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Should we offer different pricing for different industries even if the product functionality is identical?

Based on our saas pricing book, Price to Scale, you can consider different pricing across industries even if your product functionality remains identical—but only if each industry perceives and extracts value in a different way.

Key points to consider include:

• Value Perception: Even with the same features, industries may derive different benefits due to their unique business models, scale, and cost structures. Pricing should reflect the value that each segment perceives from using the product.

• Customer Segmentation: Our book highlights strategies such as the Good-Better-Best packaging approach, which is often used to tailor packages to different customer segments. Similarly, if industries show variations in willingness to pay, pricing can be adjusted to better match their distinct value propositions.

• Justification Required: It's important that any pricing differences are supported by research rather than simply a decision to charge more for one industry versus another. Understanding each industry's needs, adoption scenarios, and usage metrics is key to successfully implementing differentiated pricing.

In summary, while identical functionality might suggest a one-size-fits-all approach at first glance, our book emphasizes that pricing should ultimately be tied to the value delivered to the customer. If thorough analysis shows that different industries gain differing levels of value, a differentiated pricing structure can be a strategic approach. Always ensure that the reasoning behind any differentiation is sound and transparent, so that it drives growth without confusing your overall pricing strategy.

Get Started with Pricing Strategy Consulting

Join companies like Zoom, DocuSign, and Twilio using our systematic pricing approach to increase revenue by 12-40% year-over-year.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.