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Tiered pricing structure
Hi Will and everyone,
I haven’t joined recent coaching calls but I’ve been very busy applying all the great learning and we’re definitely moving in the right direction.
I wanted to pick your brains on how to structure pricing for an opportunity that could be very big for us but not certain how I should go about it.
Our average deals have been 3-4 users (~5k USD ARR) so quite small and low touch, the biggest we’ve had is 10 users. We offer a small discount when it’s more than 5 users.
We now have a prospective client that is at another scale. The department that we’ve been engaged with only has 3 users. They want to move forward, but when they took their request/recommendations to upper management, management was very impressed with the results from the trial. They’re now considering making our product a standard across the company. It could be anything from starting with 3 users to potentially hundreds. The pricing is going to be part of their decision on how they will go about rolling it out.
They asked if we had a company wide license which we haven’t offered in the past and not sure if it’s wise to do, we’ve only offered user-based pricing. They want to know the different tiers and discount levels at different tiers.. As we’ve only sold up to 10 so far, I didn’t have anything beyond 10 defined but I need to move fast.
Any advice you can share with me on this?
The pricing is going to be part of their decision on how they will go about rolling it out.
Did they say that or have you assumed it?
They asked if we had a company wide license which we haven’t offered in the past and not sure if it’s wise to do, we’ve only offered user-based pricing.
Keep your pricing simple.
Think less about the max you can squeeze from them and more about what $X revenue/year means for your business.
If they want to work with you, they’ll fall in line with how you frame up the deal.
If you start talking about ROI per user, that’s how they’ll think about the value you’re offering.
If you talk about ROI across big teams, then it will appear more valuable.
Also remember that with hundreds of users you’re now having to communicate value to execs rather than end users. The message you share with Major ICPs is going to be different to the Minor ones –
PS – Got your email. Will respond shortly :).
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