Monday Marketing Mash-up: All About Pricing

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Pricing’s something many of us struggle with, and is a really important part of marketing strategy. And it’s something I’ve been thinking about as we move closer to a paid plan for Markitty. So here are a few interesting posts that talk about how you should price your product.

Different kinds of greens in a market
Customers like options they can compare, even if they’re similar

Here’s why research or surveys usually don’t help you much:

You can’t ask people who haven’t paid how much they’re willing to pay. Their answers don’t matter because there’s no cost to saying “yes” ”$20” “no” ”$100”. They all cost the same – nothing.

What do you do then?

The only answers that matter are dollars spent. People answer when they pay for something. That’s the only answer that really matters.

So put a price on it and put it up for sale. If people buy that’s a yes. Change the price. If people buy, that’s a yes. If people stop buying, that’s a no. Crude? Maybe. But it’s real.

Read the post.

Especially for software products, feedback from non-paying customers isn’t helpful. 

Customers who don’t pay for software, or who want big discount codes on a $9 per month plan, are the wrong ones to take feedback from. As a rule of thumb, feedback from non-paying users tends to focus on additions to the product. Feedback from paying customers focuses on improvements to the product.

Customers who “will buy it when it…” are like the pot of gold at the end of every rainbow. They look super valuable, but they’re always one feature further away than you had thought.

Read the whole post if your product is software.

This (old) post shares examples of pricing experiments, many of them with counter-intuitive results. This is especially interesting:

You can influence people’s choice by offering different options. Old school sales people also say that offering different price point options will make people choose between your plans, instead of choosing whether to buy your product or not.

HubSpot’s post on pricing mistakes has similar examples (but is worth reading all the same).

Have a great week, and if you’ve got a paid product, tell us about how you figured out your pricing!

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