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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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When you've implemented a new pricing strategy, monitoring these key metrics will help evaluate its effectiveness and identify areas for optimization:
Financial Performance Metrics
- Average Deal Size: Track changes in your average transaction value to determine if your new pricing is driving higher revenue per customer
- Revenue Growth: Measure overall revenue increases attributable to the pricing change
- Upsell Rates: Monitor how effectively customers are moving to higher-tier packages or adding more services
- Discounting Patterns: Analyze if discounting frequency and depth have changed with the new pricing model
Customer Behavior Metrics
- Usage Analysis: Determine if customer product usage aligns with your selected pricing metrics
- Shelfware Analysis: Measure unused features or capacity to identify potential packaging improvements
- Customer Objections: Track sales friction points and objections related to pricing
- Sales Team Adoption: Monitor how consistently your sales team is implementing the new pricing structure
Operational Metrics
- Price Bearing Capacity: Analyze $/metric performance across different segments, teams, geographies, and product lines
- Pricing Power: Evaluate your ability to maintain desired price points in different market contexts
- GTM Motion Fit: Assess how well your pricing structure aligns with your go-to-market strategy
- Package/Tier Performance: Compare conversion rates and customer distribution across your pricing tiers
Segment-Specific Metrics
- Geographic Variations: Track pricing performance across different regions
- Segment Variations: Monitor how different customer segments respond to your pricing
- Team Performance: Evaluate if specific sales teams achieve better results with the new pricing
Our case studies demonstrate the importance of tracking these metrics. For example, one $30-40M ARR eCommerce CX SaaS company saw a 15-30% increase in deal sizes after implementing a pricing strategy that better aligned with their enterprise sales motion. Another $10M ARR IT infrastructure company successfully launched their first consistent pricing model, which eliminated customer objections and created a path to monetize new strategic features.
By systematically tracking these metrics, you'll gain valuable insights to continuously refine your pricing strategy and maximize its effectiveness.