upsell rates, and discounting patterns to optimize these tiers.
Consider Hybrid Models
As demonstrated in our case studies, consider whether a pure per-seat model or a hybrid approach works best. For example, combining per-seat pricing with company revenue metrics or adding platform fees can provide pricing stability while still growing with customer usage.
User-Based Metrics Analysis
Conduct thorough usage analysis to ensure the per-seat metric correlates with actual value derived from your product. This helps prevent situations where customers perceive they're paying for unused seats (shelfware).
Communication Strategies
Develop Comprehensive Enablement Tools
Create pricing calculators, sales enablement materials, and comprehensive training to support the new per-seat model. These tools help ensure organizational alignment and confident communication to customers.
Create a Detailed Implementation Roadmap
Develop a structured plan for rollout that includes:
- Internal training protocols
- Customer communication timelines
- System updates for billing and provisioning
- Sales compensation adjustments
Focus on Value Alignment
When communicating per-seat pricing, emphasize how this model aligns payment with value received. Demonstrate the fairness of scaling costs with actual usage and team growth.
Prepare Sales Teams for Common Objections
Equip your sales team with responses to typical objections about per-seat pricing, such as concerns about adding users, seasonal fluctuations, or comparisons with competitors' models.
Validation and Refinement
Conduct In-Person Qualitative Studies
Validate your per-seat pricing structure through direct customer conversations. Our approach involves testing pricing and packaging across a sampling of clients and prospects before full implementation.
Perform Price Point Measurement
Use Van Westendorp surveys to determine optimal price points for your per-seat model across different customer segments.
Analyze Pricing Power
Understand your $/seat performance across sales teams, geographic regions, and customer segments to identify opportunities for optimization and to ensure your per-seat rates are appropriate for different markets.
By following this structured approach to implementing and communicating per-seat pricing, you'll create a model that aligns with customer value perception, supports your sales process, and enables predictable revenue growth.