.png)
Frameworks, core principles and top case studies for SaaS pricing, learnt and refined over 28+ years of SaaS-monetization experience.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Based on our saas pricing book, Price to Scale, there isn’t a one-size-fits-all answer—rather, it’s about aligning your product’s unique strengths with the needs of your market. Here’s how to think about it:
• Direct Answer
In a PLG (Product-Led Growth) strategy, viral features are key to driving user adoption and market penetration, while a sound monetization strategy ensures long-term revenue. The right balance depends on your target segment, product use cases, and long-term business objectives.
• Insights from Price to Scale
- Our book explains that for bottom-up companies (think Slack or Yammer), maximizing market share and virality can be more critical early on. In this scenario, viral features are prioritized to build a user base and market presence.
- However, as noted in Price to Scale, you need a balanced approach where low-cost tiers and free offerings drive adoption (see pages 91–93), and premium features are introduced in higher-priced packages to capture value from users willing to pay.
- This balance isn’t static. It’s important to continuously review how your viral features (which drive acquisition) and your monetization efforts (which drive revenue per account) are performing side by side.
• Practical Application
- Start with a core set of viral features that fuel growth.
- Introduce tiered pricing—where you reserve advanced or premium features for paying customers—to ensure the free version is attractive enough for broad adoption but leaves room for monetization.
- Monitor customer feedback and performance metrics to adjust the mix as needed.
- Ensure alignment across teams (product, marketing, and pricing) so that features intended to drive virality do not inadvertently undermine revenue generation.
• Summary
In Price to Scale, our emphasis is always on harmonizing growth with revenue. The balance between viral features and monetization in a PLG strategy is dynamic—it should reflect your current market conditions, product maturity, and strategic objectives. By continuously assessing the impact of your viral functions versus premium offerings, you can fine-tune your approach to both grow your user base and maximize revenue over time.
This balanced, iterative approach is key to sustainable success in a PLG context.